Fabletics, a start-up three years ago by the famous celebrity Kate Hudson and Associates, is now a thriving retail business offering athletics and leisure apparel for women. The fashion industry, as one can easily guess, is already saturated for any start-up to venture and hope to reach a turnover of over $250 million in just three years, but Fabletics achieved it rather easily, or so it seems. Amazon is currently the market leader in the fashion e-commerce market, holding over 20 percent in online sales, but Fabletics seems like it’s challenging it already.
The business model of Fabletics is primarily focused on the subscription model where the consumers pay a membership fee and become a VIP member, which opens their access to huge discounts and a range of other benefits. The price of clothing for members is affordable, and the discounts are regularly offered to make shopping at Fabletics even more attractive for active shoppers. However, Fabletics has ensured that the membership fee or the pricing of clothing is not over-expensive. It focuses on the urban middle-class segment of the society, who do not mind getting associated with an aspirational brand and prefers active wear clothing through a monthly membership.
The reverse showroom technique followed by Fabletics is also one of the reasons why it has been able to achieve phenomenal success in just three years. Reverse showroom technique means that the company followed the strategy to first penetrate the market and encourage brand recognition by launching and promoting their online e-commerce portal. With the successful launch of the company’s e-commerce portal and aggressively marketing it, both online and offline, the company was in a rather short period of time, supported by the celebrity status of Kate Hudson, able to achieve a more than decent customer base across the nation.
The excitement for the brand was triggered, and more and more people were able to identify the brand and with the brand, which further helped the company to go ahead and start launching their brick and mortar stores across the nation. And, with the people already interested in Fabletics, it only made sense for the existing as well as the people who were interested in the brand to check out and experience what the brand had to offer. This helped Fabletics to be a success, both online and offline, which is a rather compelling case study in today’s competitive fashion retail industry, especially due to the time frame in which the company became a nationwide success.
Fabletics is now a company that has over 400 employees and close to 1,000 customer care representatives. The company was founded by Kate Hudson, Adam Goldenberg, and Don Ressler, who is also the CEO of Fabletics, and has headquarters in El Segundo, California, US. The subscription service of the company for shopping is regarded as one of the key reasons why the company has been able to achieve success so fast. In this service, the members get a monthly update of new designs and can easily pick and choose the items they want at a hugely discounted price. The company has one of the most fashionable ‘athleisure’ products collection, and with its member base growing consistently, Fabletics is surely going to pose a threat to other major fashion e-commerce retailers in the time to come, if not already.