During the DTC wave in the 2010s, the cashmere brand Naadam was one of the premier names. But according to co-founder and CEO Matt Scanlan, Naadam has always been an omnichannel brand.
“When you’re in a category business, you have to think about all the channels that are open to you,” Scanlan said. Over the years, Naadam has done private label and wholesale and sold its product through platforms like QVC. Now, the brand is doing its first diffusion line: a collection at Kohl’s, with pieces selling for as low as $79.
The partnership with Kohl’s, which doesn’t have an end date, came out of Naadam parent company Naadam Collective’s 2019 acquisition of sustainable apparel brand Ivory Ella, which has been sold in Kohl’s since before the acquisition. Naadam’s collection sold at Kohl’s is not a private label nor an existing product from Naadam’s catalog. Instead, Scanlan described the collection as a co-branded sub-label, using the same materials as Naadam’s mainline cashmere, only in lighter weights to bring the price down. Naadam’s main line of sweaters sells for around $98 and up. Naadam currently brings in over $100 million annually.
For Scanlan, partnerships like these aren’t necessarily meant to be huge sales drivers. Direct e-commerce sales are still 80% of Naadam’s revenue, he said.
“We view retail as a way to reach customers and build brand in new regions,” he said. Kohl’s currently has over 1,100 stores across the country.
Scanlan defined his larger strategy as a numbers game. “It’s all about getting as many chances at bat as possible,” he said. “You’re not going to hit a grand slam every time, but the more chances you get, the more likely it becomes.”
He used the QVC business as an example. Launched in 2018, the business ran for around four years before Naadam quietly shut it down. For Naadam, the margins weren’t good enough to justify the expense, and for Scanlan himself, the weekly commitment to appearing on the channel was too much.
Other tests are happening regionally and focus on Naadam’s categories outside of its core cashmere knitwear. Pop-ups in Boston are showcasing its outerwear collection, for example, and in Texas, Naadam is testing fine-gauge sweaters.
This test-and-learn approach also applies to Naadam Collective’s other brands. Over the last 10 years, Scanlan acquired or was involved with launching a number of other apparel brands, like the designer label Thakoon, the Arielle Charnas-co-founded Something Navy, the sustainable apparel brand United by Blue and the CPG brand Package Free. Many of those brands are no longer affiliated with Naadam Collective or no longer exist. Something Navy was sold last year after numerous financial problems. Thakoon is still owned by Naadam Collective, but it’s on pause.
Naadam Collective, which once was made up of six brands with hundreds of millions in revenue, is now down to just three brands: Naadam, Ivory Ella and Package Free. Scanlan said that, in the late 2010s and even the beginning of the 2020s, the market was friendlier toward costly acquisitions.
“In a bull market, acquiring revenue works,” Scanlan said. “In a bear market, it doesn’t.”
