Diane von Furstenberg, our Chairwoman, likes to say, “You have to surf the tsunami” in this changing landscape of retail and consumer experiences.
She’s right. On Thursday morning, the CFDA hosted a NETWORK. conversation at that discussed ‘the drop” retail concept. Held at Hotel 50 Bowery , we had the experts on the topic on hand: Thomas Cykana of Kith, Jackie Kim of Barneys New York, and Shimon and Ariel Ovadia of Ovadia & Sons. They were challenged with questions from Jeff Carvalho from Highsnobiety.
The idea of “dropping” new or exclusive merchandise to create hype around product is being adapted by brands old and new. Barneys, for example, opened a shop-in-shop called “The Drop” as a way to bring excitement and entertainment into the store. Kim explained, “The fact that consumers can get something at the store that they can’t get anywhere else brings an emotional element into the shopping experience and adds another level onto consumer loyalty.”
The concept is different from the original business model that Ovadia & Sons started with. “We had to sit down and think about how to differentiate the exclusive product from the collection product,” Ariel Ovadia explained. “We were lucky enough to work with Barneys to have a specific drop date at the store that also aligned with the date that we dropped the merchandise on our website which allowed us to drive traffic to our site.”
The panelists agreed that the ultimate goal is to create an experience and sense of discovery for consumers. Cykana said, “Experience is the most important part. There are a number of touch points that are key—customer service and giving rewards, such as Kith Treats can make a memorable experience. You don’t want the consumer to forget the time he or she went to Kith. When you walk into a Kith store and you find things that you didn’t know existed, creates that sense of discovery. Social media has made it hard to do that so you have to be willing to work really hard at offering product that consumers can’t get anywhere else.”
Collaborations have also become a popular way to create new and different merchandise but it’s important for the collaboration to be on-brand and beneficial to all parties involved. Shimon Ovadia stated, “It’s all about having a purpose for the product and it has to be true to the brand because the customer can see right through a meaningless collaboration. The consumer is so smart now and they really want quality product. ”
Asked about the benefits of the Tommy Hilfiger and Kith collaboration, Cykana said, “If there’s not an upside and benefit to both parties, then we won’t end up doing it. There always has to be a benefit for everyone otherwise we will lose our core identity.”
Kim added that the “drop” model has brought a new way of doing things for retail but ultimately, it comes down to two things: “The product, and creating the right kind of noise for the right kind of people.”
