The Tale of Two Retailers and the Rise of Indie Brands

Earlier this month, two of my favourite fashion brands made major public announcements.

David Lawrence, an iconic Australian fashion retailer established in 1978, announced that receivers had been appointed, with the immediate future of its 52 stores, 11 outlets and 1130 staff in doubt.

A week later, Spell Designs, a cult Indie brand founded in Byron Bay in 2009 released a short film clip to celebrate the release of its new collection and collaboration with leading fashion influencer Sarah Ellen.

While the Spell film, shot in Paris, was garnering international publicity and a share a minute on social media, commentators and analysts were reacting to the news that David Lawrence had been placed into administration, with many jumping to blame the brand’s demise on the rise of fast fashion.

One retail expert even boldly summed up David Lawrence’s demise as being a pure value proposition. “I can go to a fast-fashion outlet and buy three or four outfits for the price of one from David Lawrence and it will look great and look new and fresh all the time,” he said.

David Lawrence simply became too expensive in a shifting market bursting with cheaper choice? A flawed theory when you consider the spectacular success of Spell Designs, where the per-garment price tag would exceed that of a piece from David Lawrence.

So how did David Lawrence slide into oblivion? Quite simply, it lost the battle for relevance, lost its edge and persisted in marketing to a modern consumer using a decade old retail strategy.

Sadly, the extent of the brand’s failure to adapt to a changing consumer is blatantly evident in one paragraph from the David Lawrence website:

Apart from the language lacking any warmth or engagement, aiming to be a ‘the premium retailer to the working woman’ speaks of a one-dimensional, categorical view of their target audience and not a message that today’s millennials (or Gen X-ers for that matter) relate to. Millennials have a far too nomadic outlook on life to ever resonate with a ‘working woman’ label and Gen X-ers, as much as we value our careers, are busy juggling several other life roles — so much so that the ‘working woman’ tag feels superfluous, outdated and redundant. It’s not a strong, unique brand proposition. It’s certainly not aspirational.

Take a journey through the Spell Designs website, in contrast, and you’ll find a very different approach to customer connection. It’s whimsical, mesmerising and full of inspiration. Each garment tells a story beyond the fabric, design and stitching — it screams lifestyle and transports you a free-spirited, bohemian existence where life is simpler, crochet bikinis are in and friends gather ocean side, at festivals or at Kombi-clad campsites. It’s no wonder 70% of their sales are online.  In fact aside from 100 or so stockists globally, Spell Designs currently has just one flagship store in Byron Bay.

So what can we learn from the tale of these two retailers? How has Spell designs captured the imagination, hearts and wallets of the market, while other premium fashion brands are teetering on the edge of the abyss?

The rise of millennial consumers is changing the game for fashion and many other categories. Millennials are entering their peak purchasing years and they are hungry for what’s new and trendy. Their nomadic outlook on life is reflected in their brand choices and shopping behaviour. They seek out journeys of discovery and brands that speak to an aspirational, nostalgic view on the world. They work to live rather than live to work. Spell Designs has evolved beyond clothes and accessories — it’s a complete lifestyle brand that reflects the values of the modern generation.

Today’s consumer is living a busy existence. She’s time poor, distracted and spending more and more or her day online. Her spheres of influence have shifted from mainstream to social — online and offline.

David Lawrence completely missed the boat here. The brand has an Instagram following of 5,500 with minimal engagement and an apparent lack of digital or social media strategy. In contrast, Spell Designs generates a significant proportion of sales directly from Instagram, with an enviable following of 742,000 and extensive support from fashion bloggers and Instagrammers. While David Lawrence has been spending hundreds of thousands of dollars on billboards and magazine ads and maintaining an expensive physical retail footprint, Spell Designs has been forming partnerships with Instagram Influencers and producing breathtaking videos showcasing their clothes in locations like Paris — for a fraction of the cost and an exponentially greater result.

The Spell Designs brand transcends its garments and accessories. It offers an entire lifestyle experience and whether you engage with them on social media or purchase an item through their website, every touch point exceeds expectations and creates a ‘wow’ moment.

Their flagship store in Byron Bay is the epitome of destination, experience-based retailing. It not only provides customers an opportunity to try on, touch and feel all things Spell, it offers a full immersive experience — from store tours and even on-site accommodation in the Spell-designed Cactus Rose Villa. Staff are welcoming and engaging. Customers are offered refreshments. From start to finish it’s a retail experience worth raving about.

In contrast, the David Lawrence brand experience is bland and uninspiring. Their website is crawling with studio images of pale, lifeless models. In store, the customer service is poor, the lighting is harsh and the stores look like they did a decade ago.

Most Spell Designs devotees could recite the Spell story, as it’s cleverly woven throughout their brand. It’s an intrinsic part of their brand’s DNA.

In 2008 Isabella Pennefather (Spell) was selling her vintage-inspired clothes and jewellery at the Byron Bay markets. Although she was gathering a loyal following of local customers, it was subject to the constraints of a successful hobby business. It wasn’t until Spell’s sister Lizzy joined the business that things catapulted. While Spell remains the design and creative force behind the brand, Lizzy (who has a background in graphic design and film production) has brought structure and marketing prowess to the business and enabled it to grow exponentially. It’s a dynamic combination and a story that has enabled the brand to enjoy massive media exposure. In 2016 Spell Designs was named the National Telstra Business of the Year.

Spell and Lizzy are a wonderfully visible and vibrant part of the Spell brand – they epitomise their target audience and share their personal expression of the brand regularly on social media, bolstering the emotional connection they have built with their followers.

Most importantly, they provide their loyal customers multiple channels to engage with the story — online and offline — even releasing an exquisite 300-page coffee table book in 2015.

Spell Designs is just one example of the explosion of start-up and Indie brands gaining significant traction in the marketplace due to the barriers of entry being removed and online sales channels being easier than ever to launch.

But Spell’s success is more than just an e-commerce stroke of luck. Scroll through the Spell social media feeds and you soon see that this is a brand that puts the customer at the heart of everything they do. Customers are heavily involved in nearly every aspect of the brand. Their insatiable thirst for all things Spell is rewarded in the form of behind-the-scenes footage from shoots, sneak peaks of new arrivals, and insider info on sales and new arrivals.

While being a David Lawrence ‘VIP customer’ gets you a monthly text message advising of in-store discounts, Spell members are part of a highly engaged community, with many initiatives and designs being inspired by feedback directly from consumers.

It’s a distinctly two-way conversation and customers are connected to each other, which strengthens the connection they have with the brand.

The fall of David Lawrence is a great shame for Australian fashion and a sad outcome for the retail sector in general. It serves as a warning for us all that even a quality product will sit on the shelves if the label bears a brand name that has lost relevance with consumers.

The Spell brand, aside from being testament to the rise of Indie brands, delivers a masterclass in modern marketing that can be adapted for any brand in any category.

Two brands with a very different story and sadly, far from a fairytale ending for David Lawrence.