DEATH OF PUREPLAY RETAIL

INTELLIGENCE REPORT DEATH OF PUREPLAY RETAIL CUSTOMER ACQUISITION

Store Expansion Builds Brand Equity While an initial store opening often translates into PR buzz, search data suggests that the boost in awareness does not fade after the initial media attention surrounding an e-tailer’s first brick and mortar venture. On the contrary, online traffic tends to increase with the build-out of an offline retail footprint. For the 19 evolved pureplay retailers examined in L2’s analysis, retailers with more stores were searched by-name on Google more frequently per month, suggesting that stores drive increased brand equity. Scale is reached at the 15-store mark; retailers with more than 15 stores averaged roughly double the number of monthly searches than those with fewer than 15 stores (237K searches / month versus 101K searches / month). This relationship is also much stronger than the slight positive relationship (R=0.06) between the years since a retailer’s founding and monthly search volume, suggesting that stores can have even more of an impact than retailer longevity on brand awareness.

Death of Pureplay Retail: Number of Stores vs. Average Monthly Searches for Brand Name September 2015, n=19 Evolved Pureplay Retailers

500K

Birchbox

Athleta

400K

Warby Parker

Nasty Gal

R 2 =0.23751

300K

Rent the Runway

Monthly Keyword Searches

200K

Bonobos

100K

Yogibo

0

0

20

40

60

80

100 Number of Stores

Source: Google Keyword Planner | L2 Intelligence Report: Death of Pureplay Retail, January 2016.

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January 12, 2016

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