“Our real estate strategy is actually to upsize – we expect a lot of our locations to become two or three times larger than what they are today,” Managing director Felicity McGahan told Inside Retail Weekly.
“We’ve [already] upsized 25 stores this year, and we’re very happy with the customer response to the experience, as well as the commercial results.”
This new store footprint strategy will be rolled out over the next three to five years, with the recent downturn in other retailers business actually working in Strandbags’ favour.
“Five years ago, we wouldn’t have been able to afford to upsize because we needed the leases to come down before we could even consider it,” McGahan said. “So all of that is working to our advantage now, and the time is right.”
Bucking the trend
McGahan joined Strandbags 14 months ago, coming from over five years of leading the Cotton On Group, and she is focused on ensuring Strandbags remains relevant to the next generation of consumers.
And while Strandbags finds itself within a growth category – with the luggage sector sporting annual growth of around 5 per cent – the changing face of retail inspired the business to look at how it can evolve.
“There’s a saying – ‘the time to fix the roof is when the sun’s shining’,” McGahan said. “I haven’t come in to lead a business that’s broken. To be able to be on the front foot, and be able to grow a business with that positive attitude versus being in a defensive mode, it’s a very different experience.
“We spent a lot of time working through what the vision would be, and to make sure we could all have the vision and rally together as a team around where we wanted to take this business… It was about an evolution.”
In order to achieve this, the brand spent time learning what its current customer base enjoys about it, as well as why other consumers don’t. It was revealed that the customers who don’t like Strandbags often find stores cluttered, or expect more from the shopping experience, and generally want to know more about the brand itself.
These lessons informed the new brand and store direction moving forward.
According to McGahan, much of the brand’s refresh – both visually and technologically – is centred around the concept of ceding control of the shopping experience to customers.
“They’re in control of us. They’re the savvy ones. Sixty-four per cent of our customers have already researched online before they walk into our store,” McGahan said.
“How do we create a space that supports that, and create a story where they can come in and really engage with the brand?
“We understand that the customer wants what they want, when they want it, and how they want it. Whether they want to shop online and pick up in-store, or browse in-store and shop at home. We had to create a digital mecca where all of that could be incorporated.”
The store features handheld checkouts for staff to help customers transact then and there, rather than pushing them into a queue. Video screens line the walls and showcase the brand to the customers wandering in, while the store itself fulfils e-commerce orders, allowing customers to interact with Strandbags as they please.
Strandbags Chadstone will serve as the blueprint for the retailer’s efforts moving forward, with more stores to be upgraded and upsized over the next three to five years.
“We wanted to do [Chadstone] as the best possible expression of how we can do this, and then roll out from there,” McGahan said.
Thirty years of lessons.
The fact Strandbags is looking to expand in a contracting market is not lost on McGahan, who noted how refreshing it is to work in a growth category after years in apparel and fast fashion.
“My whole life has been about apparel. I was very excited to come out of apparel and fast fashion and go into a category like bags and travel, and learn a new category,” McGahan said.
“It’s the same circus, just different clowns.”
However, with many retailers looking to downsize their bricks-and-mortar operations, McGahan notes that the biggest change she has seen over her 30 years of retailing is the customer’s access to information.
“You can’t just say you’re focusing on the customer, and that the customer’s first, and then do something else,” McGahan said.
“They’re savvier than that, they know how much the product is in the other store, they know that if you don’t get it shipped to them quickly, or in-store for pickup because they want it today, they can just go somewhere else.
“The customer is more cautious and wiser with their dollar. They’re still spending – [we just need to] understand it’s their decision where they want to shop. It’s no longer our decision.”