Naked Retail
What: another physical retail location for DTC brands to showcase products
Why it is important: department stores used to be the place where small new brands and designers went to show their work. Will the new players replace the old guard? Supplant the old business model by their own?
Naked Retail started with two designers who were already running their respective online brands and who needed a physical space to showcase their products. New York City rents being very high, they decided to come together to reduce the rental costs. The Naked Retail concept store was born.
The business model in itself is not revolutionary. Indeed, in the old days department stores used to be the incubators for new brands and designers. Now, instead of showing drawings or samples for attractions, brands showcase their work online before eventually landing a physical space. The means are changing, but not the purpose.
Naked Retail is a brick-and-mortar retailer that showcases online brands' products, allowing for physical interactions with customers. With two locations in New York City (in Soho and in Nolita), it faces competition such as Neighborhood Goods and Showfields. Is this concept different from its fellow competitors, or is it just another variation of the same business model?
What's more to it?
A curated assortment
Assortment is key at Naked Retail, and therefore is carefully curated. The idea is that every brand showcased needs to seamlessly fit in with one another. Each batch of brands comes with aesthetics and a tone that have to do be respected in order to offer a consistent storytelling to customers. Reasons of possible inconsistencies are numerous: price points, manufacturing stories, sustainability engagements… It all relies on the narrative chosen at one moment of the year, and brands depend on that. The idea is to make people feel like they are part of one lifestyle, one space, one brand.
There is an another strategy behind the curated assortment: mixing brands that are already established within their community with lesser-known labels. Having big names draws people in the store, and eventually boosts the more obscure labels who only have a short list of online followers. This is a collaborative space before anything else.
Creative agency
Naked Retail also works as a creative agency for brands that are looking to physically establish themselves, either through a pop-store, or in the long-term at their own location (and not inside one of Naked Retail's locations). Some of their projects include working with Bose and Tupperwares.
Naked Retail response to covid-19: being local
Before the pandemic, sales were split between 70% local customers and 30% out-of-towners. Now local customers represent almost 100% of sales. Upon reopening, the store reviewed its assortment and searched for wellness and home brands, and also for beverage brands. The idea is to be consistent with what the local customers crave at the moment, without relying on tourism.
What does it mean for department stores?
As mentioned above, department stores used to be the place young brands turned to for visibility. Nowadays, they still host various pop-up stores and brands, but this does not seem to have the same impact as it does for the new retailers. But there are some solutions. For example, in order to get around the problem of competition in that field, Macy's invested in retail concepts b8ta and Story, which both work with a similar business model involving hosting dedicated brands for a limited time. Entering partnerships with the newcomers could be a way for department stores to stay in the business.
(Credits: Louise Ancora)