Indochino bets big on showrooms
At last week’s Future Stores Seattle conference, attendees heard quite a lot from digitally-native retailers about making the journey offline through experiential showrooms.
While this approach receives some skepticism as a sales channel, Drew Green, president and CEO of men’s custom garment retailer Indochino, pushed back against this view by crediting the brand’s seven-times growth trajectory to the introduction of showrooms alone.
Customers can book a one-hour appointment online for one of Indochino’s 45 showrooms and work with an expert to help pick out their very own custom suit, down to the color and fabric. With 50 percent of their transactions being repeat customers, Indochino’s commitment to customization seems to be working.
“Retail is our number one customer acquisition channel,” said Mr. Green. “When we introduce the brand [to our customers] through retail, we see a higher LTV and lower acquisition cost. Our costs were $145 to acquire a customer online and with retail it is $70.”
Given Indochino’s made-to-order business model and highly personalized retail experience, showrooms can reach profitability a lot faster than other brands because customers aren’t there to just browse but receive a service that when completed results in a $500 sale. With no inventory in stock and a 10 percent no show rate, Indochino is cash positive the moment someone shows up at its stores.
When asked about the future of Indochino, Mr. Green said, “We wanted to be the best at one thing, and that started with a suit. Now we’re endeavoring to be a custom apparel company. We believe the future is custom, being able to personalize any garment.”
It appears there may be a lot more showrooms in Indochino’s future.