For years, SurfStitch followed a familiar online retail formula: Heavily discounted branded product, with a customer base conditioned to wait for the next sale.
Now, 10 months into a restructuring led by Olvera Advisors, the online retailer is attempting something considerably harder than cutting costs or rebuilding a website: It is changing why customers believe in SurfStitch.
The business has been relaunched as a pure-play marketplace built around Australian coastal culture, with a curated assortment spanning surf, street, outdoor and adjacent lifestyle categories. Behind that shift is a strategy designed to restore price integrity, give brands greater control and turn SurfStitch from somewhere people visit for a bargain into somewhere they return to even when they are not shopping. Into a community, even.
“We are moving SurfStitch into more of a trusted lifestyle platform that happens to sell product,” Damien Hodgkinson, principal at Olvera Advisors and lead on the restructuring and platform redesign, told Inside Retail.
Breaking the discount habit
SurfStitch’s reinvention follows a turbulent period. In March 2025, Best Markets Group acquired SurfStitch from Alquemie Group with plans to reposition the business. When it could not reach an agreement with its landlord and a major supplier to withdraw a winding-up petition, Olvera was appointed to undertake a formal restructuring through voluntary administration.
Olvera subsequently proposed a Deed of Company Arrangement supported by major suppliers, including petitioning creditor Nike, before redesigning its operating model and technology platform.
One of its biggest challenges was inherited, not technical. Olvera acquired a customer database of around 1.7 million people with SurfStitch, but many had been trained to expect discounts.
“For the last three years under Alquemie, SurfStitch essentially became a discount platform, and you have to do a lot of work to re-educate that customer that the site is back to being full price,” Hodgkinson said. “Some people won’t return.”
Under the marketplace model, brands control their own discounts but agree not to use SurfStitch as a dumping ground for excess inventory. Outside specified promotional periods, core ranges must be offered at full price or at prices comparable to the brands’ own websites.
SurfStitch also avoids putting all of its approximately 75 predominantly Australian brands on sale at the same time.
“We don’t want SurfStitch to be a digital flea market. It will have a strong editorial and visual point of view,” Hodgkinson said.
That curation is important because the marketplace model creates an obvious temptation: Keep adding brands to increase gross merchandise value. Hodgkinson argues that doing so would undermine SurfStitch’s point of difference.
“If you go to a platform like The Iconic, there’s too much. There is no level of curation, there is no level of endorsement,” he said. “As a small brand or a unique brand, how do you stand out among 6000 brands?”
Giving shoppers a reason to return
SurfStitch’s answer is to build utility and content around the products rather than rely on products alone.
Its Guides hub now includes three services: A Surf Guide scoring 100 Australian beaches daily according to conditions including swell, wind and tide; a Hikes Guide detailing trails, distance, time and terrain; and a Gig Guide covering music and festivals at coastal venues.
The aim is to connect commerce with the activities customers might use the products for.
“We’ve built the gig guide, which is then linked to traditional fashion retail. So what do you wear to the gig?” Hodgkinson said.
The same approach applies to hiking and surfing, creating pathways between content and commerce in both directions.
“People are starting to identify with the platform as being more lifestyle-oriented,” he said. “In the same way that experiential lifestyle is being built out in traditional retail, we had to do the same thing online.”
Social media is another component. SurfStitch has reintroduced hashtags encouraging customers to share hiking and coastal imagery, which the brand can then repost.
“What we’ve done is effectively create lifestyle markers that our customers can identify with and can come into our site for anything other than purchases.”
The data generated by those interactions also gives SurfStitch a clearer picture of customers’ interests. For example, someone who repeatedly uses hiking content can receive more relevant communications and product recommendations.
That has also broadened the assortment beyond fashion. Surfboards, electric bikes, water bottles, towels and other products are being added where they fit the lifestyles SurfStitch wants to represent.
Rebuilding the technology underneath it
The reset required a substantial simplification of SurfStitch’s technology stack. Olvera says annual fixed IT costs have fallen from close to $1.2 million to around $400,000, while its HubSpot CRM has been restructured to work with its marketplace platform and Shopify.
“We have reduced the complexity of the tech platform,” Hodgkinson said, adding that AI has helped the team build some of the integrations required to connect systems more cost-effectively.
The cost structure has also become increasingly variable, with transaction, marketplace and Shopify fees tied to volume. That gives the business more capacity to scale without rebuilding a large fixed-cost base.
But AI is changing more than SurfStitch’s back end. Hodgkinson says shoppers increasingly arrive directly at product pages after AI tools research and filter products on their behalf. That makes detailed product information more important because machines need specific attributes, not broad marketing language, to understand whether an item fits a shopper’s requirements.
“It’s doing the research from a product page up, not a platform down; that’s the big difference that we’re starting to see.”
That creates another problem for marketplaces selling branded products available elsewhere. Once an AI tool identifies the exact item a customer wants, price and delivery can decide the purchase.
Green shoots of success
Clearly, the lifestyle focus is bearing fruit as SurfStitch builds something beyond the transaction.
Early signs suggest customers are beginning to respond. Hodgkinson says sales are building month by month and email open rates are improving as communications move away from constant promotions.
The longer-term test will be whether SurfStitch can turn that engagement into a defensible niche. For now, it focuses on Australian coastal life, with snowsports expected to extend the proposition next winter.
For a business once heavily dependent on discounts, the change is significant. SurfStitch is betting that the way out of the marketplace price war is not to sell everything to everyone, but to give a defined group of customers a reason to belong.
