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Express: Why Social Selling’s the Next Frontier

Express Inc. has very big plans on how to grow its business.

“We are committing to generate over $100 million in operating profit on $2.1 billion of sales by 2024,” Tim Baxter, Express’ CEO, told Wall Street analysts at the company’s Virtual Investor Day on Thursday.

The Investor Day presentation followed Wednesday’s second quarter earnings report in which Express posted profits of $10.7 million on revenue of $457.6 million. In addition to retooling its merchandise focus, it also paid special attention to its denim offerings, which didn’t hold a core category position before the pandemic.

“We know that denim is the foundation of every modern wardrobe and that we had a tremendous opportunity, so we completely reinvented our offering,” Baxter said. He noted that the company posted a 21 percent comp increase in denim in the second quarter. The merchandising and design team also introduced Express Essentials, featuring a body contour styling that’s been a “game changer for us in women’s,” he added.

“We are in the midst of a transformation from being known as a store in the mall to a brand with a purpose,” Baxter said, reiterating the retailer’s goal to achieve $1.0 billion in e-commerce sales by 2024.

Baxter said the company is on track to reach that goal, but how it plans to get there involves a new add-on business model to its e-commerce operation that’s powered by a styling community.

I can’t think of a better time to do this right now. Community commerce is the next significant step in our journey. It also happens to be exactly right for these times, and in our customers lives,” he said.

The direct selling framework of surrounding Express’ community commerce business, also referred to as social selling, is a new one for the industry. While Tupperware parties and the tagline “Avon Calling” come to mind, the modern-day version is conducted virtually. And stylists are in effect influential celebrities within their own social networking group. One fashion firm that uses the idea of social selling is Cabi, formerly known as Carol Anderson by Invitation. Cabi has over 3,300 entrepreneurial consultants—who average $30,000 in annual income—with home-based businesses across the U.K., U.S. and Canada. Customers can make online purchases, but only through their stylist’s personal Cabi web site.

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Social selling is a customer acquisition tool for Express, while stylists get mentoring to help them grow their virtual storefronts.
A look at an individual’s virtual storefront that will fuel Express Inc.’s new social selling program. Courtesy Photo

Stylists in the Express program get exclusive access to special Express Edit items, and they receive daily coaching and mentorship on how to build their virtual storefront with their community members.

“My entire job is to make them successful so together we can meet our Express business objectives,” Lindsay Bartow, director, community commerce, said.

The new model has benefits for both stylists and Express. “What’s in it for them? The ability to make their own hours, make extra money and make people feel great. Maybe they want to be full-time influencers, or maybe they’re just looking for a creative outlet and a way to turn something they love into a successful side hustle. And what’s in it for us? An incredible customer acquisition opportunity by tapping into the networks of our stylists,” Bartow said.

Brian Seewald, senior vice president, e-commerce, said that the company thinks of community commerce as “an accelerant and a supplement” to an already growing e-commerce business.

“As we recruit and select our style editor community, we get access to all of the people that are following them, and that brings new customers into our fold and just helps to accelerate our overall growth,” he said, adding that the company also plans to host store events to help these experts bring in an element of experiential retail.

While Baxter has long cited the benefit of brick-and-mortar as an important element of any retail strategy, the experience Express has created in some of its stores has largely been focused on its fitting-room strategy.

“Our customers told us that’s what they really want us to improve. So we’ve got larger fitting rooms, with better lighting. We’ve got call buttons to call associates when you need help. They’ve told us they want a place to sit, so we’ve added places to sit,” Baxter said. Customers also said they wanted plugs to recharge their devices, and an area where friends can sit while Express customers are in the fitting rooms.