Sustainable by Design

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by: David Wigder

An Interview with Ian Yolles, VP of Marketing, Nau

What if you could build a company from the ground up, where every decision was based on the principles of sustainability? Nau is an emerging outdoor apparel company that is trying to do just that. In fact, even its corporate bylaws state that fiduciary responsibility to shareholders must be balanced by the needs of the environment.

In doing so, it is going to market with a three point differentiation strategy:

  • Sell high-performance, high-design apparel made solely using sustainable sources and practices
  • Transform the traditional retail concept into a physical “Webfront“. In this setting, consumers can browse and try on the apparel in a gallery-like setting, but are provided with an incentive to order through kiosks and have merchandise shipped to them – much like an e-commerce experience. This allows the store to have a smaller footprint, carry fewer inventories, and reduce operating costs and the overall impact on the environment.
  • Engage consumers in the brand through active dialogue (e.g., blog) and philanthropic giving (5% of sales donated to one of a list of charities)

Sustainability is often viewed as a competitive handicap. Few companies have been successful in building their brand while adhering to such principles. Nau’s plans to revolutionize the product, the retail space and consumer experience simultaneously are ambitious and will test the size and loyalty of the emerging eco-friendly consumer segment. This is a brand to watch as we move forward toward a more sustainable world.

I recently spoke with Ian Yolles, Nau’s VP of Marketing. Here’s what he had to say:

MG: What are your key brand attributes?

IY: Performance, sustainability and beauty.

MG: Will your brand resonate with eco-conscious and not so eco-conscious consumers?

IY: Absolutely. I do not believe we will be successful solely on the basis of sustainability; the product has to do a lot more. If you look at our product, for anyone who leads an active life…if you look at it visually, you will see performance cues and design cues…and have a differentiated point of view to make it successful on those two attributes alone.

MG: Is a business that sells sustainable products itself sustainable?

IY: We get asked that a lot. “Isn’t this a passing fade or trend”? Our point of view: Interest in sustainability reflects a much deeper and much longer shift and does not reflect a passing trend. Evidence to suggest this? Look at GE. Last year they announced ‘ecoimagination’. One effect is that it impacts [GE’s] marketing. It also reflects a shift in thinking at GE. This was not driven by purely an idealistic view but rather because it’s good for business.

MG: How will you revolutionize the retail environment?

IY: [Nau’s point of view] comes from a broader perspective about consumer shopping behavior. In 2006, we see that the Internet has influenced how people are learning, getting information. It also has influenced shopping behavior: People often start online by doing research; particularly in the case of an apparel product, they want to try it on and then go home and find it online for the lowest possible cost. In e-commerce and traditional channels, no one has connect the dots to reflect changing behavior of consumers. We are connecting the dots for them.

MG: How does it work?

IY: “Webfronts” integrate the website shopping experience with the storefront shopping one. If you want to buy it [at the store], you can do it. There will be sales reps there and POS terminals there. But, we will incentivise you to make a different choice: Purchase at an [in-store] interactive display. Shipping is at no extra cost, and we will offer you a 10% discount.

The outdoor and broader sports industry is structured as a wholesale model. With “webfronts”, we are taking out the middle man. Webfront efficiencies [such as smaller store footprints, centralized inventory, fewer inventories] and flexibilities change what you can do with the business model. [For example], we will engage every one of our customers directly and experientially in the giving process with a direct donation [via 5% of sales to the philanthropy] of their choice. The current benchmark is Patagonia at 1% of sales. 5% is well beyond what corporate America is doing.

MG: How else will you interact with your consumers?

IY: Through participation, dialogue and engagement. The brand has to have one identify and clear point of view. But the world is changing, and the idea is to have a brand that invites dialogue, engagement. We launched through ‘The Thought Kitchen’ (blog). It is the location where people engage in ideas. We aspire to be very authentic, transparent in how we communicate with them.

MG: Will competitors follow your lead?

IY: It will be very hard for competitors to adapt. We are a direct business; other companies are tethered to a wholesale model. Any change will cause conflict between the channels. Transition for them would be very difficult. It also takes a different mindset to operate a direct business versus a wholesale model.

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