Off on some cushy junket to the States recently, B&T’s tech editor and Which-50.com editor Andrew Birmingham stumbled upon the remarkable men’s suit label Alton Lane. Clearly no fashion horse himself, here Birmingham regales his pleasure of this 21st century retail experience..
Most companies imagine themselves to be customer focused. Most aren’t. But a rare few genuinely live the meaning of it every day, and build customer experiences that are a direct extension of brand and culture.
Alton Lane, the bespoke men’s tailor currently operating in seven US locations and with grand ambitions to open six stores a year on its way to 200 locations, is ticking all the boxes of the modern omnichannel merchant.
It’s Friday morning and co-founder Colin Hunter (pictured above) is sitting at the fully stocked bar of his Manhattan store, seven floors above West 25th Street and the heat infused hustle of an unusually warm New York September day. The NFL is playing on the flat screen television behind us while Hunter talks enthusiastically about the 31-foot bus his company has refitted into a rolling suit shop, along with his plans to do the same with a yacht.
There is a floor-to-ceiling bookcase in the corner that opens – James Bond style – into another secret and bigger bar where customers get fitted out (or sometimes just take a drink when they drop in to chat).
And in the corner there is a booth that looks suspiciously like one of those infernal X-ray machines US customs insists on walking us all through these days. But in fact it’s a body scanner that captures 300 distinct data points and helps Alton Lane’s staff to get you as close to a perfect fit as possible.
This is not your average suit shop, and Hunter, who trained to be a GP before taking a turn into private equity at Bain, is not your average tailor.
The thing that strikes us most about the Alton Lane CEO is how carefully he has thought through the customer experience, and how that experience provides the bedrock of the enterprise. Too many companies still think customer experience starts with design. Insurgents like Alton Lane’s Hunter and fellow founder Peyton Jenkins understand that it starts with culture, and informs every decision of the business.
Even today many of the big box retailers consider the customer’s experience purely in the abstract. For Alton Lane it is a core operating principle for a business that wants to rewrite the rules around how men shop for clothes.
“The idea for Alton Lane started partially from my work in private equity, and seeing some trends in the industry that I felt were not sustainable,” says Hunter.
“If you were to poll a room full of a hundred guys and say ‘how many of you, when you leave the house, want to look good? How many of you feel great when someone says ‘Hey you look really sharp’? Well everyone is going to raise their hand.
“But if you were to ask them, ‘How many of you guys can’t wait to get out and shop to buy those clothes?’ then not a single hand is going to go up.”
The problem for many retailers would start as soon as they tried to analyse the results from such a simple experiment.
According to Hunter, “This a problem that people felt they understood– that men don’t like to shop.”
The industry decided the solution was to try and minimise the pain, he says. “The problem is that minimised pain is not very inspirational.”
Instead the solution he says, is to genuinely put the customer first.
“Let’s redefine what shopping feels like. So for us one thing we said was ‘Let’s bring in the bar. You can have a drink while you shop. You’ve got the TV where you can watch a football game.’ That’s an immediate improvement for a lot of guys .”
The bookshelf and the secret room behind it are all part of the “surprise and delight” approach the company takes.
All the technology, from the Netsuite’s ERP solution to Alton’s Lane’s 3D body scanner is done with the customer in mind, he said.
“On the measurement side, men told us ‘custom is great but there’s something uncomfortable about an old guy putting his measuring tape around you for thirty minutes’. We asked ourselves, is there a better way we can do that and we started researching. The scanner allows us to capture 300 measurements in 30 seconds.”
Just as importantly it provided a better experience that also reduces the costs and provides the company with better data for a better fit.
“It is just a more enjoyable experience.”
Customers are people, not transactions
Hunter says the goal was to redefine what shopping feels like from an experience perspective and then to remove those elements of the traditional retail business model that make it harder to deliver value to a customer.
Technology and in particular data are critical to Alton Lane’s plans – and its eventual goal of providing a “Pandora like” experience for men when they shop.
“Pandora’s great algorithm is that it learns what you like over time then it will play songs it thinks you like. Importantly it becomes a platform for discovery. We want to do the same thing for clothing. We can learn what you like very easily. By talking to you for 10 minutes we can learn that you like solid shirts or you don’t like checks. You might like white and blues but not pinks and reds. That’s all great to know when you come into our store.
“But we also want you to have a unique online experience. When you log onto our website we want you to only see the product that fits within the general category of things that you like or things we think you like as best we can determine.
Ultimately then, Alton Lane wants to deliver hyper personalisation through every single channel.
Data is critical to all of this, of course, and for Hunter the point to keep sight of is that the data is primarily there to enhance the experience, and not simply to provide an ingredient to a marketing campaign.
“You can’t be an experience company without data. It is the foundation. What data allows us to do and the technology allows us build is better customer relationships Those relationships drive better customer loyalty and loyalty drives stronger customer lifetime value which is what everyone in the industry wants.”
For their part, customers want access and they want options.
“Lots of options,” says Hunter.
But retailing has not changed in one important way – people don’t like cost and lots of options tends to equate to extra cost. But again, the company’s approach to data centrality and inventory provides a buttress. Indeed its suits range from several hundred dollars to five figures. The key point is that the customer has a choice.
“What’s interesting is that we actually have a lower cost model than typical retailers.”
In the US, the industry uses the ADEX sales per square foot as the national average and Hunter says Alton Lane only pays 10 cents in the dollar in terms of cost per square foot against the national average.
“We are in prime areas but just not ground floor. When I looked at Barneys, for example, a customer has to go up seven floors anyway to get to the men’s section but they are paying for floors one through six. As a customer I’d rather not have to pay for that.”
The majority of work Alton Lane does is custom and its customer are provided access to over 3000 fabrics. Inventory management is critical and data is core to data.
“Even for products that are not custom, like our Italian ties we are doing small batches. With access to our data and knowing our sell-through rate we don’t need two thousand ties. We can get 20. It’s less risky from an inventory perspective and we can adapt faster to the needs of the customer.”
Technology underpins this of course.
“At the backend the foundation is Netsuite. It is really great in terms of giving a common access point. Our factory data comes into it as does our customer data. There are a lot of companies out there with a lot of data and many don’t know what to do with it.
“So what we needed from Netsuite was a robust system that was easy for my team to use and was also easy for us to extract the data in a relevant way,” he said.
The ERP system also plugs into customer facing technology like the iPad app and the 3D body scanner.
“Since they plug into Netsuite that allows us to not only capture the design of your product, and your measurements, but also more of the qualitative details – for instance your favorite drink. (“Single malt Scotch whisky, neat, since you’re asking.”)
Given the importance of the kind of customer culture Alton Lane is building, it is hardly surprising that Hunter runs the same lens over prospective technology partners.
Agility and flexibility
“For me, flexibility is number one. My general approach to anything is I tend to be very results driven. A lot of tech providers come with a lot of promises but also with a high price tag.
“My philosophy is ‘show me it can work’ whether it’s on the marketing side or the back-end solution side. Show me it can work and produce real results for me. If you believe in your product enough and you have done your research on my company then you should have a high degree of confidence.”
Alton Lane, like a lot of retailers these days wants to see the cut of a suppliers’ jib. “We want a good test period. If it works I’ll put a lot of money behind it and continue to pay for it.”
The companies who are the most forward thinking are the one who respond to that, he says.
“The most expensive piece of technology is the one that your team won’t use,” he concludes.
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