Company of We | Building an Online Fashion Business

Company of We, S/S 2010 | Source: Company of We

Company of We, S/S 2010 | Source: Company of We

NEW YORK, United States — Today, building a strong online sales channel is often vital to the success of an emerging fashion business. But because the task can seem daunting, many young designers delay developing their own e-commerce sites, and instead outsource their internet sales to online retailers, losing a significant share of full retail margin that can be earned when selling directly to the end consumer.

While it’s almost always cost-prohibitive for a new brand to open a bricks-and-mortar store in the early days of the development of a new fashion business, New York-based menswear label Company of We has proven that setting up a fully owned and operated e-commerce presence from day one can be done — and done well — in a way that’s cost-effective and relatively simple.

Company of We, the brainchild of Jayzel Samonte and Christopher Crawford, began in June 2009 entirely as an e-commerce site. There was no budget for expensive fashion presentations or advertising campaigns. But when the young brand launched its first line online, it sold out — 2,000 units to be exact — in just eight days.

Starting their company online felt like a completely normal and natural move, says Jayzel: “I think it is where things have evolved to. All of our friends shop online at designer sales sites like Gilt Groupe and rarely go to luxury department stores unless it’s sale season.”

So how did they do it?

The partners began by researching off-the-shelf software packages. “If you devote a weekend to it, you can do it on your own. You can build it from the ground up, [adding] shopping cart software to your existing site. Or you can purchase all-inclusive programs like Volusion [that come with] a concise inventory system, shopping cart, ROI Tracking, customer database and easy to use templates.”

Not wanting to limit themselves to a templated look and feel, Company of We ultimately hired web technicians to help them. But, with the bottom line in mind, the pair instructed their developers to create a simple site focused solely on product. “It’s important not to go crazy on sophisticated flash presentations and complicated designs when you can achieve the same level of success by keeping it clean, concise and focused,” advises Jayzel.

“It’s very low overhead to start as an e-commerce store. You’re looking at $2,000-3,000 dollars a month,” adds Christopher. Compare that with commercial rents for physical space, which can easily add up to ten times this amount.

Easy online data tracking was another plus. “We were methodical with our ROI tracking and tracked our growth on sites like Alexa and Google Analytics,” Jayzel explains.

And then there’s the added advantage of dealing with the consumer directly, which can be especially important during the early days of a fashion brand. When you operate your own e-commerce channel, “you get a lot of feedback, which is a great way to gauge what the market is before you get into a larger wholesale front,” Christopher added.

Today, building on its online presence, Company of We is found in retail stores around the world, including cult favorites like New York’s Oak and LA’s Fred Segal, as well as big name department stores like United Arrow, Holt Renfrew, and Saks Fifth Avenue. Their profit margin is just below 40 percent and their product never goes on sale.

With an accessories line coming soon and a possible expansion into womenswear on the horizon, things are looking bright. But while Company of We now make more money offline than online, they continue to emphasise the importance of e-commerce: “We always want to maintain a strong presence [online]. It was the heart of our company.”

Elizabeth Peng, an M.A. student in Fashion Journalism at Central St Martins, is an editorial intern at The Business of Fashion.

Post a Comment

15 comments

  1. Yes, this is a great example of what’s possible on a small budget. However, some feedback from a former customer: put more oomph into customer service! My experience trying to exchange something from this site was pretty frustrating.

    bcasement from Sacramento, CA, United States
  2. Whilst it is always good to see new and emerging fashion businesses doing well, this article really does gloss over so many key areas to launching an e-commerce business. What about developing a collection, sampling and then manufacturing the stock that will be sold on the site – this can be very problematic and expensive. How are product lines selected and costed?
    The $2000-$3000 cost per month is actually a large some for many start up businesses thus proving having the correct funds and capital is paramount. How about the ‘back-end’ of the e-commerce and how do they store/package/dispatch products to it’s customers?
    No mention of how much time, money, expertise and effort that goes into driving enough traffic (unique visitors) to a site that makes it comercially viable? SEO, marketing and brand development.

    Much as I welcome upbeat success stories in the busines of fashion, I fear this glosses over so many crucial areas that it actually misleads and presents it all as being so easy to set up and run a commercially viable fashion brand online – which any e-tailer will tell you it is not!

  3. I agree with David, I also think that you cannot become this successful without marketing and that part is not mentioned. I hope we can read about that as well soon!

  4. @ David and Dora. Thank you for your comments. Jayzel and Christopher were able to drive traffic to their site and sell out of their entire first collection in eight days primarily because of an article that Meenal Minstry wrote on the now defunct men.style.com. From that one article, news of their line spread virally and they were later approached by a number of sites like fadmashion.com and New York Magazine.

    They also sent catchy product descriptions and images to as many smaller style blogs as possible, for example http://www.paolosavi.com or http://www.notcouture.com, which drove a surprising amount of traffic.

    Additionally, they offered a $25.00 gift card to each person who joined their mailing list, which allowed them to increase traffic to their site by 4000% each time a newsletter was sent out.

    All of this they were able to do on their own and with minimal cost, so that they could save up for a game-changing publicist, Libby Haan, who was able to give Company of We greater direction, and who also understands the importance of new media.

    They’ve subsequently worked with vendors like Gilt.com, who have a vast network of customers. When Company of We is featured on their website, they’re suddenly exposed to a customer base of over 2 million people.

    Probed on this subject Jayzel said: “We don’t discount the necessity of creating strategic marketing strategies, but fortunately for us, it was just that easy. We live in a new age of technology—and so long as you’ve got the vision and drive and proper resources, finding an audience is not so complicated. I think worrying about all of these traditional marketing elements—which were much more relevant before the Internet—can stifle new brands from getting their stuff out there. What’s the old adage? ‘If you build it, they will come.’”

    Elizabeth Peng from Paris, Île-de-France, France
  5. ms. Peng, great response in your comments section. Will take this article to (fashion school) tomorrow.

    B

    bare from Australia
  6. It’s really amazing seeing what this new generation of kids are doing. I think it’s important to champion ingenuity and resourcefulness rather than boggle it down with old world marketing strategies that, as more companies like Company of We are proving, are becoming increasingly irrelevant in this true digital age. Kudos Jayzel and Christopher, there is a reason you are the most read article on this site.

    Cort Leland from Wallington, NJ, United States
  7. It’s great to see that the web is a definitely a viable platform for fashion labels, especially for emerging designers. There are a lot of naysayers out there that criticize online retailing, but the matter of fact is that people spend more time in front of their computers than out in the stores. Good design and quality production, like that of Company of We, is bound to get attention and hype on the web.

    Isaac Sohn from New York, NY, United States
  8. Don’t believe the hype! I recently bought a jacket from their website and was hugely disappointed to the extent that I’m insulted as an online consumer. Company of We’s online product description for the $345 jacket stated it was 90% cashmere and 10% wool. In actuality, the jacket is 100% polyester (even the tag says so). I’ve seen better materials used at JC Penny. Their website says that they refund in credit only and don’t refund shipping. Well, based on misleading and inaccurate web descriptions, I expect a full refund although I haven’t heard back from my email sent earlier today. Be wary.

    Joe L from New York, NY, United States
  9. I ordered a coat for my son as a Christmas gift. The Company of We agreed to refund my money since my son did not like the coat. I returned the coat the beginning of January (plus the duplicate coat they sent in error). I have still not received my refund nor any acknowledgment. The Company of We phone numbers are “out of service.” I consider this a costly lesson in trusting only those vendors I know to be reputable. I advise buyers to beware of this company.

    Elizabeth Kane from Alexandria, VA, United States
  10. i bought a few pieces from the company of we website – horrible experience – these guys are crooks – never again will i buy anything from them again. crooks…

    john from Toronto, ON, Canada
  11. Good article which summarizes some aspects of an online fashion business. But I wonder if a purely online fashion can only target low-end price sensitive consumers as many online consumers tend to be price sensitive. Any comments on that?