This episode we welcome Drew Green, celebrated Canadien entrepreneur and CEO of the custom menswear retailer Indochino. In our fast-paced conversation we delve into how the rapidly growing apparel brand delivers a remarkable customer experience by creating one-of-a-kind garments through the marriage of digital technology, an innovative supply chain and a network of brick & mortar showrooms. We also learn how Indochino defied the retail apocalypse narrative to quickly grow to 79 showrooms and unpack Drew's "3 Win" philosophy that drove the company's exciting new partnership with Nordstrom.
This episode we welcome Drew Green, celebrated Canadien entrepreneur and CEO of the custom menswear retailer Indochino. In our fast-paced conversation we delve into how the rapidly growing apparel brand delivers a remarkable customer experience by creating one-of-a-kind garments through the marriage of digital technology, an innovative supply chain and a network of brick & mortar showrooms. We also learn how Indochino defied the retail apocalypse narrative to quickly grow to 79 showrooms and unpack Drew's "3 Win" philosophy that drove the company's exciting new partnership with Nordstrom.
We open up the episode with our quick takes on recent retail news that caught out attention. First up we discuss some signs of a "great moderation" including the significant (albeit anticipated) decline in online grocery and a pull-back in UPS's parcel shipments. We also take on Disney's exit from physical stores and Tesla's planned move away from mall-based locations.
NOTE: We'll be releasing episodes every two weeks through September 7, when we'll move back to a weekly format.
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Drew Green
Drew Green is an award winning Chief Executive Officer, entrepreneur and expert in managing fast-paced, high-growth companies. A visionary leader, Green has created one of the world's fastest growing apparel brands. Since 2015, he has established significant strategic capital, hired a world class management team and created global alliances (Dayang Group, Nordstrom and Postmedia) that has led to over +500% growth, significantly increasing profitability KPI's. Over the past six years, INDOCHINO created, launched and has expanded to 80 showrooms, employing over 800 people, with another 2200 people working daily in INDCOHINO’s factories in China, to produce the one of a kind garments each INDOCHINO customer creates.
Previously recognized as top 40 under 40, as well as CEO of the year, Green has been recognized for his accomplishments throughout his career. Green has been awarded the Innovation in Retail award by the University of Alberta, Breakout Retailer of the Year by Chain Store Age, and selected as The Entrepreneur of the Year, by Ernst and Young. In 2019 Canadian Business announced that between 2015-2019, INDOCHINO was #1 fastest growing Canadian retailer, with sales globally, and 3rd fastest growing retailer in Canada, amongst retailers with revenues over $100M. A sought after expert, Green has presented to hundreds of thousands, and been quoted in more than 3,000 news articles, globally including in The New York Times, Wall Street Journal, Globe and Mail, National Post, Washington Post, Toronto Star, Fortune, Forbes, Bloomberg, Huffington Post, TechCrunch, Bloomberg, BNN, CNN and CBC.
Prior to INDOCHINO, Green founded and was Chief Executive Officer of SHOP.CA, Canada's first multi-merchant marketplace, which is now owned by EMERGE COMMERCE, (TSXV: ECOM) which he leads as Founder, Chairman and a major shareholder. Throughout his career, Drew has played key leadership roles at companies that have created billions in shareholder value through leadership roles at DoubleClick (acquired by Google), SHOP.COM (acquired by Market America) and Flontwork (acquired by DoubleClick).
In 2011, upon his return to Canada, Drew founded DREWGREEN.CA INC. as a family office/fund set up to start, invest and work alongside entrepreneurs across Canada, with a mandate to create long term shareholder value. DREWGREEN.CA has founded, chair’d, and/or invested in over 30 companies that drive innovation and growth within and across multiple industries, including Direct to Consumer, ecommerce, omnichannel retail, esports, real estate / rentals , artificial intelligence -- and insurance, educational and property technologies.
Steve Dennis is an advisor, keynote speaker and author on strategic growth and business innovation. You can learn more about Steve on his website. The expanded and revised edition of his bestselling book Remarkable Retail: How To Win & Keep Customers in the Age of Disruption is now available at Amazon or just about anywhere else books are sold. Steve regularly shares his insights in his role as a Forbes senior contributor and on Twitter and LinkedIn. You can also check out his speaker "sizzle" reel here.
Michael LeBlanc is the Founder & President of M.E. LeBlanc & Company Inc and a Senior Advisor to Retail Council of Canada as part of his advisory and consulting practice. He brings 25+ years of brand/retail/marketing & eCommerce leadership experience, and has been on the front lines of retail industry change for his entire career. Michael is the producer and host of a network of leading podcasts including Canada’s top retail industry podcast, The Voice of Retail, plus Global E-Commerce Tech Talks and The Food Professor with Dr. Sylvain Charlebois. You can learn more about Michael here or on LinkedIn.
Michael LeBlanc 00:04
Welcome to the Remarkable Retail podcast, season three, episode three. I'm Michael LeBlanc.
Steve Dennis 00:10
And I'm Steve Dennis.
Michael LeBlanc 00:12
Well, in this episode we've got a great feature guest, Drew Green, CEO of menswear retailer, Indochino. And as you'll hear, I've known Drew for about 20 years, various roles. It was super great to catch up with him and explore their retail strategy today and moving forward. Steve, you, you actually, when we put together a list of folks we wanted to interview way back, Drew and Indochino were already on that list, right?
Steve Dennis 00:37
Yeah, I think Indochino is a really fascinating brand, you know, certainly one of these so-called digitally native, vertical brands, that have come on the scene and gotten into physical retail, really more in a showroom format. But you know, controlling, manufacturing, and doing more custom menswear is a pretty interesting space, much more affordable price points. And as we'll talk about, doing some interesting new partnerships.
Michael LeBlanc 01:04
Well, what, what I thought is always, and always think is interesting about Indochino is, is yes, they do this kind of make-to-build, kind of democratization of men's fashion, but also that they had showrooms, you know, they started as a PurePlay.com, but then when Drew took over, he said, listen, we're never, we're never going to grow the way we need to grow and opened up a, guess what, stores. And now the stores are a bit different, they're more showrooms, where you go in and you get fitted, which is another big advantage, right. Because in the before time, and in this context, I mean, before they had stores, listen, it's tough to measure yourself, right, and they were, they were having a heck of a time, not making the suits, but having the suits fit better, so they solved for that. And then they, they, you know, not only did they open up a few stores, but they opened up dozens and dozens, and in very prestigious malls. So, I thought—
Steve Dennis 01:55
They've got great real estate.
Michael LeBlanc 01:56
Both contexts are really, really interesting. Before we jump in, I want to remind everyone that we have a YouTube channel, so check us out, Remarkable Retail, on YouTube. And not all of our interviews are there, but a lot of our discussion and pre-discussion. And what we're about to jump into now, which is what's caught your eye, caught your interest in the past couple of weeks, in terms of retail news, and then we'll get to our interview with Drew.
Steve Dennis 02:20
A few things, a couple that are part of what I've started to somewhat cheekily, if that's a word, referred to as the big moderation, we made it, hashtag big moderation—
Michael LeBlanc 02:33
I love that.
Steve Dennis 02:35
Is the big decline in grocery. As I'm sure most people will know, grocery really grew disproportionately during the peak of the COVID times, you know, mainly in substitution from eating out. So, but we've actually seen a decline in online grocery pretty significantly. Now, some of that is probably the shift back to eating out, but certainly it seems like mostly customers are getting much more comfortable going to the store.
Steve Dennis 03:09
One of the things that is interesting underneath the numbers, so when you think about online grocery, you really have three kinds, you've got, essentially curbside pickup, you've got shipped to home through the mail, and then you've got local home delivery. So, it was the home delivery and the ship to home, that was down the most. The curbside pickup part continues to grow. That's kind of interesting, yeah, and you know, we'll see how this continues to develop.
Michael LeBlanc 03:36
I mean there's, there's a bunch of interesting threads to pull on, on that. So first of all, it's I guess, probably no surprise to you that the pace of online growth in, in many things would ebb off as stores started to open and our lives started to return to normal. I mean, I know speaking to grocers, they're seeing the basket sizes come down, but the trips go up. Which is kind of a more normal behavior, go more often, buy less stuff, buy what you need, closer to what you need. You know, the footfall has gone up, not down, and that's now families. I mean that's not more, necessarily more trips, that's I'm going now with my wife, or I'm going with the kids and you know, people are feeling more comfortable about that.
Steve Dennis 04:14
Sure.
Michael LeBlanc 04:14
Interesting. On, on, on the Canadian side of the border, Loblaws, which is you know, the biggest grocer in the country, big, big grocer, even in global context, is now doing a big, strategic review of all their initiatives. Galen Weston's coming back as the, as the CEO, not unusual in and of itself, but one of the first things they cut was meal kits. And you and I were talking off mic, hey, if a big grocer can't succeed at meal kits, because you know customer acquisition is a bit easier and all these, who the hell can, right.
Steve Dennis 04:43
Yeah, yeah, no, I'm, I'm, I certainly don't understand all the economics behind it, but I was actually pretty optimistic about meal kits working, working for groceries, and then it doesn't seem to be the case, so.
Michael LeBlanc 04:57
Let's talk, let's talk about UPS. So, you, you flagged that you were looking at the UPS numbers. Tell me about that.
Steve Dennis 05:03
Well, this is another potential clue to the moderation we're seeing in ecommerce, overall. So, UPS reported in their quarterly earnings that their parcel deliveries were down. I think it was about 2.9% year over year, the deliveries to homes were down in the teens, whereas deliveries to businesses were up. Now, you know, it's a little bit hard to tell, because UPS is obviously not the only provider of delivery services, so there may be a little bit of a mix issue. They did cut back on some of their smaller business customers, because of the capacity issues they had were favoring bigger customers. So, it's a little bit hard to say this directly correlates to what's going on with ecommerce overall, but I think when we take this together with some of the data we've seen on, on ecommerce growth, starting to moderate, kind of paints that picture we're a little bit of a regression to the mean, I suppose.
Michael LeBlanc 06:04
I like your point about the mix, because knowing what I know about packaging companies, and you and I live in retail world, but there are other worlds, if you can imagine outside retail world, you know. Well, medical supplies to the home are going up geometrically, business to business transfers. So, I think again, your points about the mix issue is really germane because I think, you know, they, and I read that UPS had kind of dropped thousands of small clients, not a few. And it was less about capacity and more about profitability in the mix. In other words, we'll make more money delivering home based medical supplies than delivering and trying to get it to the doorstep for other retailers. And I think we're seeing that across the board. So, as you say it's, it's a, not a simple linear equation, this drop meaning this, but I think, as you said the great moderation means maybe they're thinking, hey, okay, if this isn't going to keep growing the way we thought, let's not build that other hub, let's just shift the mix, right. Of who, and what we shift.
Steve Dennis 07:05
Yeah, I think if you want to tie the online grocery story with this, I mean, I think there's a lot of recalibration that's going on the part of, of all retailers as they see certain parts of their business come back more strongly, others that perhaps were distorted or maybe very COVID specific starting to drop off. So, some of this, I think is a natural evolution. Yeah, but you know, obviously, were a lot, a lot of factors are still in play.
Michael LeBlanc 07:29
So, it's not a small world after all, Disney skedaddles out of Canada. Now this is not new news, I don't think, to the industry, they announced they were getting out of stores, you and I spoke on it back in season two, and it's a bit of a head scratcher for both of us. So, what are your thoughts? I mean, it's just kind of the final, you know, okay, let's, let's close it all up. I, I predict 18 months from today, they'll announce a big flagship strategy where they, they get back into retail, never say never on any of this stuff. What do you think?
Steve Dennis 08:02
Yeah, I feel this is like, kind of, wiping the slate clean and preparing for a reload. I mean, it's just hard for me to imagine that a company like Disney doesn't have some sort of significant, and not, not a thousand stores, but material, flagship and premium model or some kind of strategy that, that can, that can work. So, I think it's a, it's a do-over, reset button, but yeah, I suspect we'll see some activity on this in the not-too-distant future.
Michael LeBlanc 08:35
Yeah, but, but when you know, when you got in there, look into your kid’s eyes, they were excited, right? It's Disney stuff, the stuff they were watching, like there's opportunity out the ying-yang.
Steve Dennis 08:45
So many, so many media properties, so many characters, you know, it's a constant stream of content and trying to marry that together just seems, seems like an obvious thing to do. So yeah, I suspect they'll be back. And then we've got another story of potential withdrawal of stores, not closing them all down, is Tesla has reported that Tesla is going to be pulling their stores from the malls they're in. Tesla's kind of into that, their whole retail strategy has been interesting to me, because you might remember probably a couple years ago, they actually announced, or may have been just Elon Musk blurting out on Twitter or something, that they were going to close all their retail locations, right. That seemed very bizarre, to me.
Obviously, Tesla's got a very different showroom strategy than your typical auto retailer, but it still seemed like you needed a place to go see the car and maybe talk to a salesperson, at least some people want to do that. So, they quickly reversed course on that and looked like they were holding pretty steady for a while here, but now it looks like they're thinking about getting out of some of these high dollar places and perhaps doing something that is not only lower cost, but maybe a little bit, a little bit different in terms of maybe combining with service or some other things.
Steve Dennis 10:04
So, the story is not that clear exactly about what's next, but not good news for some of these malls, because Tesla's certainly a high-profile tenant. I don't know if they draw a ton of traffic, but they certainly have a certain panache, I could say it that way. Yeah, I suspect some of it with Tesla is that when they first built these stores, I think they were, you know, much more advertising you know, establishing the brand, customers didn't really know, they introduced quite a few models over the last five/six years and so maybe they felt like they needed that mall traffic to kind of validate the brand, as well as really expose the brand. But now they've got so much awareness and interest, in particularly in a time where, course I mean this won't last forever but, cars are in short supply. Maybe they figure okay, we can be in a cheaper place, do some different things, and customers are going to come to us and, but we'll see, we'll see how quickly they go. But not good news for mall owners if this is, if this is largely true.
Michael LeBlanc 11:07
All right, well listen, let's, let's pivot from here and get to our great interview with Drew Green, CEO of Indochino and let's kick that off now. Drew, welcome to Remarkable Retail podcast. How are you doing my friend?
Drew Green 11:22
So good to be here, thanks for, thanks for having me, really appreciate it.
Michael LeBlanc 11:25
Well, it's a real treat and Steve is here with us as well, and Steve on our list, you and I, Drew's been on our list for quite a while actually so we're, I'm so excited that we've been able to land him. Drew, you and I've been on a stage, we've known each other like twenty plus years I think, and we've been on a stage together, and, and you've been on my other podcast. But for all the listeners who may not know of you, and may not know enough about you, and may not know about Indochino, tell us about yourself first, and then your role at Indochino, and let's start there.
Drew Green 11:56
Yeah, absolutely, twenty years that sounds amazing, right? Glad that we met when we were ten. Yeah, so you know, I'll give a little bit of my, my background and kind of roll into, to Indochino and what we've been doing here these last six/seven years, you know building a global apparel brand. You know, my background, I've been an entrepreneur pretty much my entire career. You know, I started my first business in university, sold that at the end of getting my degree and, you know, traveled overseas, played basketball in Australia, and lived in Asia for a couple years. And when I got back I just, you know, I really was fascinated with technology, fascinated with retail, and so our first technology company we built and sold to DoubleClick. With that I moved to New York and was head of retail at DoubleClick for many years, of course DoubleClick sold to Google, and that was a great experience.
Michael LeBlanc 12:54
I think that's where you and I first connected, I was at Hudson's Bay launching ecommerce there, I think that's the early days where you and I connected, I think that's still DoubleClick days.
Drew Green 13:04
That's absolutely right, and I was trying to get you on all of our platforms, and it was, it was a great journey to try to do that, I really enjoyed getting to know you. But you know from there I just, you know, really dove in on the ecommerce side, and so I've built marketplaces in the US and the UK, both were funded by Amazon and Bill Gates. Built Canada's first multi merchant marketplace, which you know, we still own through Emerge Commerce, which I'm chairman and founder of. And you know, we moved back to Canada, as a family, almost ten years ago. It's nine and a half years since we moved back, and I really moved back with two goals. Number one was to raise my kids Canadian, you know. They really enjoyed living in New York and, and all that but I just love our country and I wanted them to be raised Canadian. And the second thing I wanted to do, Michael, was, was really invest in the ecosystem for entrepreneurs here in Canada, and build great companies and, and grow great companies and so you know, we've done that. Been back for 10 years now we've invested and founded, you know, over 30 companies now and you know, that kind of rolls into Indochino.
Drew Green 14:16
I got a, an amazing opportunity with, with my partners in Seattle and in Boston to really take what was a very small, at the time, small company that had really good, but I'll say really good infrastructure, really good, a really good concept and essentially restart it. And so, in 2015, we, we took over and kind of reimagined what Indochino could, could be for a generation of men. And we've kind of become what we said we would do, you know, we, we've reimagined how to, you know, create your own wardrobe, create a one-of-a-kind garment, whether that be a suit, or tux, or outerwear, shirts, or pants, build it yourself and have it delivered to you in under two weeks.
Drew Green 15:00
And, you know, back in 2015, I'm sure you remember Michael and Steve, you know, the retail apocalypse, and this is pre-COVID, was the talk of the town, right. Everybody's like, hey, you have to focus on online, and you have to go online only. And I, I've been doing that for, I don't know, 15 years at that point. And, and I kind of took a different approach, I thought that, you know, when you look at, at the consumer, they still spend 90% of their dollars spent in store at the time, and Canada more than 90%. And so, if you're going to become a global brand, if you're going to build a really great company, you have to have an omni-channel strategy, and it has to be interwoven. And so, we set out on that journey, and you know, over the last six years, we've launched 79 showrooms. We partnered with amazing investors and board members, and partners in Japan, and China.
Drew Green 16:02
We recently announced our partnership with Nordstrom, which, you know, is one of the proudest deals that I've ever done. I just, I love the organization that they are, and it's been really, really fun to work with them even through COVID. And we've really set the business up, you know, for great success. We were a nine-figure revenue company and have been for three or four years now. So, we're pretty big company here in Canada. We employ over 1000 people and have another couple 1000 in China working on our, our garments every day. And, and that's really for us what it's about, whether you want to go in-store, online, you, you're able to build your own garment, have a really fun experience doing it and have it shipped to you. And, and, and, you know, our goal is for it to fit you perfectly. Because that's the core essence of our business.
Michael LeBlanc 16:52
Well, you built quite an impressive team and you've got, as you know, I know Peter well, you've got Peter Housley, one of the best in the business in terms of revenue and marketing. So yeah, it's a top, top tier team to take it to that level so quickly for sure.
Drew Green 17:05
Pete's amazing, you know, he's been my, he's been my right-hand man since the beginning. And, you know, you obviously know him very well. He's been, been incredible at what he's done. And, you know, we really focused on that, our, my playbook is people, product, partners. There's a couple other P, but really, those first three are the most important. And our management team is amazing, we've got Morgan, who's our COO, now, who's been with us for five years, Vanessa, who's our CFO, recently promoted, and Alex as our CTO, and just, yeah, they're just wonderful people. But they're also highly effective, obviously, in terms of building the business.
Steve Dennis 17:48
So, Drew, before, I want to definitely dig into some more details around how your business is evolving, and the Nordstrom partnership in particular, but I'm wondering if we could just drop back a second to what you were saying about the importance of physical retail. You're probably preaching a little bit to the choir here, but you know, it comes up a lot from topics we've had on the podcast and other places where people still are kind of obsessed with the shift to online. And I tell the story in my book, and I've told it on stage a few times, about a conversation I had with a pretty well-known founder of a company that's somewhat competitive with yours. This is going back about 10 or 11 years ago when they had raised a bunch of money from some pretty big name venture capitalists.-And I remember asking him when he was going to open stores, and he said to me, and he, and I tell the story that he kind of looked at me, which might be my selective memory, but I kind of remembered him, like looking at me like oh, you sad old man, you just don't get retail anymore, you know, that kind of look. And he said, we're never opening stores. And I said, well, first of all, never is a really long time. But, but secondly, and I'd worked, not only at, I worked with Lands' End, and I worked on, in apparel at, at Neiman Marcus. And, you know, I generally felt like if you're talking about relatively expensive merchandise, that's very fit sensitive, it's kind of hard to imagine not having a physical component. But, but clearly, aside from the retail apocalypse narrative, there's just been this overall narrative that everything's just inevitably moving online.
Steve Dennis 19:24
So, I guess, not only for your, sorry, this is a big, long-winded, wind up to a question, but I'm just curious, why do you think so many people got that wrong. And now obviously, we're seeing a huge move, whether it's Warby Parker, Allbirds, you know, you name it, into the physical stores. What do you think people got, got wrong about that, and if you could make fun of Marc Andreessen’s prediction, you know, you get extra points.
Drew Green 19:48
You know what, yeah, I mean, I don't think anyone's wrong, right. I think, I mean, one of the core attributes of being an entrepreneur, of being a founder, of being a CEO is conviction, right. You've got to believe in, in the vision that you have, and you know, move forward with it. And so, what I, what I really ascribe to though is, you know, constantly questioning myself, constantly being critical of my own thinking and, and learning and developing. And I think, you know, I'm a guy that ran online only businesses for many, many years, founded them, grew them etc. But the facts are the facts right, and the fact is, is that you know, the majority of, the majority of consumer behavior was still happening in retail in 2010, 2015, and 2020, and 2021. And so, if you're a company that aspires to serve, you know, as many customers as you can, and in a terrific way, I just don't know how you ignore, you know, a retail component to your business model. I just, I'm just really not there, like I think you have to do it.
Drew Green 20:59
Now it doesn't mean you have to open up stores, you know, you can integrate with other retailers, or things like that, but you have to have a retail strategy, I think. And look, you know, the fact number two is you look at Amazon, who I'm a big, big fan of, and have been for many, many years, you know, they're in retail right. They've bought some of the best retailers on the planet, and you know, I was walking, I was in Phoenix last week and I was in fashion square visiting our showroom, and across the hall was Amazon, you know. They had a, they had one of their stores there.
Drew Green 21:34
And so, you know, look, I think there's a ton of data, and a ton of facts to show why retail is, is critical to any, you know, consumer business and, but I also understand founders and investors who have thesis's around, and convictions around, online only. I, just for me it's not, it's not the right approach. And then you mentioned you know, Warby Parker, Allbirds, I mean, we're actually bigger than Allbirds from a revenue perspective, and I think from an EBITDA perspective. And you know, we would not have done that, neither would Allbirds, if we, you know, neither of us adopted a retail strategy. And we've done it differently, but we've still done it, right. And yeah, I just, I'm, I'm, I'm a big advocate of, you know, continuing to evolve strategies as well. Which kind of, you know, leads to the sort of Nordstrom partnership that we announced, and you know, we're on a path to launch 100, 200, 300 showrooms, that doesn't mean we need to launch them all in the same format though. We're going to continue to learn, continue to get better, and the core focus has never changed, right, which is let's create a great experience for our customers. Because if we do, they're going to come back, they're going to tell a friend, we're going to earn their trust, and earn their, earn their dollars, right, and so, that's what I think it's all about.
Drew Green 23:00
I think it's also, just last point, when you, when you focus your company on experience, as we have, you know, a lot of retailers say product, product, product, product, which is great, but for me it was, never really was about the product, it's about the experience. And if I can capture your imagination as a consumer, through an amazing and differentiated experience, now I'm pretty confident that you're going to come back, and like I said, you're going to tell your friends. And so, that's what we focused on and, and others have done it as well. You know, Canada Goose is a tremendous example of, you know, having a great product but really focusing on experience.
Michael LeBlanc 23:38
If you're enjoying this interview, you may want to join us for CommerceNext IRL, on September 28th-29th, at the New York Hilton Midtown. Some of the speakers you'll be seeing including Noam Paransky, Chief Digital Officer at Tapestry, Ekta Chopra, Chief Digital Officer at E.L.F Beauty, Matt Gehring, GM of Ecommerce at Everlane, Alex Waldman, Co-founder and Creative Director of Universal Standard, Jennifer Patrick, Global Branding and Packaging Director at Patagonia, and many more. CommerceNext IRL will cover themes such as the resurgence of brick-and-mortar retail and its impact on ecommerce, and how to prepare for a cookieless future. We can't wait to get the CommerceNext community together in person, and hope you'll join us. Learn more, and register now, at CommerceNext.com.
Steve Dennis 24:23
But, how do you think about the balance between your own stores and wholesale partnerships? We talked about Nike a few times, which is obviously a huge company with, with lots of pieces, so they're perhaps not the best comparison. But as you think about expansion, you think about controlling the brand, or managing the brand experience, you think about profitability. Is there any general guidance you can give to, to people that might be listening, and maybe just touch on a little bit why you think Nordstrom is such a powerful partner for you, because they've certainly partnered with a lot of up-and-coming exciting brands.
Drew Green 24:59
Yeah, absolutely, I think there's a few parts to that. I think, you know, number one, you know, obviously, every retail business is different, right. And so, you know, in our world, what we love about our business is that we're what we call virtual inventory, we don't, we don't have inventory. We make our garments after they're ordered. And so, you know, our quote-unquote, wholesale model wouldn't be the same as a, you know, an off-the-rack competitor, right. So, we've never really had to contemplate the wholesale model, because it's just not really something we could do. Definitely could have, give advice on, on how to approach it for, you know, off-the-rack, or ready-to-wear type brands, or even other categories, but for us, it's just not applicable.
Drew Green 25:44
You know, I look at partnerships, again, to me that it's second to people, in terms of building a business. And you know, we partnered extensively on the supply side of our business so, you know, Dian Group and, and their factories in China. Them investing 30 million US back in 2016, catapulted our business and allowed us to scale. And, you know, we've really, really dug in to see how we can partner on the demand side and Nordstrom, you know, frankly, I look at Nordstrom as kind of like iconic, right. Like they are, they are the definite, definition of innovation to me. Like, for over 100 years, they've constantly evolved their business to meet the, the needs of their customers, and that's their focus.
Drew Green 26:32
And so, when the opportunity came up, and we've been talking about this partnership, you know, frankly, for a long time, three, four years, you know, we saw, we saw mutual benefit. And I think, you know, when you're a CEO, when you're an owner, when you're a founder, when you're an executive at a retailer, you know, you have to look for partnerships that have multiple wins, I call it win three. And with Nordstrom, you know, it's a win for them because we get to bring in, you know, a new, new type of customer for them, you know. Someone that's going to buy a $400, $450, US suit, versus maybe $1000, or $1500 suit. And so, we bring in, you know, a new customer, for them, a millennial customer for us, we, you know, the economics of the partnership really worked out. And we're able to introduce our brand to their customers, so that's a win for us. And then ultimately, there's a win for our customers combined, because we've got more locations for customers to choose online versus retail, right. I mean, the fact of the matter is not everybody wants to order apparel online, they just don't, right, or not do it all the time. And so, the more that you can provide them optionality, wherever it is they live or work, I think, you know, the more success you're going to have. I don't know if that answers your question, but that's, that's some of my thoughts.
Steve Dennis 27:55
No, it does, and I think, you know, Nordstrom has been one of my favorite brands for a long time, which is the Neiman Marcus guys, maybe a little bit hard to admit. But I agree with you, I think they've been incredibly innovative for quite a long time. I think they saw the blurring of the lines between digital and physical many years before probably 99%of retailers. I think they get a little bit of a bad rap because they are, you know, it's a fairly mature business for them, at least with their, their core model, but the, the amount of things they've done on the technology front, and the format front, and these partnerships, I think is pretty amazing. So, I think couldn't have picked a better partner. Not that you need my endorsement on that, but I think it's very exciting.
Drew Green 28:38
Yeah, thanks for that. I appreciate that, Steve. I also think you know, culture matters, and they have just an amazing culture there. You know, from the top all the way through and, and so, that makes it easy to have success together because we kind of see the world in the same way and, and they're just good people, right. And you want to work with good people.
Steve Dennis 28:58
Yeah, absolutely, so one last question about that, just to kind of help people visualize it, because I'm sure many people are generally familiar with the Nordstrom, maybe not quite as familiar yet with Indochino, how's the Indochino at Nordstrom experience going to be different from one of your Indochino showrooms?
Drew Green 29:17
Yeah, that's a good question. I mean, we spent a lot of time thinking that through, that very question through, and to be candid, not a lot, right, we, we want you know, our experiences were award winning and we, I think have one of the highest repeat and loyalty rates, you know, across any category and apparel. And so, what we wanted to bring into Nordstrom was, you know, really what we've had so much success in these past six years with our, with our showroom format. I would say the biggest, the biggest difference is, number one, you know, the, the footprint is smaller. So, you know, in Vancouver, we've got eight showrooms, or excuse me, eight fitting rooms within the showroom, 4000 square feet, and most of our showrooms range from, you know, 2300 to 2500 square feet. You know, the footprint we have within Nordstrom is smaller, it's 400, 600, 800 square feet, depending on the location. I think the, the other difference is just, in terms of, in terms of fabrics selections and things like that, we've really kind of tailored it to what we feel the customer at Nordstrom would want the most, as well as our existing customer. But, you know, we certainly haven't loaded the showroom with as many fabrics, the Nordstrom showroom with as many fabrics as we have, you know, our standard showroom.
Michael LeBlanc 30:44
And there'll be, you'll be peacefully coexisting in some shopping malls, I imagine as well, right. You've got quite a large number, you've got quite a presence in shopping malls, and some of them are where there's Nordstrom, so you can kind of think about how you peacefully coexist. It's not unusual, by the way, for that to be the case. But is, are you thinking that, as in here's a tailored assortment, specifically the Nordstrom customer, or you could go to the showroom in the rest of the mall? Those two things are separate but connected, yeah.
Drew Green 31:12
Yeah, I mean, initially, Michael, we what we've done is really focus on, you know, expansion, so new locations, and new areas, new, new geographies that we don't currently have showrooms. We've got the opportunity, I mean, we're at 21 locations now with Nordstrom, you know, I could see this partnership growing to 60, 80, even 100. You know, the numbers are just incredible, here in the early days, you know, 2 to 3x what we forecasted with them, and so, the demand is there. So, I think we're going to have, you know, some decisions to make, to, to your question on, you know, for example, I'll take fashion square, because I was there last week in Phoenix, you know, we've got a beautiful showroom there. And then Nordstrom's, you know, kind of half a kilometer away, within the same center. We're not in, in, in that Nordstrom, but I think we could be right.
Michael LeBlanc 32:11
It's not unusual, right, I mean, you've got, you know, you got a Canada Goose store in Yorkdale in Toronto, and you've got Canada Goose available at Harry Rosen and, and other retailers there, so they can peacefully coexist. But it's, it feels like it's got to be a thoughtful strategy, that, that you approach that so you don't, you know, just cannibalize one, plus one equals three, as you would say, though, the yeah, the triple. Are you still, let's talk about shopping malls for one second, are you still sanguine about shopping malls and their future? I mean, a lot of your real estate is in, not all, but a lot of your real estate purposely went from high street into shopping districts or shopping malls. Are you still, you know, do you think forward and expansion after this great acceleration, whatever the hell just happened after the last 18 months, has it changed any of your perspectives about how you go to market, and where you might go to market?
Drew Green 33:01
I think we're always, we're always, we're always thinking about it, Michael, like we, you know. I don't know if the answer, two, three, four years out. I think we've had a lot of success, you know, first going high street, you know, then really partnering with landlords across North America. Like I said, we're at 79 showrooms now. And interesting, just fact is we were at 53 to start the pandemic, April 1st, 2020, and we're now at 79. I think we've got some great partners in our landlords that constantly bring up opportunities for us. And we're just going to see, you know, we've got, we've got lots and lots of runway to grow in North America, even though we're the largest in the category, and I think we'll, we'll just have to see. I'm, I'm very curious, you know, these next 12-18 months, in terms of the discussions I can have internationally, because that was going to be one of our priorities prior to COVID, and I'm excited to start having those conversations again.
Michael LeBlanc 34:04
Well, it must be a renaissance to the business. I mean, the COVID-era was not kind to work from home, or work, I should say, from work fashion or wedding fashion, but it does feel like we're in for a big lift, lots of pent-up demand, certainly on the wedding side. Not to get into the weeds in the business, but you know, there's, there's, I've heard lots of couples who have just deferred their weddings. Some went ahead with them, and I think that's a big part of your business, right. And then you know, really you need to think about, and I'm curious how you're thinking about, what, what happens next in fashion as people go back to work. Does it, does it impact your assortment, or you think it could be the roaring 20's and we could be wearing zoot suits, custom made zoot suits. Big shoulders, you know Drew, those big shoulders with the big brim hats. Is that part of the assortment, are you planning on that?
Drew Green 34:55
I've done, I've got lots of those hats in my closet. You know what, I, I'm so excited. I think that I mean, first of all, we've had an incredible June and July, just record numbers. The wedding business, we just were sold out in our showrooms most days, and especially on weekends. And so, there's obviously a lot of pent-up demand on the wedding side. I actually think that pent up demand is, is going to last a couple years on the wedding side.
Michael LeBlanc 35:24
I agree.
Drew Green 35:25
And to your point, you know, look, man, like I've been wearing a t-shirt and jeans at home, I'm ready to dress up. Yeah, and I need to refresh my wardrobe, and I'm going to New York in a few weeks, and I need, you know. So, I think there's a lot of pent-up demand on, sort of, freshening up, you know, the man's wardrobe, I think. I do think, I know it's a little funny to say it, but I do think we're in for a bit of a roaring 20's 2.0, you know. People want to live, and people want to experience their life and, and just get out there and you know, and I think they're going to want to dress up to do it. And so, and we're not just a suit company, I mean, we can sell hundreds of 1000's of units of shirting and panting, and outerwear, but, but definitely people are going to want to dress up. And I think, as I've always thought, you know, clothing is just that much better when it fits. And so, we're pretty well positioned, I think, as we get through the 20's here.
Steve Dennis 36:21
Well, and some of us have been experiencing things not fitting quite as well, during COVID, I'm not, I'm not sure what.
Michael LeBlanc 36:30
Too loose for you?
Steve Dennis 36:32
No, no, you know, some of my clothing seems to have shrunk, I'm really not sure what that's about. But fortunately, I have a couple of Indochino showrooms not too far from where I live in Dallas, so I have a way of solving that, that problem, so, thanks for doing that, Drew.
Drew Green 36:49
Yeah, I think the heat waves that we've had have just, you know, shrunk the clothing in the closet.
Steve Dennis 36:55
Let’s blame climate change.
Michael LeBlanc 36:57
Our guest is, is Drew Green, Drew, you've done such a phenomenal job building up Indochino. It's great to hear your voice, what's, I mean, I usually at this point, I'd say what's next? I think this whole conversation has been about what's next. Congratulations on the deal with, with Nordstrom. Certainly, sounds like it's off to a great start, and wish you continued success on that. And really thanks for joining us on Remarkable Retail podcast, real treat, as I said, to hear your voice look forward to seeing you in person and getting myself into, I think I'm having the same issue that Steve is, it seems like a North American—
Steve Dennis 37:33
It’s all barbecue Michael, got to pull back.
Michael LeBlanc 37:36
Thanks for joining us, thanks so much for, for being here and look forward to catching up in person real soon.
Drew Green 37:41
Yeah, I just really appreciate you guys having me on, and really proud of you for the platform you're providing, you know, retailers to talk about what they're doing. So, you guys should be super proud, and, and again, thank you very much. You take care.
Steve Dennis 37:55
Thank you. Appreciate that.
Michael LeBlanc 37:57
All right. Well, that was a great episode, a great interview with Drew Green. And if you liked what you heard, please, please follow us on Apple, Spotify, Amazon Music, or your favorite podcast platform. So, you can catch up with us on all our interviews and insights. New episodes show up every week, particularly if you're subscribed, and be sure and check out our new YouTube channel Remarkable Retail.
Steve Dennis 38:15
And I'm Steve Dennis, the expanded and completely revised second edition of my best-selling book Remarkable Retail: How to Win & Keep Customers in the Age of Disruption, is available just about everywhere, books are sold including Amazon, Indigo, and bookshop.org.
Michael LeBlanc 38:31
And I'm Michael LeBlanc, producer and host of the Remarkable Retail podcast and a bunch of other stuff, you can learn about me on LinkedIn or meleblanc.co. Steve, have a great week and be safe.
SUMMARY KEYWORDS
nordstrom, showroom, retail, business, big, stores, customers, retailers, people, drew, brand, partner, company, build, online, steve, partnership, thinking, mall, strategy