[MUSIC PLAYING] Before I get into specifics about retail targets, I want to quickly talk about the importance of picking your target market. A big lesson we learned at Knix wear, was at the obvious approach, isn't always the right one. In our case, we specialized in active intimates for women. And due to their boutique style packaging and size, they had potential in various markets and types of retailers ranging from lingerie stores ready to wear boutiques, to gift stores, to outdoor sporting goods stores.
We also had a very obvious market we could go after, and that was lingerie. When we decided to focus on the lingerie market to start, we quickly learned that it was a saturated landscape with tons of competition. And a customer that wasn't necessarily interested in technical undergarments and our overall value proposition. On the other hand, the activewear market, which was seeing massive growth was a much better fit. The active customer had an appreciation for technical fabrics and functional garments, so it was easy to convince them of our value proposition and the undergarment category.
As soon as we switched our focus from large rate to activewear, we saw our first big growth spike. Lesson learned, the obvious path isn't always the right one. Compiling retail target lists as a first key step in building out your wholesale channel. You need to think of your retailers as your brand ambassadors and partners, this mindset should inform your target lists. When your wholesale channel is your main source of revenue, it's easy to fall into the trap of going after everyone and everything to get your brand moved, and volume sold, but quality wins over quantity.
For those brands who we're watching this tutorial, you have an established e-commerce revenue channel, which means you have the luxury of being thoughtful and highly selective when compiling your target list of retail partners. A great place to start is looking at the retailers who carry your competitive and complementary brands. By looking at the other brands they carry, you will educate yourself about the retailer. Are they considered high-end or low-end? Are they particular about the brands they carry, or do they offer everyone and everything?
Do they focus on a niche or are they a generalist? Another important thing to consider is the retail landscape in their territory. Are they located in a small area or a larger denser area? Is it considered affluent? Do they have retail competitors in town? Are they located near a big box store? Are they a big box store? In any given town or small city there is bound to be a few competitive specialty retailers. And if that's the case, you will want to pick the right partner, as they often won't carry the same brands in each store.
There are two ideal retail partners to go after. The first is that who carries complementary brands in your price point range, but who currently has a gap in your particular category. So their customer is purchasing brands that would suggest they would be open to your product, but you will need to help them educate their customer on your value proposition. The other ideal partner might carry complementary brands and also a competitive brand in your category.
The challenge here, will be to convince them of your unique offering compared to that of the competition. But the advantage is they will already have a history with the category, meaning they will know the demand and how to sell it. The key learning here, is be thoughtful as you compile your list of target retail partners. They will be your brand ambassadors in the physical world, and you want the right partners off the bat. In the next lesson, and we're going to look at pricing strategy, and how to balance your new wholesale efforts with your direct business.
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