When you look at the retail industry, you hear a grim outlook. Large brick and mortar retailers like Payless, Sears, The Children’s Place, and multiple others have either closed their doors or filed for bankruptcy over the past few years.
However, the specialty retail industry has been vibrantly growing this past year.
82% of specialty retailers have experienced growth, while 68% of them attribute their growth to in-store sales according to Envoy B2B’s independent research. That research isn’t alone. Grassroots Outdoor Alliance has similar data, and reports 3.6% overall growth since Jan. 1, 2019, and an increase of 2.53% nationally over the last 12 months.
So why are specialty retailers thriving in an industry that has been knocking out large box stores?
We recently sat down with Topo Designs, a brand rooted in the community of mountain culture and outdoor living, to get their insight on the answer to this question.
The answer, Topo said, is two-fold: First, specialty retailers drive trends, and secondly, they make the shopping experience personal for the customers.
Because of this, Topo has prioritized their wholesale market and supporting retailers in order to scale business and leverage the unique power of specialty retail. Now, nearly 60% of their revenue comes from selling within the specialty retail market.
Specialty Retailers are Thriving Because They Drive Trends:
When it comes to the latest items in fashion, accessories, and apparel, specialty retail drives business by identifying and capitalizing on trends. These retailers pride themselves on knowing their customer’s wants and needs, and they know how to sell it to them.
“The specialty retailers that have a brick and mortar store deliver value, solutions, and personalization to their customers that can’t be found anywhere else. This personalized, knowledgeable experience is ultimately where trends are born across the industry.” stated Sean Han, Global Sales Leader of Topo Designs.
When you consider big-box retailers, there is no personalization in the items that they are selling. Items are ordered with a general audience in mind. Specialty retailers are on the opposite end of that spectrum, striving to tailor their inventory and shopping experience to their customers.
“As our business continues to grow, it’s our long-term goal to grow as a brand and not just as a one-hit-wonder,” explained Han. “There’s a lot of brands out there that do a full line of items without considering what would work best for their customers. But at Topo, our items are diverse, making sure that we have a robust brand portfolio that matches what customers want. The wholesale market enables us to showcase that.”
Specialty Retailers are Thriving due to Offering a Personal Shopping Experience:
Specialty retailers offer valuable experiences for their customers. They have the opportunity to educate on brands and products, what makes them special, offer real-world expertise, and in some cases even allowing customers to experience the product first-hand before buying. They are the trusted friend helping the customer plan their next adventure outside.
“Our products really make an impact when people can see it in person and understand what makes Topo unique,” said Han. “Having it on our website is one thing, but building strong partnerships with specialty retailers has become an essential part of selling our product, especially on the apparel side. The experts in the store can really bring our product to life for their customers and deliver on what makes Topo special.”
Han further explained that their apparel line has been one of the fastest-growing categories for Topo within the last five-to-six years due to this partnership between the brand and retailers. Customers are able to see the product, and hear the brand story from a trusted expert. This personal shopping experience that specialty retailer deliver has been one of the keys to unlocking growth for Topo.
The partnership and how to grow the Wholesale channel.
Currently, Topo uses a hybrid sales model of both internal and external reps on a global level. As Topo has spent time cultivating their sales team, new systems are needed in order for their sales reps build those relationships. To aid with this, Topo chose Envoy B2B’s ecommerce platform.
With this, Topo is gearing up for even more opportunities to grow. Combined with their current practices and with the help of Envoy B2B, they will enable their sales reps to create and send tailored and pre-merchandised product assortments to their accounts, fully equipped with product education. Within those assortments, retailers can shop, merchandise, and easily order products on their own time. These new tools and capabilities will allow Topo to further leverage their specialty retailer’s ability to drive trends and create a personal experience for shoppers.