This week, a look at the business model of the new SoHo store The Den, which aims to grow a cult following. Scroll down to use Glossy+ Comments, giving the Glossy+ community the opportunity to join discussions around industry topics.
Minimizing risk for brands and offering valuable experiences for target customers, the concept store is gaining strength as a “future of physical retail” contender — and fashion companies are placing their bets accordingly.
One such brand is Blvck Paris, the French fashion brand that physically entered the U.S. market through NYC’s new multifaceted retail space The Den. The first store concept by Sharefront, started by realtor Yaron Cohen, The Den’s interiors and products focus on the color black, catering to New Yorkers’ signature style. Customers can visit the on-site Ground Central Coffee shop, EditionX magazine stand, Blatt Billiards game lounge, bar and recording studio, on top of several shop-in-shops featuring apparel and accessories brands. Along with Blvck Paris, there’s high-end men’s brand Inimigo, NYC-based denim company NTK NYC, jewelry-focused Olive & Chain and cologne boutique Lost Tribe. The Kardiel furniture peppered throughout the space is shoppable, as are the Blatt billiard tables.
“In the future, almost every store will have a shared concept,” Cohen said, listing a range of other companies that have benefitted from sharing space. Among them: Capital One Café; Macy’s and Toys R Us; and Dunkin’ Donuts, Baskin-Robbins and Subway. “Companies with the same client are [finding ways to] save on rent while also gaining foot traffic. … We are the cheapest and most accessible way to do retail right now.”
The Den’s partnerships with its tenants vary, said Cohen. Some operate on a consignment basis, some leverage a “subscription model” and pay rent, and others pay a percentage of their store’s sales. Leases — which have been scooped up by international, out-of-state and e-commerce brands — are at least six months long. Under the agreements, Sharefront covers facility and operational expenses including staffing.
Following the e-commerce boom during the pandemic, physical retail has returned with a vengeance. For many consumers still appreciating the freedom of going out, shopping offers a fun activity or an opportunity to socialize. At the same time, brands experiencing new challenges with digital advertising are newly opening stores as branding and awareness plays.
But earning in-store shoppers amid the growing habit of scrolling and adding-to-cart increasingly requires an experience beyond a transaction. For emerging brands, that’s often hard to pull off. Multi-brand concept stores have attempted to open up the opportunity, but they too have faced challenges. A new wave of retail companies is now attempting to prove that the winning formula is a shared space that provides multiple services and is laser-focused on one consumer category.
“Many [retail] companies have said they’re creating more of an experience, but when you go to those stores, it’s just an Instagrammable moment,” said Cohen. “For the younger generation, shopping has become more about self-expression than about products; they want to feel like they’re part of something greater than just a store.” He called Ralph’s Coffee, Kith and Aimé Leon Dore inspirations, as their customer goes out of their way to get a coffee or treat from their stores based on the community they’ve built.
Another point of reference for Cohen is Todd Snyder’s store in NYC’s Madison Square Park. Along with a Joe Coffee Company café, it features a barbershop, a third-party tailor and a gym on the lower level. “[Snyder] was the curator of the whole thing,” Cohen said. “And each of the [included] businesses generates regular foot traffic.”
According to Richard Marshall, gm of Blvck Paris, shoppers at The Den are largely male New Yorkers ranging in age from 18-40. They work in finance by day but prefer to dress “cooler” in the evening, in minimalistic, high-quality pieces. “I’ve been told that there are people in New York’s Soho House wearing our stuff right now,” he said.
Blvck Paris’s space at The Den served as a “fairly risk-free” kickoff to its ambitious plans for U.S. expansion, based on the fact that U.S.-based e-commerce shoppers make up 50% of the brand’s customer base, Marshall said. Two months after The Den opened, Blvck Paris opened a solo store through retail-as-a-service-platform Leap at Westfield Valley Fair mall in San Jose. Its long-term goal is to leverage funding to open stores “in every shopping mall in the U.S.,” said Marshall. The 7-year-old company is currently owned by its co-founder and designer Julian O’Hayon. It teamed with retail partners to open 10 stores in Asia in 2021.
“Europeans don’t buy like Americans and Asians,” Marshall said. “In the U.S., [it pays to] have stores in malls or on high streets. [Shopping] is what Americans like doing on their evenings and weekends.”
Through The Den, Blvck Paris has so far experienced triple-digit monthly sales growth. The Blvck Paris team worked with Cohen for 12-15 months before the store opened to ensure brand alignment with the choice location and co-tenants, provide direction on merchandising, and “ensure the customer experience was not diluted,” Marshall said. He added that he has been in touch with the other tenants and takes part in regular Zooms with the store staff, which Blvck Paris had the option of hiring. “We feel like we’re part of the team, which is what we wanted,” he said.
Cohen, who has bootstrapped The Den and signed a 10-year lease, also reported increasing sales and awareness, overall. He said the store’s regularly hosted events, like comedy shows, art gallery nights and brand pop-ups, have helped. Tenants’ social accounts have worked well to drive store traffic, as has The Den’s prime Mercer Street location. And Sharefront recently hired a social media manager to provide additional support.
Tourists’ dwell time in-store has typically ranged from 30 minutes to an hour, while locals stay for up to five hours while using the lower level or coffee shop as a workspace, Cohen said. Moving forward, he plans to launch a loyalty program for businesses interested in using The Den as a co-working space or renting its lounge for events, while also enjoying discounts throughout the store. In addition, he’s building software that will match brands with compatible, non-competing businesses, to support concept store planning and brand partnerships.
The Den is just the first iteration of Cohen’s vision for community-fueling storefronts. Next, he hopes to open a wellness hub, of sorts, in the second half of this year in NYC’s West Village. He’s envisioning a speakeasy pilates studio, complete with a café, nutritionist, gym equipment retailer and facial spa. Because The Den offers both men’s and women’s options, he then wants to open stores exclusively for men and women in NYC. Then, based on their successes, he wants to replicate the experiences, with the same brands, in cities across the U.S. He’s eying prime locations in Los Angeles, Miami, Chicago and Texas, with a goal to expand beyond NYC in 3-5 years.
Following a similar concept is Vancouver-based Turf, which offers fitness classes, restaurants and shopping and caters to the wellness set. Lululemon alums Deanne and Delaney Schweitzer opened the space in 2017. In summer, active swimwear brand Left On Friday hosts a 200-square-foot pop-up shop at Turf that generates $200,000 in less than four months, according to the founders. “Our target customer is walking in and out of that space every day,” Delaney Schweitzer told Glossy in December.