An email from the CEO of a premier US performance apparel brand, Ibex, should rock any retail brand. The company is closing. Outdoor adventurers know the technical benefits of breathable Ibex merino wool. It doesn’t become smelly like synthetics, their pieces wash and dry beautifully, and they hold their colors and shape indefinitely. It costs twice as much as synthetics but it lasts ten times longer. So why is the company going belly up?
Online Consumer Does Not Feel Quality
To the average online consumer, they don’t care. Online consumers are conditioned to go for the cheapest deal and often that means buying cheaper imitation products from overseas knockoffs or an Amazon private label.
Ibex is being rocked by changes in consumer buying habits and bankruptcies among large sporting goods store chains who lost their way and forgot to focus on consumer experiences inside their stores such as Eastern Mountain Sports, Sports Chalet and Sports Authority.
Ibex Forgot their Roots
The company forgot its roots of independent retail, which is doing relatively healthy compared to the large chains as these accounts offer something that cannot be had online. Community, Culture, and people on the floor who know their shit. As more big box close (thankfully) physical retail and independents will truly be valued by consumers as destinations to seek out the latest in high quality products.
As a last ditch attempt the company decided on a direct to consumer only strategy and was unable to turn their fortune around. It was the last straw for the company as its independent retail base distanced themselves from the brand as they moved more direct losing their ‘chief influencers’.
Physical Retail Critical to Brand Survival
Retail brands need to invest in what made them great and can differentiate themselves from no-name brands to form better relationships with consumers. The best way to do so is physical retail. Brands and their retail partners need to find ways to collaborate to make better consumer experiences to drive shoppers back to the store. As more brands are soon to find out in 2018, they need retailers and their survival is critical to product discovery and lower consumer acquisition costs at these stores.
As retail brands and Amazon compete with physical retail we will eventually lose quality retailers and brands, like Ibex for that matter. As a brand gets separated from the pack selling direct only, Amazon will pick brands off category by category. The next to fall are niche quality brands, pure and simple. Ibex’s closure is barely registering in the news today–as a niche technical product, it’s too small to really cause a ripple. But it is foretelling a future in which more retail brands will go bankrupt without a focus on making retail great again to drive more consumers to store.
