Sales in discretionary categories are soft, the hype surrounding direct-to-consumer brands is dulling, and achieving E-commerce profitability remains elusive. Against this backdrop, SuitShop emerges as a triple threat.
SuitShop is a thriving direct-to-consumer, E-commerce company specializing in discretionary goods that people aren’t used to buying. Co-founder Diana Ganz is a fervent advocate for delivering exceptional customer experiences and personally ensuring results that defy industry standards. In this episode, Diana shares insights into how she and her partner have broken through barriers and cracked codes on some of the toughest challenges facing digital-forward brands today.
Episode highlights:
· How problem-solving can overcome discretionary dips.
· Why organic attraction beats paid advertising.
· How new brands stumble early in the game.
· Why showing the hand to promotions pays off.
Information and resources:
Want to be a guest on Spieckerman Speaks Retail?
Contact team@spieckermanretail.com
Check out more of Carol's retail insights and updates
Follow Carol on LinkedIn
Follow Carol on Twitter
Sales in discretionary categories are soft, the hype surrounding direct-to-consumer brands is dulling, and achieving E-commerce profitability remains elusive. Against this backdrop, SuitShop emerges as a triple threat.
SuitShop is a thriving direct-to-consumer, E-commerce company specializing in discretionary goods that people aren’t used to buying. Co-founder Diana Ganz is a fervent advocate for delivering exceptional customer experiences and personally ensuring results that defy industry standards. In this episode, Diana shares insights into how she and her partner have broken through barriers and cracked codes on some of the toughest challenges facing digital-forward brands today.
Episode highlights:
· How problem-solving can overcome discretionary dips.
· Why organic attraction beats paid advertising.
· How new brands stumble early in the game.
· Why showing the hand to promotions pays off.
Information and resources:
Want to be a guest on Spieckerman Speaks Retail?
Contact team@spieckermanretail.com
Check out more of Carol's retail insights and updates
Follow Carol on LinkedIn
Follow Carol on Twitter
CAROL SPIECKERMAN
Welcome to Spieckerman Speaks Retail with me, Carol Spieckerman. I help companies get credit for the great stuff they already do and land bigger deals in their retail B2B businesses. My podcast is all about bringing retail thought leadership. across categories, borders, business models, and touchpoints through my latest retail trajectories and interviews with experts who help us chart the course to what's next.
A three-pronged predicament is frustrating so many retailers and brands right now. First of all, driving growth and margin-making discretionary categories like apparel has become a real struggle. There are lots of reasons for it, but it's a tough nut to crack. Secondly, direct-to-consumer brands have created a lot of buzz.
But it's turning into a buzz kill for some as the limitations and resource realities start to sink in. And even some of the big guys are finding that making e-commerce profitable is still a pipe dream. But my guest has proven that the situation on all three fronts is far from hopeless. In fact, you'd have to call her a triple threat.
About eight years ago, she and her partner launched a direct-to-consumer, e-commerce-based business in their apartments. And they did it in a discretionary category that people either aren't used to buying at all, or they buy very selectively. The business has been profitable from day one and experienced explosive growth since.
Diana Ganz is the co-founder of Suit Shop, which specializes in selling affordable suits and tuxedos to a diverse customer base. I'm so excited to have Diana on the show to share insights on how she and her partner have broken through barriers and cracked codes on some of the toughest brand and e-commerce challenges out there.
And along the way, they've maintained a passion for customer service and hands-on accountability for results. Every time I speak with Diana, I learn something new, and I know that'll be true for everyone listening in today. Hi, Diana. It's so great to have you on the show. Welcome.
DIANA GANZ
Thank you, Carol. It's great to be here.
CAROL
What in the world possessed you and your business partner to try to defy all of these odds and crash into all these headwinds? Was there some sort of singular vision that somehow just made it all make sense?
DIANA
Yeah, what makes two women start a menswear company? Kind of crazy. It really boils down to us wanting to solve a really old problem: that terrible tuxedo rental experience.
I don't have a fashion design background, but I'm very fortunate to have become best friends with somebody in third grade who went on to become a fashion designer, really a technical designer, Jeanne Foley. She's my BFF and co-founder.
She got married in 2013 and they used a big box rental for her wedding and like most brides, she said to her fiance, I'm planning this whole wedding; you need to get your guys' tuxedos. He did. He went the route that everyone goes and the day after the wedding, she was the one returning everything. Nothing fit really well, even though they had apparently gotten fitted for their tuxedos, and the price tag was alarming.
It was $250 for each person to rent the items that they got to wear once. Unless you want to buy a tux for $1, 000, you rent for $200 to $250. And that really was her aha moment, and it stuck with her. So yeah, it was all to start solving a very simple problem, which was, how can we create an alternative to that? Can we create a collection that men and women can own for the same price as a rental? So our suiting starts at about $200 and individuals get to keep it.
CAROL
You're talking about solving a problem. It seems like in the apparel business, problem-solving isn't what's on everyone's mind. It's, wow, we've got such a cool brand. It's funny that it is novel in some cases in that space to solve problems!
DIANA
I know. I had just graduated from business school, I went to MIT, which is pretty entrepreneurial. And their whole thing is that you have to start with a problem. People don't think about that necessarily in retail, or they think about the cool designs that they want to put out, but there's more longevity for a brand if they can position their use case around something that they're trying to solve.
CAROL
Sounds simple, but not what everybody does! With all the different things that I've heard you talk about and weigh in on. It seems like you're always zigging where other people zag. But you're not doing it just for the sake of being contrarian. You have some very logical reasons behind it. One of the examples that comes to mind is your view on marketing. Not only the fact that you don't do a lot of it but also you have some really concrete ideas around timing and how that ties into business stages. A lot of it challenges what you hear in terms of advice, particularly for startups and direct-to-consumer brands, and it really runs contrary to what companies usually do.
So, can you tell me more about what's working for SuitShop on the marketing front?
DIANA
We have a very old-school approach to marketing. It's honestly not that sexy or glamorous. And it's crazy that we have this philosophy because Suitshop was born at the time when your brand was only as good as how much money you could raise for it.
We had, you know, our competitors raising tens of millions of dollars and we were watching that kind of on the sidelines because, shockingly, no VC investor is going to want to give two women starting menswear company any money, because clearly, we don't know what we're doing, even though men have been designing women's clothes forever.
It was a blessing at the time because we didn't have a ton of funding and we wanted to make sure that what we were doing was actually solving that problem. There was interest in what we were trying to do beyond forcing people to do it with a ton of marketing dollars. We wanted to get really real, organic, authentic traffic and momentum around the brand early on, just to see if it would work.
Because we were in our early 30s. We were scraping our pennies together, so it really mattered to us if this was a good idea or not. We weren't playing with anyone else's money. And we started the old-fashioned way, by building great relationships. We are a discretionary purchase, but we figured out a way to sort of also not be a discretionary purchase.
If a brand can figure this out, it's really special. So not only were we solving a problem, we were targeting an audience, a demographic that we knew would have a little bit more virality to word-of-mouth marketing, and that's weddings. We outfit a ton of weddings and what's not discretionary is when your friend says, "Hey, I'm getting married and I want you to be my wedding and I need you to buy this suit." Then you're kind of obligated to buy from a brand and we knew, Oh my God, that's such a good hook to getting SuitShop in front of customers who wouldn't normally be in the market for a suit. But if we give them this great experience, they will remember that and then maybe when they need to purchase another suit down the road, they will come back to us because, especially with men, they're kind of creatures of habit. If they know their size in our brand, they're going to probably order a different color from us down the road because it's easy, especially if we give them a great experience. And because of that, we just started marketing through building great relationships. Building relationships was like, so old-fashioned! No Google ads, no social media campaigns...we just reached out to people, we went to wedding expos, we started really building good word-of-mouth relationships with individuals. And that began to snowball because again, we had this good idea that was solving a problem and there wasn't anyone else doing it at the time.
So it kind of really started to snowball. And that is such a beautiful thing when you can have this like little flame that's going and you can kind of kindle it and get it to become larger without dumping a bunch of paper, money, and gas on it artificially. And so we didn't probably start spending money in ads until about three years in and being really more strategic about that.
That was also pretty lucrative because again, we were able to test things out. Personally, for Jeanne and I - it was really the two of us for the first year of the business. And then we hired people after the first year, but we got to know what customers were interested in intimately. I just worked at the showroom this morning in Denver.
Jeanne still answers the phone a few times a week. So we try to stay close to our customers so we can keep that going. But when we did turn on paid advertising, we knew what mattered. ROI on our ads was phenomenal. Our aggregate ROI for both paid search and social is like 8x, sometimes 10, which is crazy, and now we're kind of spoiled because we expect that. It's careful titration. We don't just throw more money down those channels because we've also seen as you start to spend more, the quality of the leads degrades. So we are constantly trying to titrate various channels, putting more money in, but maintaining those quality returns.
CAROL
I got so much out of that because It's not just the traditional story of "Hey, we were on a shoestring, we had to work with what we have." That was part of it, but really the idea that when you do throw all that money at marketing early on, it can create an artificial situation where you really don't have a proof of concept.
DIANA
You just start buying your customers early on instead of attracting them organically and understanding is this good or not. And unfortunately, it's a slippery slope. Once you turn on that paid marketing and you rely on that for sales, there is no going back.
CAROL
You can't turn off the spigot!
DIANA
Exactly.
CAROL
Another place where you run counter to the current wisdom is your view on customer service. Particularly in e-commerce, the unspoken mantra seems to be less is more and at best, a lot of companies see it as a necessary evil. You guys take a much more hands-on approach and you really celebrate that direct relationship with your customers. So can you tell me more about your approach to customer service, and has it evolved?
DIANA
I mean, not so much because I was just working in the showroom! So, Jeanne and I are still very involved, but we really see customer service as a differentiator for our brand against our competitors. At our price point of $200, we're trying to give a level of service that you would see in a custom clothing experience but at an affordable price point, and that is really where we see our competition falling short and it is never something that we will compromise on. If you read anything about SuitShop, one thing you'll read is that customer service is so amazing. And we really try to have fun with it across the board. Our team is just so friendly. I mean, it isn't, it's not totally rocket science. Jeanne and I are just two Midwestern girls. And we were just going to treat people the way that we would want to be treated. It's not a novel idea. We're going to answer the phone, we're going to be nice, and we're going to be helpful, and we're going to get back to people in a timely manner. You know, there are some things that we have done over the years to help customers self-serve because that is part of giving customers a great experience. It's not like they have to necessarily reach out to us. You don't want them to only be able to find their answers from us. We want solutions to be readily available to them on the website. If, and when they decide to, then we are going to meet them and we are going to show up for them and help them get what they need.
CAROL
I can attest to that. I bought a suit from you and I had a question. It was over a weekend, but I did get a very prompt response, very personal, very conversational. It was an awesome experience. So, do you think that's sustainable over time? Do share some information about the growth that you've experienced over what has it been, about eight years?
DIANA
Yeah, we're going to be eight in February. We've grown 150 percent year over year.
The past few years, we were growing really nicely. Then COVID hit, we kind of stalled a little bit. Sales didn't decrease, they just kind of flatlined from 2019 into 2020. But from 2020 to this year, we'll have gone from a $3 million brand to an over $30 million brand in three years. And so that kind of growth is challenging for a variety of reasons.
And I think maybe it would have been easy for us to offload customer service to a third-party provider but again, we will never do that. But we have come up with a way of distributing customer service across our showrooms. So we're not only online now, we have five, soon to be six showrooms/stores, and we've vertically integrated customer service across those showrooms. That has turned out to be beneficial in so many ways: efficiency of payroll dollars...showrooms aren't busy all the time. The team has pockets of time during the day to respond to customer emails and tickets, and answer the phone. And when they do, the level of service that they give, because they are living and breathing the product every day and helping customers in store all the time, is next level. The customer can really feel like, Oh my God, this person is knowledgeable - they know what they're talking about when it comes to sizing. So that has really paid off and we started that from the beginning. I've heard of some brands trying to retrofit their operations to be this way, and it is very hard. I feel so fortunate that we made that decision to train store associates. Actually, most employees know how to do customer service. There are some that we obviously don't because it's not the best use of their time. But again, Jeanne and I still do customer service because it's core to what we do and it keeps us in the know.
CAROL
The store-based insights are so helpful to the business overall so what a great model for you to know that and to empower the store associates to be involved with customer service across all of your platforms. I have to believe that helps with retention too, because maybe they feel more connected to the business and more connected to the customer.
DIANA
Oh, totally. Every showroom has about three to four full-time employees, and they're getting to talk every day with people across the entire company. Myself, Jeanne, other stores, or customer service, and it's just fun. We have a channel where we share customer comments or funny things that happen. When you're dealing with grooms, then some wild things can happen!
And we celebrate those moments every day, multiple times a day. I think if you get away from customer service on our team, you start to miss it a little bit. We kind of joke that it's like every call is going to be a surprise. What's going to be on the other end? So that has been a really important overall structural choice that we made that has paid off big time.
CAROL
Yeah, definitely keeps you on your toes! You and I first met in person at the TotalRetail Tech Conference, which was obviously focused on technology. And there were some really big companies there that had beaucoups of resources. They were talking about massive technology projects and upgrades and all of that. But technology obviously has to be important for you as an e-commerce business. It's not optional. So how are you making decisions about technology investments and where to deploy people versus technology and those trade-offs, especially as you experience all of this growth?
DIANA
I think it falls into two buckets for us, our tech spend, our tech investments. First, it's surprise and delight the customer. What can we do that just enhances their experience with SuitShop? And then the other one is what can help us be more efficient? Optimizing our payroll dollars, our time to cover operational goals and responsibilities and help as many customers as possible.
We have spent a good amount of money building a fit finder on our website. It requires no measurements and it uses a ton of customer data that we've been gathering from almost the beginning, and it makes size recommendations that are 85 percent accurate. That's a really unique thing for customers to just take 10 seconds to fill something out. Height, weight, shoe size, pant size. If you know your jacket size, great. It even takes into consideration where they live, and what their body shape is based on some photos, and it makes those size recommendations. It's kind of scary to order a suit online.
A lot of our customers, again, because they're suiting up for a friend's wedding, they're obligated to buy. So we want to make sure that it's just a very painless experience. And so that's something that we've really leaned into tech on, and then kind of on that back end, the returns exchange process and reporting.
We're a really transparent brand. We share investor updates. We share how we're doing against KPIs, revenue, all that sort of thing. So we've built some pretty nice dashboards that show all that reporting in real-time.
CAROL
I have to believe that data collection is a very big part of your proposition. So how are you harvesting and harnessing data to boost those two areas that we just talked about?
DIANA
There's the data collection that we've done to optimize our fit finder, but wedding planning can be a short or a long process. It depends on who you are. Sometimes we get a couple that says, I need to suit my wedding up in 10 days. Others aren't getting married until 2027. So we have to be ready and be a part of their journey through it all.
So we have various funnels, opportunities to capture things like their wedding date, and where they are getting married, and we have created various drips across email and SMS that go along with the person in their wedding planning journey. It's not meant to be super salesy, to be honest, a lot of it is just helpful tips...other wedding brands we love...we will trigger people at the right time. Usually, people are trying to figure out suiting four to six months before the wedding so we'll make sure that we get them situated during that prime time for suiting up their friends. But we really rely on that information heavily and we have several ways that we do capture it.
CAROL
It sounds like, since people register with you, you have the opportunity to collect that data for the entire event.
DIANA
Yep, absolutely. We have a wedding group registration system. It's really easy to get a group started. We can see when they're getting married, send reminders, not only the group creator, but to all the friends.
We like to tell customers you can "set it and forget it". We will take over the ordering process and we'll make sure that everybody's ordering the right sizes and things on time.
CAROL
That takes a lot of pressure off the whole experience. You're providing a lot of ancillary value beyond just suits and tuxedos.
DIANA
Absolutely, yeah. I mean, that's part of our tech spend - these internal solutions that surprise and delight the customer.
CAROL
I would think the big spends are what we just talked about: technology and marketing. But there is a whole other roster of things that get in the way of e-commerce being successful, like fraud, shipping costs, returns...
I would love it if you could take on any or all of those, or any that I haven't mentioned that you think are important, and talk about how SuitShop manages through those and why they have not been obstacles for you.
DIANA
It was funny, I was just talking to my co-founder, Jeanne, today, and she was like, "For me, 2023 is going to be the year of fraud issues."
CAROL
That doesn't sound fun!
DIANA
Yeah, she was like, I don't know if I'll ever get past it. We've figured it out now, but we had a major issue and sort of a disconnect between our exchange and return system and our fulfillment center, and we would have people return empty boxes. The other day we got somebody who returned a potato.
CAROL
What?
DIANA
Yeah. Fraudsters, you cannot get away with this anymore at SuitShop! (laugh) I know it went somewhere on the dark web and everybody was talking about it. But we have caught on and it's airtight now, but it is a big issue. It's really a function of Jeanne and me being really hands-on. "Huh...That return looks weird...Let's look into it more." That's how this issue was found. And it was a matter of a few-thousand-dollar expense to what could have been hundreds of thousands of dollars down the road. We are not a fast fashion brand. And I think that there is a lot to be said for that also. And we're not contributing to fashion waste. We've had the same suit in its original four colors since the beginning. We've added some other colors, but we're not a seasonal brand so that just makes everything easier. Sometimes we don't have to destroy returns when they come back, If the season is over, it goes right back into our inventory.
We have such little inventory loss. If something comes back damaged, but very wearable, we donate it. We work with several organizations that do work placement for at-risk youth or refugees and they need suiting to obtain jobs. That's a big factor with our returns process for sure, and makes it a little bit easier.
CAROL
It sounds like that again was part of the original premise - realizing that returns were perhaps not going to be the big problem for you guys with your model that it is for traditional apparel.
DIANA
Yeah, and Jeanne had worked for big brands where they were designing out seasonal collections and she was building the patterns for the designers two years out and they were just having to take a guess at what was going to be a popular fashion trend two years from now. Sometimes you nailed it and a lot of times you didn't, and that just was really wasteful, and she knew that was not the brand that she wanted to build. And I was like, "Thank God," because I order all of our inventory and I am not that smart to figure out what's going to be popular two years from now! So it was a really good insight on her end, having worked for the big brands that she did, but that is not something that she wanted to get into.
CAROL
Once again, the benefits of the business model. I came from that world too, and no, you never get it right, and especially now, when so much of fashion is driven by social media, it's a moving target.
We talked about the stores, and even though I know you have a story about how you sort of stumbled into brick-and-mortar, it turned out to be one of those happy accidents because you're talking about how it's really made a difference in the overall business and how you service your customers. Do you have inventory in those stores? Are you actually selling out of them or doing fittings only?
DIANA
Yeah, I like to think of our website, our online store as an extension of our website. We started the company out of our apartments in New York City, so there was no fitting anyone in person. Although we did do weird things like go to people's office buildings and do group fittings. We were hustling. So we did do some of that, but really, we wanted people to order online and it wasn't until we moved the company out of New York and moved to Chicago where we set up our warehouse and customers would just start showing up.
We would be in our yoga pants packing orders and look at them like, "What are you doing here? You need to go home and place your order online and then we will ship it from here to you." They loved the experience of getting fitted in person, and not everybody is like that. Still, 90 percent of our business is online, which we love, but the showrooms have really become an extension of our website.
It's part of the surprise and delight for the customer, too, where they can go in with their friends, they can have a beer, they can get fitted, they can have the experience that women have always had around dress shopping. So it makes sense that customers love the showrooms.
CAROL
I would think old habits die hard. Guys are used to going in and renting a tux, so maybe it creates a little bit of a bridge or a hybrid experience.
DIANA
And nobody ever takes it, I mean, unless they need something for that night, which happens, but usually we ship. So they come in, they get fitted and they receive their items five to seven days later.
So, we don't carry a ton of inventory in the showrooms which allows us to have really small footprints, and affordable leases, and make sure that the showrooms are profitable within six to 12 months of opening them.
CAROL
Wow. So do you have plans to open more - more aggressive plans - or are you still going to keep it pretty tight?
DIANA
Yeah. Absolutely. We're opening in Atlanta next month, in November. I think we're going to take a bit of a break because we went from three to six. We doubled our showrooms this year. But we definitely have cities that are banging down our door: D. C., Columbus, Ohio, Dallas, Seattle...so we will end up opening them.
It's sort of a bandwidth thing for us. And where we find a great spot, we'll move on it.
CAROL
Sort of opportunistic.
DIANA
Yes.
CAROL
One of my top retail trajectories, probably one of my biggest ones for this year, is "diversify or die," which addresses the fact that most retailers and a lot of brands are going mostly through diversification. They're diversifying into new categories, new formats, and new business models. By comparison, and especially when you're talking about how you've kept those SKUs really tight and the proposition very close to the core...how are you viewing diversification? Where is it happening and where do you see it happening in the future?
DIANA
You're totally right. We have to evolve as a brand and weddings are our bread and butter business But there's so much suiting that's purchased outside of that category. Inventory is such a massive investment for us, especially growing as quickly as we have and having raised very little money. I mean, we're not raising any more money. We try to self-finance our inventory purchases. So it's really tricky and we want to make sure that we're profitable. One of the things that we're looking at next year is sort of an on-demand endless aisle concept, where we can have specialty offerings that are purchased one at a time and we just make them on demand.
And so they're gonna be a little bit more expensive but it really opens up a huge catalog of options to the customer to allow them to kind of get whatever their heart desires, and still at an affordable price point. Still under what some of our made-to-measure competitors would offer. But these aren't going to be made to measure. They're still going to be made from our base patterns.
CAROL
You're not going bespoke.
DIANA
No, no, no, no, no, no, that is no, we don't even necessarily want to say we will make it to your measurements, but we will make it off of our pattern. And we have so many size options that that's always worked well.
So we're excited about that. And just continuing our inclusivity in our collections. We're launching a unisex fit in January that's kind of a hybrid between our women's and men's.
CAROL
I know that diversity is part of your business strategy but is it a big calling card for what you do?
DIANA
When we started, we had no idea that we were going to get the interest from women, non-binary individuals...It was almost immediately after we launched, and the company at the time was called The Groomsman Suit. We started the company as The Groomsman Suit because that's what we were trying to do, give groomsmen suits! As soon as we launched that, we would have women and other individuals coming up to us saying, "I want an alternative to a wedding dress." "I want an alternative to that bridesmaid's dress that they're asking me to wear." "I want to match the groom on his side," et cetera. So it is important to our ethos of who we are as a brand and then we rebranded, which was super scary. After you've built a brand for four years to just rip the name off and maybe cripple its SEO. Who knows? I mean, it didn't, thankfully, but yeah, it is so important to the brand, but we also are careful to not exploit that. It's kind of crazy that we're the only brand that's doing that right now. There are really not many brands that offer a coordinated collection for men and women, and then a unisex fit is impossible to find. It's important to us to be there for the customer, but it's also something that we try not to use as such a salesy factor.
CAROL
What do you think are some of the other things, other than what we've talked about, that you're doing differently that you think might help direct-to-consumer brands?
DIANA
The key thing for Suitshop is that I have Jeanne and Jeanne has me, and we have talked to each other off a ledge so many times! We've never done sales. We don't do Black Friday sales. We don't do Labor Day, or Memorial Day. We've never played that game. We don't offer discounts like that. Especially as a brand, trying to scrape market share, it's hard because that was also something that was happening way back in the day. You just Do a big sale and you get all your customers and then you hope they're going to want to pay full price. But no, because then you've trained them to only want to shop a sale. So that's been one thing that I think has been critical. And we've only been able to stick to it because we have each other. Sometimes I'm like, "Maybe we should do a sale..." and Jeanne says "no" and then vice versa. So it's been really good that way.
I will say we do have a sale page, but that's only for discontinued items. It's never for any of our full price or suiting or anything like that.
CAROL
So the advice is, never have you and your partner want to throw a sale at the same time.
There go your margins! (laugh)
DIANA
I know exactly. But it's such a slippery slope and we just didn't want to play that game. Again, we knew the price point that we were offering, and the problem we were trying to solve. We knew it was a good deal already. A lot of our competition does buy five, get one free and they're always like "What's your deal?" And we're like, "The deal is that it's, $199. It's on the site.
CAROL
I love the point you made about how your business is kind of semi-discretionary because weddings have a way of creating mandates for people. In retail as a whole right now, there is a problem with discretionary sales, and there are all kinds of places you can point fingers. You can turn to consumer data and say it's out of our control, it's inevitable, insurmountable, and so on. But obviously, here again, you've cracked the code on it. So what do you see as some keys to driving discretionary spending?
Do you have any tricks up your sleeve or any advice that you would give to others who are in that business?
DIANA
I mean, honestly, it all comes down to the experience that you give your customers. And when they go to make a repeat purchase, or they say I need to buy this thing. I bought something similar from this brand before, and it was an amazing experience...They're just naturally going to go back to you. If they had a less-than-ideal experience, then they're going to be more inclined to try something new. And we've gotten really far with that philosophy.
I do think we tend to do better in environments where people have to not spend as much. We don't do great when the world shuts down. We've learned when the world shuts down and nobody's getting married...that's when we don't do well! But we do tend to do well when people are on a bit of a tighter budget. It does maybe push some of the more fringe customers to us. And again, then we just give them a great experience and they realize, "Oh my God, I don't need to spend $500 on my next suit! This was so great. I'm going to just come back here next time." So we really believe in the customer service and customer love that we give, and that it will keep customers coming back.
CAROL
...And you've seen it come around enough times to know that it's working. Going back to the e-commerce conundrum, is there any advice you would give in that realm? Why do you think it is that so many companies, even some of the big guys out there that have massive resources, are struggling with profitability in e-commerce?
DIANA
We've talked about the more up-and-coming brands and the roller coaster that they get on very early on and having a lot of cash to spend in marketing and not really understanding truly what their product market fit is. I think that is the number one reason for those younger brands that are struggling with profitability, that they just have never really been able to figure out sales and growth without a healthy, or maybe even an excessive marketing budget. But for those bigger brands, it's hard to stay lean over time. The layers that get built into the organization remove decision-makers from the individuals who are dealing with the customers.
Jeanne and I never want to be in that position. We always want to hear and be in touch with our customers as much as we can while still juggling all the other things that we're doing, because it helps us guide this ship accordingly to the things that matter and it keeps you grounded. It's very hard to do.
And these bigger brands, with hundreds of millions of dollars, have probably become a little bit disconnected from what their customers really value.
CAROL
Yeah. And maybe just unwieldy too. Because once you build up all those layers, it's really hard to tear them back down.
DIANA
Totally.
And I think too, so many of those were built on brick-and-mortar concepts.
CAROL
I was going to ask that, is it a profound advantage to be digital forward?
DIANA
I think so, but maybe that will change down the road and maybe brick and mortar will be the only thing that matters and then we're going to be at a disservice because maybe we're not doing it as well as the tried and true OGs of brick and mortar. (laugh)
But it is so hard. I don't envy anyone in that position - any retail leader who is working for a big brand with hundreds of stores. It is so hard to reverse engineer the concept of serving your customers equally well in-store as you do online. It's really hard.
CAROL
I think that sums it up really well, very hard to reverse engineer.
This has been such a great conversation. I'm thrilled that we've covered a lot of ground. That's exactly what I wanted to do. I end every interview with one question though, and I'll pose it to you, Diana, to answer any way you like. What's next?
DIANA
Well, what's next? We mentioned the made-to-order and the unisex fit we're, we're going to test next year....
Jean and I are also personally getting to a better place where we can start doing fun things like this, Carol! You know, taking time to network with other retail leaders. Joining that panel with you the other month was really wonderful. And I think we are starting to pull our heads up a little bit and be able to network and build relationships professionally and personally, which we're excited about.
And the brand feels a little less fragile so we can give some time and attention to networking and building those relationships> But the customers will tell us what's next. They always have. I look forward to them helping us guide SuitShop. They helped us rename it. They said, "Why are you called the Groomsman Suit? You sell women's!" and we were like, "You're right!" So we really listened to them and I look forward to having their guidance.
CAROL
I think that's just great. Congratulations on your success in unlocking some of the mysteries of direct-to-consumer profitability. Like I said, it's a tough nut to crack, and you've shared some really great insights that everybody can borrow from and learn from. And I think that a bunch of people just ran out of excuses, too. (laugh), but in the best way possible, in ways that will help their business.
I really look forward to following your progress and where you take things next.
I love your business model. I love the way you guys care about your customers. I experienced it firsthand. And thank you so much for sharing your story.
DIANA
Oh, Carol, thank you. This has been so much fun. I really appreciate you having me on.
CAROL
To learn more about the cool things that Diana and Jeanne are doing over at Suitshop or to check out their suits and tuxes for everyone, visit Suitshop.com and you'll find Diana on LinkedIn.
I'm kicking off a new series on the podcast shortly that I know you'll love. Not just the topic, but the dynamic guests I've lined up to take it on. You won't want to miss it so follow me on LinkedIn for updates and you can ping me anytime at carol@spieckermanretail.com, or hit my site at Spieckermanretail. com to check out more insights, subscribe to my updates, and get the latest on events and other happenings. And if you like what you're hearing, please do like, share, and subscribe on your favorite podcast platform.
See you next time!