Issue No. 273: Modern Luxe Doesn’t Bend

Pictured: Outdoor Voices, from our Open Letter to DNVB CEOs

In November of 2016, Lean Luxe’s Paul Munford penned somewhat of a scripture to upstart modern luxury brands: promotion-heavy retailers will not last. There are few takeaways from “The Downward Spiral” that are worth mentioning as recent economic reports suggest that the retail apocalypse is coming to an end, a great sign for aspirational DNVBs that are looking to expand into physical retail.

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We are in a time of unprecedented retail brand launches, collaborations, acquisitions, and re-imaginations – much of which is online-first. This begs the question, what will separate the winners from the commodities? There are early and permanent decisions that determine a brand’s trajectory. For every Mizzen + Main or Ministry of Supply, there is a State and Liberty. For every Outdoor Voices, there is a Bandier. And for every Away, there is a Raden. Each decision matters. And no decision matters more than pricing and a brand’s promotional tendencies.

Here are the top ten takeaways from some of Munford’s best work:

  • No maneuver in retail appears to be as easy to roll out, yet no strategy is as detrimental to a retailer’s long term prospects as the heavy discount. It is a palliative pill: wonderful for the consumer in the short run, but ultimately bad for both business and shoppers over time. It commoditizes the brand, forcing companies to differentiate on price. 
  • The second problem, also related to scale, is systemic to the industry itself: The need to constantly add more and more products at regular intervals, flooding the marketplace with goods that are newer, but rarely better.
  • The lure of the discount, then, becomes too hard to resist. It provides a short term boost to the bottom line and the illusion of growth, but at the expense of brand reputation and sustainable profit — two vital arteries for a business’s overall health.
  • Modern luxury companies have figured out the formula, and it’s remarkably simple: create less merchandise than will sell (and predict, if possible, the sell-through rate, with pre-orders), keep demand high. Embrace the waiting list, as Everlane, Glossier, Caraa, and Alala, among others, often do. 
  • Never discount; preserve the standing of the brand. These tactics certainly do not work, however, or at least for very long, if product standards are below par.
  • Hermes, for instance, is notorious for never slashing prices. Its products carry a prestige because of that, and there is always a demand, no matter how frivolous the item. And they certainly are not above testing the limits of consumer devotion: It has even gone so far as to repackage its cutting floor leather scraps to sell them as high-priced gift boxes.
  • That opposition to discounting would come from founders within the emerging modern luxury industry is no coincidence. For one, it displays the trademark sense of calm confidence in the product that this group is quickly becoming known for. 
  • As for Mr. Preysman, the full price mantra feeds into his mission to constantly refine the product, to make it better, and push it ever closer to perfection according to the standards of the brand.
  • Surprisingly, rejecting the discount is also quite consumer-centric. The eternally-wise Ben Franklin said it best, of course, when he offered this observation: “The bitterness of poor quality remains long after the sweetness of low price is forgotten.”
  • It takes superb maturity and a great deal of resilience to fight the urge for the temporary discount boost at the expense of preserving a long term reputation. 

Maturity, patience, grit, and perhaps temporary poverty are keys to developing the types of brands that grow to compete with age old legends and fierce (but hopefully friendly) rivals. In 2013, Brooks Brothers commented on Mizzen + Main’s influence on the shirting industry for the New York Times:

While Brooks Brothers experimented with “performance” shirts akin to Mizzen & Main’s, [Brooks Brothers’ spokesman] Mr. Blee said that customers preferred the general wearability of conventional all-cotton. The stretch fibers felt synthetic to them. Although a range of Brooks Brothers oxford shirts have moisture-wicking properties, he said, “We are known as a natural-fiber house: 100 percent cotton, 100 percent cashmere.

Just five years later, Brooks Brothers is launching a competitor to compete in a menswear world that is being re-defined by technical fabrics and other innovations.

Mizzen+Main on Twitter

we’re old enough to remember when Brooks Brothers laughed at performance menswear:

I remember the joy of that article hitting the newsstands on December 18, 2013. Not because of the notoriety that it would provide but because it had been over a year and half and we really needed the sales. We stood firm on our price while we built allegiances and Kevin worked feverishly to improve the product. And the company lasted. What Lavelle and team has done today is nothing short of spectacular. And it has allowed the brand to stand, eye to eye, in the same clubs and on the same courses as the company that invented the polo shirt (sorry, Ralph).

To achieve growth and longevity, branding cannot be viewed as a soft skill. Price cannot be viewed as an arbitrary number to manipulate. The five forces must always be considered. And patience must be paramount because great brands start slowly. In the age of modern luxury DNVB’s this is as important as the products themselves.

Read more: An Open Letter to DNVB CEOs (Issue No. 254)

Read the rest of Issue No. 273 here.

By Web Smith and Meghan Terwilliger | About 2PM

Issue No. 265: Can A DNVB Achieve Modern Luxury?


Om Malik and Lean Luxe‘s Paul Munford had a thought-provoking exchange. Does the modern luxury go-to Lean Luxe (and the industry as a whole) have a grasp on what luxury means in online retail? On its face, a physical product that makes itself available to the masses cannot be a luxury product.

Lean Luxe on Twitter

@om Sure, by the old definition of luxury – you’re correct. But don’t judge modern luxury brands’ bonafides using the old set of luxury rulebooks. More here: and here:

There are very few products, if any, that digitally vertical native brands (DNVB) sell that would qualify as traditional luxury goods. Here is Munford’s definition:

The key strength of a modern luxury brand is its emphasis on the entire package, rather just the product (or logo) itself. It’s a different mode of operation that takes some getting used to, but it disperses with the conventions of the old, blingy version of luxury, and is best optimized for today’s new consumer behaviors and expectations.

The fact of the matter is that competing on product quality alone leaves a brand open to exposure. MLCs have smartly understood that a better overall package or bundle — in an open market like today’s — can be far more compelling to shoppers than just product alone can.

Lean Luxe

Munford makes an important point that I’d like to take a bit further. Lean Luxe tends to maintain a narrow focus on hard goods and the packaging that they arrive in. But what about the purchase process and the attentiveness to customer happiness? And what about time?

The definition of luxury: an inessential, desirable item that is expensive or difficult to obtain.

2PM’s Meghan Terwilliger had this to say:

Luxury, however you define it, is a brand’s embodiment of characteristics that make it desirable. Historically, those characteristics have been more ‘What’ features like quality, exclusivity, and cost. You can still define luxury as characteristics that make a brand desirable, but those characteristics have shifted. Quality is table stakes.

The characteristics that make brands more desirable are ‘how’ features like excellent customer experience (how do I experience the brand), meaningful brand mission (how do they give back/make a difference), and community engagement. Is it artist-created and excessively expensive? Maybe not. But if it is a product, or even an entire experience that is highly desirable, it can be considered a luxurious brand. DNVBs just so happen to possess a great infrastructure to support the characteristics that define modern luxury.

Luxury is always relative; it is loosely defined to meet the times and the market. If you walk through a great mall in the United States, you will visit brand experiences that will provide a luxurious taste. Take Ohio’s Easton Town Center as an example. The indoor / outdoor mall features Burberry, Tiffany and Co.,  and Louis Vuitton. However, your perception of luxury changes when you walk through the Bal Harbour Shops in North Miami Beach.  Bal Harbour is considered the finest mall in America. Both malls are considered “luxury” malls but neither are as luxurious as Dubai’s mall.

But can a DNVB be a luxury brand?

The notion of luxury is often applied to tech fashion brands. I partially agree with Om Malik’s statement here.

[Lean Luxe] is again confusing smoke / mirrors marketing and what is really luxury. All I know is that AllBirds and Brandless and Casper are not luxury, And no amount of your linguistic gymnastics will convince me of what is luxury, FWIW, LV is not luxury either. Too common.

AllBirds, Brandless, and Casper do not make luxury products but Munford isn’t suggesting that their products-alone are what classifies them within the modern luxury space.

Louis Vuitton was first hired as a personal box maker and packaging expert for the Empress of France. He was charged with “packing the most beautiful clothes in an exquisite way.” It was the practice that helped him to gain influence among the elite and royals, catapulting Louis Vuitton’s namesake to luxury status.

Louis Vuitton began with an early product and the two advantages commonly seen in the DNVB space:

  • Packaging
  • Maniacal focus on customers

The definition of a DNVB: a brand born online with a “maniacal” focus on the customer experience. A DNVB may start online but it often extends to a brick-and-mortar manifestation. Digitally native vertical brands control their own distribution.

Luxury brands don’t always begin as purveyors of luxury products. And due to a macroeconomic consumer shift from materialism to investing in luxury experiences, there are a large number of consumers who prefer DNVB’s luxury-experience over traditional luxury products. For many in the business and wealth classes, it’s a symbol that their money is better spent on even finer things than goods. The definition of luxury is changing.

Here are two relevant passages from 1994’s The Idea of Luxury:

Page 18


Page 35

Page 34

Buying experiences over buying consumer goods is a trend being adopted by the luxury-set. The interpretation of the word luxury means something altogether different for the types of customers who have the means and awareness to shop with DNVB brands. Skift’s latest research shows a clear shift in demand for more transformative travel experiences among upscale travelers (Skift / May 2, 2017). Whereas expensive products used to be the consumer desire: products, community, and service now play the role of enabling experience economy.


Many DNVB products (see the database here) are marketed to enable this type of consumer: Mizzen+Main (No. 86) is for the traveling business class male. Ministry (No. 91) is for the well-educated, urban millennial. AllBirds (No. 56) is worn by the business casual, aspiring member of the investor-class. Rogue (No. 8) turned a garage into a coveted space in a home.

Digitally vertical native brands are founded with these basic questions:

(1) How do we make a great product?

(2) How do we build a community around it?

(3) How do we provide an elegant solution for commerce?

(4) How do we enable customers to save time and focus on what matters?

“One fundamental trap that people run into when assessing the merits of a modern luxury brand is the tendency to judge that brand using the ‘best-in-class’ framework,” says Lean Luxe’s Paul Munford. Lean Luxe’s definition is mostly right. Munford discusses packaging as part of the bundle: “[These brands] offer a better bundle to offset [traditional definitions of luxury] — more convenience, transparency, connection, better messaging, pricing, etc.”

But a selection of modern luxury brands are also marketing time as part of the proverbial “bundle” and that’s the only place where Munford and my thoughts differ.

It’s no longer sufficient to define luxury products by how difficult they are to attain. Time is the scarcest resource and the ultimate luxury. Being a modern luxury brand is about being self-aware. These brands sell time as a scarcity and then build products around it.

There may be no greater example of the community / product / service paradigm than Peloton, a DNVB that Malik’s True Ventures joined back in 2015.

Peloton is now shifting gears with a new financing program ($97 per month for 39 months for both the bike and subscription service), an ad campaign that’s more relatable to a diverse consumer base and an NBC Olympics sponsorship. Peloton counts NBCUniversal among its investors, and has raised nearly $450 million in total funding to date.

“We had this idea of a very affluent rider who many of our early adopters were,” she said. “We realized, through conversations with our community, that there was a huge opportunity with people who thought $2,000 was a huge investment but were [buying] it over and over again because the product is so important to them.”

How Peloton is Marketing Beyond the Rich

Peloton is not a traditional luxury product, but it shares consumers with traditional luxury brands. Think about the type of living arrangement necessary to house a wi-fi enabled bicycle or a $4,000 VR treadmill. It’s a brilliant piece of hardware that blends community with product and service. The brand’s proposition explicitly states that the purpose is to free the owner to focus more on experiences.

Peloton’s value proposition is as much about what you can accomplish away from the treadmill. Why take the time to travel to a gym? That time could be better spent elsewhere. This is the mark of a modern luxury brand.

Read more of the issue here.

By Web Smith and Meghan Terwilliger |About 2PM

Member Brief No. 7: Phil’s Dress Shirt


So who wins in the world of micro brands?  This was a question posed by Scott Belsky in his recent article on digitally vertical native brands – Attack of the Micro Brands.

I think this mass of micro brands with massively efficient marketing are, in aggregate, having a much bigger impact than anyone thinks. Using hyper-targeted marketing, just-in-time manufacturing, and social media, these brands find and engage their audience wherever they may be. Of course, small brands are nothing new, but they typically remained small companies. Now I’m hearing about more and more of these brands with tiny teams generating over $10M in sales, with higher-than-normal-retail profit margins. 

Featured atop of Monday’s letter and read by 20+% of openers, the article generated quite a few submitted questions. The most important of which I felt I’d answer here:

How does a micro-brand become a household name?

Fast forward to a Tuesday morning and the question became abundantly clear. Younger brands in the digitally vertical space are typically seen on Instagram, Twitter, Facebook, Pinterest, and the like. They tend to be reduced to this type of media presence. The millennial generation will know of them but your boomers will not.

If brands are lucky, they are adored by the product journalism class of digital media: Gear Patrol, Cool Material, Huckberry, Hi Consumption, or the out right buying guides like Uncrate. Free media in exchange for affiliate revenue is a far trade. But even so, that’s not enough for brands to reach the volume of consumers needed to become a household name.

A step function is a function that increases or decreases abruptly from one constant value to another. A micro-brand becomes a household name achieving multiple step functions over its lifetime. It takes a willingness to gamble on brand statements but it also takes quite a bit of luck. As a brand operative or a c-suite level marketer, you yearn for these moments because they can’t be manufactured.

So when I received a surprised text message from Mizzen+Main CEO Kevin Lavelle on early Tuesday morning, I saw a jackpot in-waiting. The brand made him a standard fit dress shirt (with sponsors stitched on the chest and sleeve) with little to know likelihood that he’d actually wear it.  But there Lefty was wearing Mizzen+Main in his pre-round warm up. The dress shirt was a stark contrast to Tiger’s new age Nike polo.

We got connected to his team and are thrilled to have seen the shirt on the course on one of the game’s greatest!

Kevin Lavelle, Mizzen + Main CEO

The photo told a 1,000 word story. And shortly after, the shirt photo took on a life of its own. It was a Twitter account launched by a third party: Phil’s Dress Shirt. Then came the Darren Rovell tweets. And before you know it, Tiger was being questioned about his friend’s choices in competition apparel. And then came the general media stories, the types of stories that aren’t driven by affiliate revenue.

Here were the elements in play:

  • Phil Mickelson and Tiger Woods were once bitter rivals.
    • “We have gone through it a long time, and the better part of 20 years our friendship has certainly gotten a lot better, and I think it’s just age as well. We’re at the tail end of our careers, we both know that. He’s 47 and I’m 42, and we have had a great 20‑year battle.” Tiger Woods
  • All eyes are on Tiger Woods.
    • Tiger Woods’ effects on media and commerce are astonishing to consider. When it comes to professional golf, he doesn’t just move the needle – he is the needle. In 2018, if you happen to watch Woods in contention on a Sunday afternoon, it’s a major event in media, branding, and eCommerce. Here is a focused look at what that means. (Issue No. 260: The Tiger Effect)
  • In the golf industry, you will notice sponsor space on polo shirts, pull overs, vests, hats, and rain coats. But rarely do you see golfers wear a dress shirt to play a competitive round. Even if it is a technical dress shirt, capable of stretch or moisture wicking.
  • It’s The Masters and there is no greater stage. Golf moves the consumer needle like no other.

With one relatively minor investment, a DNVB captured the attention of the media in an authentic way. Not just for the product but for the impact that a product had on an event.

Think Gatorade baths after a come behind victory, or Jordan’s championship performance being attributed to his Nike’s (it must be the shoes!). Think about that time that Lebron wore an Homage tee shirt to antagonize a competitor, or the NBA team that was photographed with a $40,000 bottle of d’Armand de Brignac champagne. Or the granddaddy of them all: Phil Simms shouting “I’m going to Disney World” after the 1987 Super Bowl.

Sports can provides these moments for brands like few other mediums, it’s why marketing executives spend countless hours appealing to athletes and league commissioners.

Darren Rovell on Twitter

There’s some serious competition in the comfortable dress shirt space. Huge opportunity for @MizzenAndMain if they can somehow convince Mickelson one day to play in it.

These are the moments that brands hope for. And these are the types of step functions that brands need when competing against great counterparts like Ministry of Supply. Ministry, by contrast, operates by focusing solely on the types of targeting efficiencies that built vertical brands like Warby Parker. High on web traffic, low on foot traffic.

Mizzen+Main‘s approach diverged, early on. Medium on web traffic, high on foot traffic. Lavelle emphasized a strong wholesale business to supplement eCommerce efforts – reducing the costs associated with online targeting and providing a baseline in monthly revenue that eCommerce-only companies can not rely upon.

For brands like Mizzen, this type of earned media is especially important. Wholesalers are always looking for social proof. This week, they won’t be looking for long.

I was giving [Phil] a little bit of grief for that. All he was missing was a tie. 

Tiger Woods, Augusta National Golf Club 

Read more below:

Tiger Woods, Phil Mickelson both say their relationship has changed over time

CLOSE AUGUSTA, Ga. – Rory McIlroy ran into Tiger Woods on the practice range a little past noon on Tuesday. “I never thought I’d see the day, Tiger and Phil playing a practice round at Augusta,” McIlroy said. Woods laughed. Yes, it was true.

2018 Masters: Phil Mickelson’s button-down dress shirt is generating tons of buzz – Golf Digest

We’re all about golfers pushing style boundaries to look less like, well, golfers. But the Mizzen+Main button-down dress shirt Phil Mickelson is wearing during Tuesday’s practice round with Tiger Woods (and Fred Couples and Thomas Pieters) pushes boundaries in a questionable direction. An ill-fitting gingham shirt screams, “I trade stocks on Wall Street from 9 a.m.

Lefty’s shirt leaves Tiger, fashion police on alert

Apr 3, 2018 Bob HarigESPN Senior Writer Close Senior golf writer for Covered golf for more than 20 years Earned Evans Scholarship to attend Indiana University AUGUSTA, Ga. — Phil Mickelson showed up to Augusta National for a practice round Tuesday wearing a long-sleeved, collared shirt that garnered a good bit of attention.

What’s up with Phil Mickelson’s button-down shirt?

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Phil Mickelson’s button-down shirt raised eyebrows during a Masters practice round with Tiger Woods

Phil Mickelson wore a button-up dress shirt during his Masters practice round with Tiger Woods. Tiger Woods was asked after the round if he had plans to buy one of the shirts. Woods said he gave Mickelson some grief for the shirt and noted that the only thing that was missing was a tie.

Read the rest of the letter here

Disclaimer: Web Smith, LLC is a shareholder in Mizzen+Main.