Apparel Programs as a Brand Extension

Emily Lane 00:02

You know, are there some other key strengths behind going down this path of morecustomization and building your own product,

Bret Schnitker 00:10

the big key strength is they all become walking, breathing billboards, everywhere,advertising for your company. And so I think that's a huge benefit, you know,that comes with things to be careful of is that, you know, statistics say over70% of people feel that the quality of the garment is an extension to thequality of the brand.

Emily Lane 00:44

Welcome to Clothing Coulture, a fashion industry podcast at the intersection oftechnology and innovation. I'm Emily Lane

Bret Schnitker 00:52

And I'm Bret Schnitker. We speak with experts and disruptors who are moving theindustry forward, and discuss solutions to real industry challenges.

Emily Lane 01:00

Clothing Coulture is produced by Stars Design Group, a global design and productionhouse with more than 30 years of experience.

Emily Lane 01:06

Welcome back to another episode of Clothing Coulture. Today, we are at the worldheadquarters of Stars Design Group, and I am joined once again by BretSchnitker, CEO of Stars Design Group, we're gonna be talking today about usingapparel as a brand extension, this can be a really wonderful opportunity forcompanies to build brand loyalty, add marketing opportunities, even revenue totheir bottom line, we've seen some great successes in there with companies thathave started in their production of another product, totally different apparel.And then we've seen them really broaden the scope of their customer base andloyalty by bringing apparel in. We also saw during the pandemic, apparel, savecompanies, restaurants, added things like T shirts, hats and hoodies to theirprograms to keep revenue going and kind of foster additional club loyaltyamongst their local following. There are a lot of ways to go about this from aproduct standpoint, and from a you know, assortment standpoint, Bret, how doyou know, first of all, when the time is right to be looking at apparel as anextension for your brand?

Bret Schnitker 02:25

Well, I think you know, when you analyze a business, and we've talked about this inother episodes that, you know, when people wear apparel, for the most part thathave logos, printed media, things like that on the front, and it's got someidentifiable association with a brand, then, you know, you've got to know thatyou're big enough to have a loyal following somebody that believes in and likesyour brand. And I think that's certainly the very first step in determiningwhether you should walk down that route.

Emily Lane 02:58

So people are having kind of this emotional connection to the brand, there's athey believe in what the company stands for, and want to proudly be a part ofthat club.

Bret Schnitker 03:09

That's certainly the starting point. There's some really surprising, you know, brandsthat have a started in one category that loyalists really get and have moveddramatically to an apparel brand that is disassociated from the original brand.Fox Racing is one of those. So in the outdoor sports area, Fox was originally ashock absorber company. And so loyalists in that industry really understand Foxas a shock absorber company. But if you take a look at the industry as a wholethat walk in and buy Fox products all the time, and you told them hey, youknow, the origination of of this brand, particularly they'd be shocked. Theyassoicated it with Outdoor, you know, performance brand. Yeah, it's sort ofunrelated, you  know.

Emily Lane 03:56

Yeah, I think of you know, companies like Harley Davidson, for example, you know, it'salmost as popular as their motorcycles the, the, you know, desire for theirleather jackets and things of that nature, you know.

Bret Schnitker 04:08

Over the years companies like them have evolved to a more sophisticated level, you know,moving kind of past a promotional advertising kind of decision when you'reinitially launching product, to developing that as part of the overall brand.

Emily Lane 04:34

You know, let's talk about that. The difference kind of between that ASI market whereyou're getting a already produced item, a polo hat shirt, and you're puttingyour own logo on it, versus going into a slightly larger scale production whereyou're customizing it. What are some of the first of all, what are some of thekey differences of one approach versus the other and what are we looking atfrom an investment standpoint is that a significant difference.

Bret Schnitker 05:02

I think some of it's the timing of the evolution of you moving into apparel. So bytaking existing blank products and putting decoration on it, I mean, it's ahuge industry in the US. And you can buy smaller quantities, you can react todemand very quickly. And you can test different types of products that that arein stock when you when you move to actually creating brands and customizedproducts and things like that. And you would think going offshore, it would bea wise decision based upon the costing elements of those things today, thenyou've got different commitment levels, you have larger quantities that you gotto invest. So it would require, I think, somewhat of a maturation of a brand orsome initial testing of the waters in smaller quantities, you know, that youcan get domestically, the costing, sometimes can be much less expensive, whenyou go offshore, quality can be even more improved, you have more at least youhave more of a a handle on your own destination and quality when you gooffshore. I think picking specific products, specific qualities fits that fityour demographic, etc, which doesn't as much exist and, you know, ready to makegarments that are sitting on shelves. So, you know, there's those thoseparticular things as you move offshore, provide a lot more benefit is as yougrow this extension,

Emily Lane 06:32

How do you make decisions about what should be in that initial assortment?

Bret Schnitker 06:35

Sometimes you just look to the industry in general T shirts, we've been in this space, wehave a vertical in the promotional products industry. And we've been in thatvertical for quite some time. And the industry started doing kind of T shirtsand hoodies and caps, very basic kind of elements that that a lot of peoplewear every day. And today, it's still a very, very large percentage of thosemixes. So as you're taking those steps into bringing in apparel, to as anextension to your brand, those three categories make the most sense to start.And then understanding your demographic understanding your unique approach ofwhat your brand represents in your space. You could add other decision makingitems, outerwear pieces, you know, shirts, etc. to help support that.

Emily Lane 07:29

What do you think are some key benefits? I mean, obviously, we we've mentioned buildingbrand loyalty, but you know, are there some other key strengths behind goingdown this path of, you know, more customization and building your own product.

Bret Schnitker 07:44

The big key strength is they all become walking, breathing billboards, everywhere,advertising for your company. And so I think that's a huge benefit, you know,that comes with, things to be careful of is that, you know, statistics say over70% of people feel that the quality of the garment is an extension to thequality of the brand, right? So if you're if you're thinking, hey, I want thatwalking, breathing Billboard, and you you might skimp on quality to get the bestprice on a t shirt. And that quality becomes challenging for the consumerthat's wearing it or visually doesn't look dynamite when other people see thoseperson or the other people wearing it, that can have an impact on on how peopleview your brands. But, you know, the benefit of having people all over wearingyou know, your name, across their chest, across the back, wherever it may beacross the forehead is a is a pretty strong deal today.

Emily Lane 08:45

Yeah, it's actually pretty good ROI. If you look at the cost of customer acquisition,now in an online world, it's certainly much more expensive than a cost of a Tshirt.  

Bret Schnitker 08:58

You're kind of looking at the cost per impression. Yeah, well online versus havingsomeone wear them that passive impression of having somebody especially in bigcities walking up and down the streets. You're, it's it's a fraction of apenny.

Emily Lane 09:13

So apparel could actually be a part of your marketing budget.

Bret Schnitker 09:17

Certainly.

Emily Lane 09:18

Okay.

Emily Lane 09:24

You know, an industry that I think of a lot that's in this space of providingapparel items is you know, the concert circuit, you know, going to a SmashingPumpkins concert or Pearl Jam or you know, any number of them. Everybody'sstanding in line for the shirt. And that is one of those examples where younever know what you're gonna get with regards to size. There's inconsistencyfrom one concert to another from, you know, one showed, you know, one show toanother. And I would think that that's a space that has enough people comingthrough where or, again, quality is could be really elevated and consistencyand fit. And all of those things that we take seriously in development ofapparel could really improve the whole experience.

Bret Schnitker 10:11

That's a problem the industry has, in general, the inconsistency of sizing, we've kindof talked about that, in general. And each each segment of these companies andareas like you mentioned, the music business, or all these other verticals thatyou know, exist in the business space out there, though, they all make theirown decisions on on ROI and things like that. And, you know, you you got to aconcert, you enjoy yourself, you want to, you want a memory from that concert.So the t shirt biz is a huge revenue maker in that space. But they've they'venever really concentrated on elevating quality in that space and looked at specin a lot of ways because the demand is still there. I think there is someevolution, where certain musicians and groups like that are looking to extendtheir product mix, because again, you know, statistics say they associate thequality of the garment with the quality of the, you know, the purveyor or themusician or company or whatever. So that's you really need to consider.

Emily Lane 11:14

Absolutely, you really need to make sureyou're in alignment on that, you know, if you're a high quality vehicle, ifyou're a really delicious beer, if you are, you know, whatever the product is,you want to make sure that your product speaks to the same level of your ofyour brands. Yeah, I would imagine some other things to consider, you know, alot of these companies are in a different space. So thinking about distributionmethods, or you do have a setup in which you can sell the goods would besomething to be mindful of.

Bret Schnitker 11:49

Oh, I think most certainly, again, there's a pretty robust organization, feworganizations out there in this particular industry, ASI and PPIA that have alarge network of distributors that kind of step in and help businesses managethat larger businesses are starting that have their own warehouse facilitiesand have their own bandwidth in terms of managing promotional products andapparel in that space, you know, kind of take that in house as an evolutionsometimes, but you know, that promotional products industry is is prettymature. And in that, that effort to help businesses build them.

Emily Lane 12:28

You know, in this scenario that we're talking about, we're talking about existingcompanies that have an audience that are established. So often, when we speakto new brands, we talk about the time and investment to get off the ground andreally start seeing a return on your investment and things of that nature. Youknow, when you're looking at a business like this, where like we're talkingabout where they're already established, and they're looking to bring apparelin, is it going to be the same kind of, you know, three year to three yearcycle before they start seeing a return?

Bret Schnitker 13:03

It's interesting, because a lot of the decision making in this space is not basedupon unnecessary ROI on the actual product, they're really looking that this isan extension to the marketing and advertising budget. So if they're breaking,even if they're just sending it out, remember, it's like spending money on abillboard, they're really looking at the statistics, statistics of ROI, more inline with marketing advertising than they are as an extension of a brand. We'vecertainly seen evolution, you mentioned a large motorcycle company before inthis talk that has evolved into a pure brand. And all of that becomes profitinternally, in addition to marketing and advertising.

Emily Lane 13:43

Right. Yeah, it is amazing to think about the other side of it, you know, havingintention behind building apparel that becomes its own has its own life behindit versus you know, there are a lot of companies out there that do a fairamount of sales outreach. And, you know, we'll give away 7000 hats. You know,that right? There is an opportunity to make sure, again, that product alignswith the message you're trying to communicate. Absolutely, yeah. Well, thoseare all really wonderful things to think about Bret and knowing that, you know,in the last 20, some years, this has been a strong vertical of Stars. Do youhave any other points of wisdom to share that might help some businessesconsider whether or not the time is right for them? Or just key considerationsto make while they're going down this path?

Bret Schnitker 14:28

Yeah, I think at the point that they're looking at moving from kind of this instockdecorated domestic situation to an A more evolved decision in terms of apparel,you know, thinking about planning, because one of the big shifts of mindset inthis industry is, look, I can get the instock goods and decorate them and getthem in a couple of weeks to move to a more apparel model that's being producedoverseas that takes a much longer time. So there are definite benefits forgoing that path. You're going to have a much Much more elevated product. Inmany cases, you're going to have something that more aligns in terms of actualcolor matching to your brand, etc. But that does take planning in advanceunderstanding how you're going to go down that path if it's for a specificevent or something, backing that out allowing the time with everything that'sgoing on in the world today, freight being what it is, etc. buying productsfrom overseas takes a much longer time than buying it off the shelf. Soplanning is is critical, I think for sure.

Emily Lane 15:32

That's great advice. Thank you for joining me in this conversation once again, Bretand don't forget to subscribe to stay apprised of upcoming episodes of ClothingCoulture

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