LONDON, United Kingdom — Matchesfashion.com is to expand its brick-and-mortar presence with a new space in Mayfair.
The site, at 5 Carlos Place, will open in the autumn of 2017, introducing a new retail concept for the brand. The six storeys and 5,000 square-feet of space will play host to events and offer three floors of private shopping suites for clients, as well as a two-floor retail store.
In an exclusive interview with BoF, the company's executive chairman Tom Chapman explained that the space would marry the physical and digital shopping experience in a versatile format without rails, shelves or a cash desk. "We’re creating a space where nothing is fixed," he said. "So [when] we’re talking about event dressing, all of Carlos Place will be turned into event dressing. We’re talking about vacation, we’ll turn it all into vacation ... It’ll be constantly changing and evolving.
"For me, [retail is] about experience and connection, not about racks and racks of clothes," he continued. "Retail stores shouldn’t be about that anymore. It should be about curation."
The property will be the company's sixth London outpost, an addition to its four retail stores and a private shopping townhouse in Marylebone. 5 Carlos Place — along with the other retail sites and the e-commerce business — will now rely on a new proprietary mobile point-of-sale app that will give the company a 360-degree view of the customer, logging every interaction, be it an e-commerce purchase or the attendance of an event, "enabling the brand to bring personalisation into the physical world."
The outpost will also be a permanent home for Matchesfashion.com's "In Residence" events, with a year-round calendar of trunk shows, installations, live-streamed talks and designer dinners.
"I want it to feel like an inclusive, democratic space," Chapman said. "We’re not some elitist fashion store. It’s a place that students want to come and see because they can get inspired by it. It’s a place that everyone can come and get involved and see what’s happening. So it feels like this incredible space that is very beautiful that brings people together ... This isn’t about the revenue. It’s about the experience and the collateral that we can produce."
This isn’t about the revenue. It’s about the experience and the collateral that we can produce.
For a company that generates 95 percent of its revenue from e-commerce, and 85 percent of that comes from outside the UK, the investment into such a significant brick-and-mortar presence might seem unlikely. But for Chapman, the move makes perfect sense as a next-level opportunity to better connect with customers.
"We’ve always had this belief that it’s not about physical or digital, it’s about commerce and customer touch points," he explained. "How do we connect with our customers? If you look at high-value consumers that are travelling internationally, how do you bring them into a conversation? Whether that's on mobile or desktop or social or physical in a store or pop-up. How do we connect them? The more loyal that consumer is — the more touch points that consumer has — the more loyal they are.”
The news of Matchesfashion.com's new physical space comes just weeks after the launch of Farfetch's "Store of the Future" concept was unveiled, an indication that the most ambitious retailers are seizing the "innovate or die" mantra and running with it.
And the investment into physical retail space — as well as experiences — could prove to be a canny one. While luxury e-commerce is growing fast, the portion of personal luxury goods purchases that happen online — now about 7 percent of total — is expected to plateau at about 20 percent by 2025. This means that, for the foreseeable future, the majority of sales will still take place in physical stores.
In March, Matchesfashion.com released its financial results for the first time, revealing 61 percent year-on-year growth and full-year revenues for 2016 of £204 million. Not only did the company enjoy record growth in all markets — 45 percent in the UK and over 80 percent in the rest of the world — but 2016 also saw total online sales increase by 73 per cent, with the website enjoying 55 million visits.
And further growth is on Chapman's mind, as the retailer continues to host private events in cities including Los Angeles and New York. "I think this is an opportunity for us to do something quite exciting," he said. "As we scale and get bigger, New York is probably as large as London is for us. These are markets that clearly have an opportunity. We need to get our feet under the ground and see how we make it and scale it."
"The reality is that we want to scale them in the right way. These are the pinnacle of our brand, they’re the beacons. It’s about doing it in the right way, not just rushing forwards to try and do as many as we can. It’s about making that relationship more special and making the experience better."