The Modern Retail Podcast

After a difficult 2020 and 2021, women's work apparel brand M.M.LaFleur is once again in growth mode.The company is investing in new stores and showrooms, and says that sales are picking up again after business cratered during the pandemic."There were multiple times where I thought maybe we won't make it, maybe the business won't survive," said founder and CEO Sarah LaFleur. She joined the Modern Retail Podcast this week and spoke about the company's new focus on stores and how it's positioning its overall marketing going forward.M.M.LaFleur is celebrating its 10th anniversary. And its trajectory as an online business provides a great glimpse into the changing dynamics digital brands face. It first launched with a subscription model with the aim of bringing women into the fold and giving them a variety of options to try out every month. While the intent wasn't to solely be a subscription business, M.M.LaFleur was known as one for years.During this time, the brand relied on all the old digital acquisition strategies to grow. "I remember there was a time where we used to acquire customers for $16 per customer -- I mean, it was kind of crazy," LaFleur said.But then two big things happened: customer acquisition costs skyrocketed and the pandemic hit. Beginning in 2019, M.M.LaFleur stopped its subscription business. And it also worked to diversify its marketing budget.Now, LaFleur said that stores have become one of its best-performing customer acquisition channels. "The thought there was let's shift our acquisition channel to now be from something else, and [using] our stores [as] a source of acquisition," she said.The company uses two types of retail models -- showrooms and ground-floor retail. The showrooms have long catered to power M.M.LaFleur customers, giving them an intimate environment in which to shop. Meanwhile, the larger, ground-floor retail formats are intended to catch people's eyes on the streets. It recently opened a ground-floor store in the Upper East Side, is about to launch another in the Upper West Side and has plans to open two more similar stores by the end of the year.According to LaFleur, while these stores don't bring in the majority of revenue -- 90% of the company's sales still come from online -- this is where she really sees healthy growth coming from."In terms of where I'm putting my energy right now, I'm really focused on making sure that the stores we have right now are performing well," she said.

On this episode of the Modern Retail Rundown, we continue to dissect the new economic realities the retail industry faces.This week, we discuss the whispers surrounding Instacart's long and winding road to an IPO and why Nordstrom Canadian ambitions failed. We also contemplate why dollar store chains are receiving so much resistance from the American public.The Modern Retail Rundown is a weekly program where the Modern Retail staff breaks down the week’s top news.

Aviron, which makes a connected rowing machine that starts at about $1,800, is taking a more sustainable growth approach than counterparts like Peloton.The company launched a couple of years before the pandemic hit. The focus was on bootstrapping and slowly building a business via B-to-B sales from wholesalers that would sell to hotels and other large businesses. But then the pandemic hit and the company had to switch its business model. While it did lose money during the first half of 2020, Aviron was able to completely transform itself into a DTC fitness brand -- and has been seeing growth ever since.Founder and CEO Andy Hoang joined the Modern Retail Podcast this week and spoke about Aviron's transformation as a fitness brand.One of the ways Aviron was really able to hit its stride was by joining Y Combinator in 2021. Up until then, the company had been mostly bootstrapped. That wasn't by choice, but because Hoang had yet to find an investor to take the leap. But, according to Hoang, the industry cachet the accelerator program provides really paves the way for future investments."As soon as we got into Y Combinator, a lot of those same investors who said no to us and didn't give us more than five or 10 minutes of their time were asking us: Hey, can we really participate in this round?" Hoang said.Thanks to this funding the company has been able to grow. It now has about 60 employees. And while demand for fitness has cooled of late, the company has not had to make any big cuts or layoffs. Hoang credits this to his focus on making sure sustainability was in front of growth.This is in contrast to some other players he's been watching. "I love Peloton as a brand, I think they've done great things," Hoang said. "I don't understand how they hired so many people in such a short period of time."But even with the industry cooldown, Hoang is still very bullish on the future."There's going to be a lot of consolidation, and there's going to be a lot of companies that just won't make it because they don't have the right fundamentals," Hoang said. "So it's exciting to me, because if we do make it through this period -- which I think will be a challenging period -- the companies that come out of this period are going to be really strong."

Some of the largest companies are making big changes to their business models. That was the overall theme of this week's Modern Retail Rundown, a weekly program where Modern Retail editors break down the week's biggest industry news.In this episode, we talk about how ad sales are boosting revenue for marketplaces like Ebay and Etsy – even during rough times. Next, we discuss how major retailers are warning of a slowdown in demand in the coming year. And finally, we delve into Starbucks’ buzzy new olive oil coffee line.The Modern Retail Rundown episodes drop every Saturday morning.

The brains behind the snack giant Kind are now bringing their expertise to the investment space.Kind founder Daniel Lubetzky unveiled Camino Partners earlier this month, an investment and incubation platform looking to help the next wave of entrepreneurs. The idea is to harness what made Kind -- which sold to Mars in 2020 for reportedly $5 billion -- so successful into a program that will fund the next successful consumer-facing brands. That's no easy task, according to Elle Lanning, managing director at Camino Partners.She joined the Modern Retail Podcast this week and spoke about Camino, and its plans with the $350 million it raised. She also talked about the overall consumer brand investing space, and what industry changes are likely on the horizon."The thesis is heavily rooted in our operating experience," Lanning said.Lanning herself is a Kind alum. She worked at the company for over a decade, starting in the marketing department and ultimately becoming chief of staff. Once the company sold to Mars, Lanning said Lubetzky and the Kind team were trying to figure out their next move. "We've amassed this experience -- we have great talent from different stages and different functions along the way of Kind's growth," she said.But the big question remains: what will Camino invest in? Past investments from earlier iterations of the platform include the snack brand Belgian Boys. As Lanning described it, the focus is on "value creation, from the sense [that] we're supporting products and services that better a consumer's life." That could be a better-for-you snack bar, but it could also be a wellness brand.This fund comes at an interesting time. Money was flowing to consumer startups over the last few years, but things have begun to cool. In Lanning's eyes, the industry may have been too flush with cash, which made it nearly impossible for some companies to stand out. Camino, then, is a way to suss out the real next industry leaders.But that may come at the expense of other brands -- and Lanning is aware of that. In fact, she thinks the next few years are going to be tough."I do believe that there will be some contraction," she said. "I think that [over] the next couple of years, you're going to see some brands that might have had early shoots of promise probably cease to exist."

Modern Retail is excited to unveil our latest podcast: The Modern Retail Rundown.This weekly program, hosted by senior reporter Gabriela Barkho, goes through all the big retail headlines of the week, providing deep analysis and insights into these large industry happenings. We'll bring in guests such as reporters and editors who know retail inside and out to discuss why these stories are important, and what they mean for the overall ecosystem.This week, we talk about Amazon's grocery ambitions -- and how the company says it's investing in brick-and-mortar stores while also scaling back some recent investments. We also dived into the latest from Bed Bath & Beyond, which narrowly escaped bankruptcy thanks to an 11th-hour investment. And we also discussed rumors that Away is looking for a buyer -- and what that means for later-stage DTC brands seeking an exit.

Sundays is trying to become the leading DTC home furnishings brand in Canada, but it also has its sights set on international expansion.The company started as a side hustle of two married entrepreneurs and has snowballed into a full-blown international business. While most of its business is in Canada, Sundays has been slowly building out its U.S. business -- and has plans to open a pop-up in the country hopefully sometime in the next year."We started just with living room pieces, and over time we moved into dining room and bedroom," said co-founder and co-CEO Barbora Samieian. "But what we really stayed committed to is that curated line. So, not going very broad in any of those categories, but really selecting the best pieces for our customers and iterating on those pieces."Barbora and her husband Moe, who serves as the other co-CEO, joined the Modern Retail Podcast this week and spoke about the company's growth plans.Sundays first launched in 2019, and after about a year of trial and error -- along with a pandemic-induced home goods boom -- started seeing sales consistently grow year-over-year. Sundays sells a variety of home furniture including sofas, end tables, beds and chairs. While it has expand its product-line, the co-founders insist that its focus has been on curation over expansion.Much of its growth was thanks to leveraging social media and local influencers to grow its presence in key cities like Vancouver and Toronto. But now, with rising customer acquisition costs and changing digital dynamics, Sundays is trying to diversify its digital marketing to include a variety of channels including podcasts and Pinterest.While the co-founders admitted that the last six months didn't have the same growth as the previous two years, given the changing economic landscape, things are still looking good for Sundays."We're still able to have growth numbers even in q3 and q4 of 2022," said Moe Samieian. "But we've been we're going forward cautiously."

For years, Nutrafol has focused predominately on DTC. But now it's taking a big step into retail.This month, the hair wellness brand started selling in Sephora. It's one of the first big wholesale relationships Nutrafol has made. Though it's been around since 2014, Nutrafol -- which sells supplements to help with hair loss and other health issues like menopause -- has sold predominately on its own site, as well as Amazon and in certain physician offices. This has remained the case even after it got sold to Unilever last year.According to Giorgos Tsetis, co-founder and CEO of Nutrafol, "the Sephora partnership is really serving as credibility, but also just brand awareness overall." That is, it gets the brand's name in front of more people than it ever could before.Tsetis joined the Modern Retail Podcast this week and spoke about the company's evolution. Nutrafol started as a laser-focused wellness startup. It had two formulations to help both men and women with hair loss. A few years ago, it expanded to help with more ailments but has aimed to stay true to its promise of providing researched and lab-tested wellness products."There's skepticism with supplementation in general," he said. "And that's for the right reason because there are a lot of companies that are manufacturing supplements and making claims that they cannot substantiate." But, he said, Nutrafol has been focused on educating its customers to explain how it works and what exactly it does.That's easier to do on its own website, but now the company is trying to tell its story to more people by expanding retail channels. But not every channel will have the same expectations as the others. For example, about 85% of the customers on Nutrafol's website are subscribers. That's not the same with Amazon customers. "As we scale, understanding the ratio between these channels is going to be very important," said Tsetis.For now, the focus is on figuring out how to make each channel work and growing Nutrafol's presence. While the company is dead set on making its Sephora partnership work, it may have some other announcements soon."With the Unilever infrastructure and resources available to us, I think the most impactful move in the next few years is going to be about scaling globally," said Tsetis.

XRC Labs is looking for the next consumer brand winner.The organization is both a venture capital fund and accelerator that has been around since 2015. Its portfolio companies include Outlines, Caraa and Billie. Partner Diana Melencio is constantly trying to figure out what's next -- and what market is under-tapped.On the Modern Retail Podcast this week, Melencio spoke about her investing process and the areas she's most excited about for the year to come. For example, she sees men's skincare having a moment soon. She also sees older generations as a demographic that remains overlooked by many startups."Women over 40, women over 50," Melencio said. "They're a demographic that has some of the highest purchasing power in the world in the country. They're at a stage in their career where they have a lot of disposable income, and there are very few brands that try to directly speak with them."One of XRC's main theses is that digital is the way of the future for consumer-facing brands. And even though foot traffic is coming back to some stores, there is still too much under-utilized retail space. If you go to a mall in suburban New Jersey or Connecticut on a weekday, she said, "there are not a lot of people shopping there." As such, she's looking for ways that companies can rethink the spaces they once relied on.But perhaps most top of mind for her -- and most entrepreneurs -- is how to stay afloat given the current economic uncertainty. It's true that it's tough to raise money as a startup right now, said Melencio. But now is when brands can prove they have longstanding business models that can outlast downturn."The first thing is that you should be profitable on your first sale," said Melencio.

Seed Health is a microbiome company trying to disrupt the way health, business and science overlap.While its first product is its probiotic line, Seed has more lofty ambitions to do deep research into human health and rethink the way most people think about the microbiome. The microbiome technically is the community of microbes that live inside an organism, but it's most commonly referred to as a generalized term for human gut health that supplements like probiotics help to support.On the Modern Retail Podcast this week, co-founder and co-CEO Ara Katz spoke about the company's growth and its big plans for the future. It raised a $40 million Series A in 2021 and it just announced a new partnership with a Swiss research institute to help develop a new line of home and personal care products. Its first product, Seed, comes in two versions -- adult and pediatric -- and are daily non-prescription probiotic supplements that go for about $50 a month. The overall goal of Seed Health, said Katz, is "to realize the potential of the microbiome to improve human and environmental health."But with such a big mandate comes a lot of work -- and some of that has to do with branding and marketing. For example, the very concept of a microbiome may be foreign to most people. For someone like Katz, who works with scientists and influencers, that means figuring out the best way to explain the company's message.According to Katz, it means wearing a bunch of hats and figuring out the best method of communication for the audience at hand. "We write Nature papers and we write Instagram posts," she said. "And they're wildly different."With that also comes the task of figuring out sales growth. For now, most of Seed's sales come from its website, but it has been dabbling in brick-and-mortar retail. For example, Seed supplements are available for purchase at Erewhon. But even that isn't a straightforward wholesale partnership -- because Seed relies on a subscription model, Erewhon and Seed have an affiliate relationship so that the store gets a cut of sales even after the first in-store purchase.The Erewhon partnership, she said, is working out "better than we thought better than we thought it would."For now, the focus is on growing Seed Health's research which will go into its new products. "Now that we we have an understanding of what we believe -- and we know the efficacy of our first few products," she said. She's now figuring out "how do we scale them in a way that creates the greatest amount of health impact."