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March 26, 2015
Maria Pesin

Why do many of the most successful brands have their own stores and online presence?  Brands such as Michael Kors, Ralph Lauren, and Coach sell in almost every department store out there.  Are they competing with themselves when they open a store in the same mall that might have a Saks and Bloomingdales;  especially since many stores have serious real estate devoted to the brand?  When designers first started opening up their own stores the retail community was concerned.  Would Ralph cannibalize Neiman Marcus’s business?  Would Coach hurt their sales at Macy’s?  It seems that rather the opposite had occurred.  Instead of negatively impacting the business the stores found that their business increased.
Selling direct to customers presents some great opportunities for a brand.  With the internet you don’t even have to go through the expense of a brick and mortar store.  Having a website that customers can by from is relatively easy with companies like Shopify simplifying the process.  So what are the advantages of adding direct to customer to your business model?
1. Having a website gives you the ability to sell through out the U.S. and even globally if you want.  So you can sell to customers in areas where you might not have a store buying your product.
2. Communicating your brand message directly.  Giving your customer the whole experience of your brand helps to build brand equity.  You can do this with your own store and website.  You can present your whole line and give the site or store the appearance that will resonate with your brand.
3. When you sell direct you have to sell at the same retail price as the stores who carry your line.  If you are cheaper than your accounts you hurt their business.  This means you will have a much higher profit margin than you will have selling to stores.  And higher margins mean more profit.
I always recommend to my clients that they do some form of direct sales.  It gives them another revenue producing stream.

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Maria Pesin

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