While the rise of the digital economy has put some retailers out of business, it has helped others exceed their performance goals. Two challenger retail brands that come to mind are Elvie, a British femtech company helping support women in all stages of their lives through smart technology, and Naked Wines, a direct-to-consumer wine business in the US that boasts 500,000 customers worldwide.
During a virtual panel at Advertising Week entitled “Against All Odds: The Challenger Retail Brands Thriving Amidst A Pandemic,” Beth Horn, Facebook’s head of industry, retail and ecommerce, hears from Aoife Nally, global marketing director at Elvie, and Jo Gunn, growth director at Naked Wines, on how they navigated the crisis and connected with communities amid the changing retail landscape.
Despite the pandemic, Elvie was able to launch digital-first in seven European markets this year. At the peak of the crisis, consumers showed an increased interest in the brand’s two products, a pelvic floor trainer and a silent wearable breast pump, given the items are focused on health, Nally says.
The brand still had its share of challenges, including updating its pre-pandemic tagline, “Pumping on the go,” doing more frequent forecasting and maintaining prudent cash management. For Elvie, this meant balancing the short-term health of its business while protecting its future growth, namely continuing investments in R&D and its workforce.
Leaning into digital community-building initiatives helped Elvie overcome some of these hurdles. To lay the groundwork, Elvie conducted a survey to understand how the crisis was affecting their target audience’s mental health. The results revealed that 51 percent of British moms were struggling with their mental health, 67 percent of which didn’t know where to get help. Based on these findings, Elvie launched a digital content series called #AtHomeWithElvie, which offered postpartum depression tips, comedy sessions, cooking tutorials and poetry readings.
Elvie’s research also showed that 48 percent of women were turning to exercise as a form of escapism. In turn, the brand teamed up with UK’s leading pregnancy charity, Tommy’s, to launch a purpose-driven campaign, #TheBigSqueeze, which involved a nationwide pelvic floor workout on Elvie’s Instagram Live. Participants were encouraged to follow the workout, share a selfie of themselves mid-squeeze, nominate friends and donate to Tommy’s. Elvie pledged to match donations in the first 48 hours, up to £5,000.
“The true winners need to have their finger on the pulse constantly, continue to grow their digital offerings and lean into data. So getting as close as possible to the customer, whether that means launching new target campaigns that focus on health and safety, adapting pricing and promotion based on customer feedback or reevaluating spend and optimizing what’s working,” says Nally.
Nally adds that in order to future-proof their brands, retailers must adopt a health-first strategy to keep up with the rise of conscious consumption.
For Naked Wines, the biggest challenge posed by the pandemic was serving its customers, or “Angels,” as demand shot through the roof across the board overnight, according to Gunn. So much so that the company had to shut everything down for a few days to ensure its warehouse and logistics were operating safely.
While some brands have observed a drop in consumer spending, Naked Wines has seen the reverse. Gunn notes that its customers are less price conscious, perhaps because lockdown life has inspired them to treat themselves to more affordable luxuries or because they’re happy to spend more to shop locally.
In addition, the pandemic helped Naked Wines attract a new demographic—wine drinkers in their early 30s who pre-pandemic didn’t really consider buying DTC wine. With unprecedented levels of demand and a better-than-usual return on acquisition spend (ROAS), Gunn says she’s been able to test and learn in areas that originally were too costly.
Cultivating community has also been top of mind for Naked Wines, according to Gunn. In the early stages of the pandemic, the company heard from its Angels that they were feeling isolated. To lift their spirits, Naked Wines hosted a “Thirsty Tuesday” wine night on Zoom. Thousands of people joined the call, and the activation became so popular that the company made it permanent.
Furthering its mission to give back, in April Naked Wines announced a $5 million support fund for independent winemakers worldwide affected by the closures of restaurants and bars. The fund was deployed to purchase stock that was previously destined for restaurants, tasting rooms and retail stores. The brand also gave winemakers who applied and were selected access to its 500,000 customers in the US, UK and Australia, plus the chance of a permanent listing.