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Fabletics, a fashion company combining ground-breaking marketing with a trendy product

11/22/2016 11:32 am ET | Updated Nov 22, 2016
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Marketing methods have drastically changed over the past decade. With the surge of social media and smartphone advertising approaches, it appears that nothing is as it used to be. Businesses are constantly looking for new and inventive ways to market their brands to a public who wants them; one such company is Fabletics. Their method of marketing that appeals to today’s tech-addicted consumer.

What is this “reverse showroom” approach?

Fabletics, like a few other companies, uses a method called the “reverse showroom” approach. People don’t have to trek all the way to the mall to do their shopping, with the popularity of e-commerce the clothes are delivered right to their door. Fabletics uses their retail stores to expose customers to their brands and drive them to their e-commerce site. Some say this method of marketing is risky, at best, but companies like Apple and Warby Parker have used these methods without issue. By focusing on creating brand awareness and an optimal customer experience, people are more willing to shell out their dollars.

What do they mean by “VIP?”

To get people hooked on their clothes, Fabletics offers their first outfit at the introductory price of just $29.95 if you agree to join their VIP program. The fine print is that once you sign up for the program, you are automatically charged every month. However, you can opt out of being charge by signing into your account and skipping your show room before the 5th of the month. Simple enough.

Fabletics has been around for over three years, and they currently have done over $250 million in sales—so the subscription VIP program obviously doesn’t deter too many customers. They are sending out more than 800,000 clothing orders per month on their VIP Program alone. That doesn’t account for the other random orders from people who buy the clothes at full price.

Kate Hudson - marketing gold

The face of the company is none other than Kate Hudson. She is not only the spokesperson, but also one of the founding partners. What she lacks in sales and marketing experience, she makes up for in brand appeal. Hudson has a huge part in drawing a young, fashionable demographic interested in a healthy lifestyle (or at least dressing the part). The styles are fashion-forward with mesh inserts and bold colors, and unlike some other athleisure brands, they cater from size XXS-XXL, in an effort to be all-inclusive.

A tech powerhouse

So why should your average investor pay attention to a fashion line with a rom-com actress co-founder? Beyond the reverse showroom and celebrity spokesperson tactics, Fabletics has used data they have received from their website them to determine what product will be sold in their stores as well as what to create for the next season. In doing so they are able to allocate product to appropriate regions, reducing markdowns, as well as reduce the amount of by-product and waste.

In another move in the right direction for the company, Kate Hudson has been asked to speak at the Recode’s next Code Commerce event scheduled to take place on December 6, 2016. She will be there with big names like Apple, Jack Dorsey and the Wish Company. The event will focus on unscripted onstage interviews with successful tech entrepreneurs. After the "town hall" type meeting, guests will get to mingle and have dinner with speakers and industry insiders.

It is not unusual to have celebrity made brands and products. However, when a celebrity-backed web brand makes nine-figures in three years, they catch the tech world’s attention.

Hudson will be speaking on their innovative marketing model, revenue predictability, and creating a brand around a lifestyle. Adam Goldenberg, the co-founder of the company and co-CEO of JustFab with Don Ressler, will also join Hudson at the event. Goldenberg and Ressler’s umbrella company TechStyle is set to see profits equating to more than $650 million. Goldenberg and Ressler are also the minds behind subscription retail brands JustFab, ShoeDazzle, and FabKids.

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