1-to-1 | UNTUCKit & NewStore
For the Lead’s first Q&A series, Aaron Sanandres, CEO of UNTUCKit, & Stephan Schambach, CEO of NewStore interview one another about the state of omnichannel retail, what success looks like today and what type of a playbook they can offer The Lead’s community for the future.
BY: The Lead Editorial Team in collaboration with Newstore
Here at The Lead we have been watching the UNTUCKit story closely. At The Lead Assembly in June 2018, UNTUCKit CEO Aaron Sanandres spoke to us about the opportunities and challenges of being a venture-backed digital native brand. At The Lead Summit in October, Brent Paulsen, UNTUCKit’s Managing Director and Head of Retail, laid out the company’s rapid brick & mortar growth strategy. And of course, UNTUCKit was selected for The Lead’s 2018 Foremost 50 List – recognizing the break out digital native brands reinventing and redefining the future of fashion & retail.
UNTUCKit is a unique story in our world, a company built methodically, using some traditional channels and waiting until the time was right before choosing to raise venture capital. That time came in the summer of 2017, when Kleiner Perkins – the legendary venture capital firm that backed companies like Amazon, Google, Netscape, Electronic Arts, Intuit and Spotify – invested $30 million in UNTUCKit.
As we looked deeper, we came to see that what separates UNTUCKit from many in the industry is not its trademarked untucked shirts, but its connected approach to technology and organization.
Stephan Schambach is a pioneer in this connected approach. He was the founder of Demandware, the cloud-based e-commerce platform that was sold to Salesforce in 2016 for $2.8 billion – becoming Salesforce’s Commerce Cloud offering. Schambach is now the CEO of NewStore, which recently partnered with UNTUCKit to implement the company’s omnichannel platform.
We invited Aaron Sanandres & Stephan Schambach to interview one another about the state of omnichannel retail, what success looks like today and what type of a playbook they can offer for the future.
SS: UNTUCKit has experienced tremendous growth the last couple of years — why was it important to transition from being solely digital to incorporating a brick and mortar presence?
AS: As soon as we launched our ecommerce site, we were getting requests for physical stores. We knew that some of our customers would want to touch and feel the product but didn’t realize just how large this group would be. Opening our retail locations really gave us the opportunity to create a ‘trust bridge’ between the brand and our customers. Today, having a physical footprint allows us to grow in an omnichannel-fashion. We’re always working to make shopping with us more convenient and fluid for customers, and having stores adds to that smooth experience. It offers us — and our customers — a new point for experiencing the brand and understanding each other better.
SS: What challenges did you face with those first few stores and how have those challenges informed decisions you’ve made today?
AS: One of the biggest initial challenges was forecasting the productivity of all the different locations, because starting from scratch means you have no benchmark or basis to work off. We had to become great at triangulating projections based off the data we did have available and trusting ourselves to make decisions based off what we were seeing. The other challenge any company faces when they expand is ensuring you hire the right people — people who promote your brand and your culture. Getting that mix right is challenging, but so worth the investment.
SS: When did omnichannel become an integral part of the company’s vision? And how has NewStore played into that?
AS: Omnichannel has been a part of the plan for us all along. As we’ve continued to make moves growing our business and physical store count, NewStore has been an integral part of that process. The platform allows us to see that technology component — what omnichannel really means to customers — as they shop, in addition to helping our store associates be more productive and helpful. Our goal has always been to make the omnichannel experience smooth for our customers, so they can enjoy shopping with us online and offline.
SS: In your opinion, what is the future of physical retail, overall and for UNTUCKit?
AS: The future of retail relies on creating a smooth omnichannel experience and growing that experience across every brand channel. And I think SMS commerce will see growth in 2019.
SS: What advice would you give to brands looking to innovate and scale through an omnichannel strategy?
AS: The number one thing I’d recommend to brands is to make sure you know your customer. Not just what they are shopping for, but how they like to shop, what services are important to them and what makes their lives easier. Every brand doesn’t necessarily need to have a physical store to go with their online experience — the most important thing is to know what is best for your customer and make moves in that direction.
AS: Your roots are in ecommerce but at NewStore you’re focused on the in-store experience — What led you down this path and what are you trying to achieve?
SS: Ecommerce has changed the face of retail, especially the in-store environment. But the disruption isn’t meant to eliminate physical retail as much as it is to push retailers to define a new way of delivering customer experiences. Omnichannel is a solution to the ecommerce disruption. Every retailer wants to execute the widest range of omnichannel’s capabilities — but it’s difficult to do. That’s what we’re trying to achieve at NewStore. We want to make it easy for retailers to unlock the potential of omnichannel at scale.
AS: Why has omnichannel been so difficult for retail brands to get right? What steps can retailers take to make the transformation a success?
SS: Most retailers’ tech stacks consist of legacy systems for various operations, which isn’t conducive to today’s digitally-focused way of doing business. These systems aren’t connected, and they can’t communicate — the technologies are more or less cobbled together. The first step to transformation is migrating from point solutions to a cloud-connected platform. These platforms are customizable, extensible, and integratable, within an ecosystem of partners. This will allow retailers to be agile, innovative, and scalable, enabling them to keep pace with the evolving demands of today’s consumers.
AS: At The Lead Summit you talked about how store associates are undervalued. How can brands leverage their associates in an impactful way for the business?
SS: Store associates are a retailer’s greatest asset and deriving their value starts with making them more productive. This includes equipping associates with easy-to-use tools that make customer information available at a touch, from their recent interactions with the brand to their preferences. And building upon that, giving associates real-time access to inventory enables them to connect shoppers with even more product. It’s all about making sure shoppers get what they want, when they want it, how they want it — ultimately building brand loyalty and trust, and driving sales.
AS: What makes NewStore’s approach different when working with brands like UNTUCKit to transform their retail experience?
SS: UNTUCKit is a brand with a spirit for innovative leadership. And with a keen focus on the future, it was critical they have a platform that could scale with them. Conveniently, this is one of the principles of NewStore’s approach — offering the path to scale physical store investment hand in hand with an omnichannel solution. UNTUCKit will continue to be a leader in the space by leveraging its omnichannel strategy, allowing the brand to give customers the experiences they demand, even as those demands evolve.
Aaron Sanandres is the Co-Founder and Chief Executive Officer at UNTUCKit, founded in 2011. Prior to his full-time role at UNTUCKit, Sanandres was a partner at PriceWaterhouseCoopers.
Stephan Schambach founded Demandware, which sold to Salesforce in 2016 for $2.8 billion. Schambach is now the CEO of NewStore.