For years, commentators have been warning of the imminent death of brick and mortar retail. "Amazon is squeezing out the mom and pop shop! It's suffocating Barnes & Noble! Malls don't stand a chance!" How could any store or brand possibly compete with the infinite accessibility and selection of the internet? Well as it turns out, they can, and quite well. In fact, even the great brick and mortar killer Amazon is investing more and more in physical stores.
YPO member Rachel Mielke has proved the brick and mortar naysayers wrong at every step. Mielke is the founder and CEO of Hillberg & Berk, which designs and manufactures high fashion jewelry at attainable prices. Mielke's jewelry has graced the Oscar red carpet and been seen on royalty like Queen Elizabeth II and Celine Dion. While they started selling to wholesalers to get distribution throughout Canada, the real turning point for the company came when Mielke decided to build a physical location. Hillberg & Berk has made PROFIT Magazine's 500 List of Canada's Fastest-Growing Companies, and Mielke was named to their W100 ranking of the Canada's Top Female Entrepreneurs. She's also been named to Canada's Top 40 Under 40 List, included on the Women's Executive Network's Top 100 Most Powerful Women in Canada, and named an EY Entrepreneurial Winning Woman, just to name a few of the accolades she's earned.
On an episode of my podcast 10 Minute Tips from the Top, Miekle shared how she's used brick and mortar stores to fuel the growth of her company:
1. Find a niche.
Mielke has a business degree with a concentration in marketing, so she understands how to attract customers. For her, it started very personally. She explains, "I wanted to create luxury jewelry that was affordable. Being a young women who had just [graduated] from university, I couldn't afford to go and buy a piece of jewelry that was $1,000. But I might have had $100!" Even in a small city of 200,000 like Regina, Hillberg & Berk thrived. Mielke recalls, "Very quickly after I started selling it, I realized that people were connecting with my designs." She goes on, "I think that we had done something really unique and different. And I think that when you carve out a niche that's special, people will support you, regardless of how large or small of a center that you live in." Mielke shares. It's ok if your product isn't for everyone. The customers it is for will love it passionately.
2. Identify your inflexion point.
When she started Hillberg & Berk, Mielke didn't have a plan to open a series of retail locations. It was a successful strategy: "Initially, wholesale was easier. It was an easy way to break into the industry first...and I had my jewelry in boutiques all across Canada," she says. Using the internet and selling through other retailers is a safer road for many entrepreneurs, since you limit the risks associated with elements like facilities and consumer-facing employees. Eventually, however, Mielke found the limits of wholesale. Mielke explains, "You get to a point where you can't scale quickly anymore. You get to a certain level and it's really hard to explode your business beyond that point. And I think it was at that point that I realized that I envision Hillberg & Berk as a global brand, so I needed to figure out the best path to make that a reality."
3. Tell a story.
Despite the risks and the brick and mortar naysayers, Mielke saw the potential of opening a retail store. She says, "I decided that I wanted to open up a store as well. I wanted to be able to really tell our brand story through our own retail location." For Mielke, it was a personal story she wanted to tell: "I've always gravitated towards beautiful gemstones, pieces that are bold but still feel classic, something that you can feel as fabulous in today as you will in 10 or 20 years." Her instincts were right on. "And that was the whole turning point for Hillberg & Berk, because when I opened that first store, very quickly it became very successful," she shares. Storytelling through a retail location is a different kind of communication than many modern retailers have the opportunity to use.
4. Scale up!
Hillberg & Berk offers more than just fine jewelry. "Sparkle and jewelry is the tool that we use, but really our bigger purpose as a company is to create social change to help women find their inner sparkle, to go out and take on wherever they are in their lives," Mielke enthuses. With that vision in mind, Hillberg & Berk still has growing to do. "That first store really opened up our eyes to retail, and solidified our company's ability to tell our own story properly and share the specialness of our brand. That gave us the confidence to open up a second location, and our third," Mielke says. She goes on, "If you differentiate yourself and there's something special about your product and about the way you tell your story, I think that's why our stores have been very successful." Meilke sees more retail locations in the future, and she's using Verne Harnish's Scaling Up to guide the process.
On Fridays, Kevin explores industry trends, professional development, best practices, and other leadership topics with CEOs from around the world.