Since launching the company in 2011 as a direct-to-consumer clothing brand committed to “radical transparency,” Preysman and his team have been strategically expanding its scope. Defying the reign of fast-fashion heavyweights like Zara and H&M, Everlane has used its website and social media handles to offer customers a glimpse into its factories around the world, give voice to the workers making its garments, and share a price breakdown of each product it sells. Shoppers can see that Everlane’s original $15 American-made tee costs $6.50 to produce—and that the company’s markup is significantly less than the $45 that traditional designer brands tack on.
Everlane’s forthright messaging, coupled with its spare, fashion-forward aesthetic, has turned customers into emissaries—and inspired a slew of upstart fashion brands, such as shoemaker M.Gemi and technical clothier Aday. “Everlane provided a model for how to communicate that our quality is what we say it is,” says Scott Gabrielson, founder of accessories startup Oliver Cabell. Preysman is also pioneering new approaches to retailing, making use of steady product launches, waiting lists, and limited inventory to both predict and drive demand. “Everlane created a sense of urgency and exclusivity [around its products],” says Marshal Cohen, an analyst with market research firm NPD.
Everlane uses its waiting lists, along with real-time data and customer feedback, to make inventory decisions. When in doubt, it stocks less. And when items sell out—which happens a lot—Everlane can restock quickly, thanks to its close relationships with its more than two dozen factories worldwide. All of this generates the specter of scarcity, which Preysman leverages: Customers sign up for early access to new clothes and to be notified when popular ones are back. Last year, when Everlane’s new ballet-inspired heels sold out within three days, 28,000 people added their names to the waiting list. This steady communication with customers is so important to Preysman that, until a few weeks ago, he was involved in drafting every single email.
To avoid the appearance of discounting, Preysman developed a Choose What You Pay model for overstocked items, where customers can pick up, say, a dress shirt for one of three different prices. The website explains that the lowest one lets Everlane recoup its costs, while paying more allows it to invest in future product development. Twelve percent of shoppers opt to pay more.
Why it’s hot?
(1) Transparency, transparency, transparency!
Everlane is the definition of championing transparency – and it pays off! They clearly articulate their brand values of ethics, price and design that differentiate them from other competitors. They market their brand values first, products second.
(2) Agile inventory management
Everlane is also smart about how to leverage inventory data. They strategically stock less and use wait lists, early access data and customer feedback to determine if/when they should stock more resulting in a strong pricing model and reduction of wasted inventory.