Death of Pureplay Retail

January 15, 2016

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By opening stores, the following brands have increased consumer awareness and subsequent site traffic. These disruptors saw the Internet as a way to establish a proof-of-concept and access cheap capital before making the leap to retail.


Contents

Stores Provide An Elevated Experience

Many of the reasons shoppers prefer brick-and-mortar retail are exclusive to the in-store environment, including the ability to try on merchandise and receive the product immediately.

Reasons That Shoppers Buy In-Store Instead of Online

February 2015, n=19,068 Respondents

Exclusive to In-Store Shopping

Omnichannel

Stores Drive Organic Traffic

Facing limited organic visibility for category keywords on Google, evolved pureplay retailers have seen organic search traffic spike following their first store opening.

Changes to Organic Search Traffic as Evolved Pureplay Retailers Open Stores

Date of Store Opening

Date of Popup Shop Opening

Stores in the Black

In 2014, Warby Parker announced that its stores were collectively profitable. The evolved retailer also reported $3,000 annual store sales per square foot, second only to industry leader Apple.

Annual Store Sales Per Square Foot

November 2014

Omnichannel Retailer

Evolved Pureplay Retailer

The New Path to Growth

Founded in 2002, pureplay retailer ModCloth achieved $100 million in annual revenue after 10 years with $63.7 million in funding. Evolved retailer Birchbox grew more quickly with less capital, achieving $125 million in sales with $11.9 million in total funding only four years after its founding. Following the route of Birchbox, ModCloth recently announced it will open a permanent store in 2016.

Annual Store Sales

Millions of Dollars

Birchbox Sales

Birchbox Store Opens

Birchbox Funding

ModCloth Sales

ModCloth Funding

Financial Return

Stores are more than a marketing expense — they can also self-fund. Stores account for at least 20 percent of sales for Blank Label, AYR, and BaubleBar and many evolved retailers have reported higher average order values in-store, where sales associates can up-sell customers.

Percentage of Total Sales Occurring Offline

2014