Allbirds takes flight offline with NYC, SF stores

Dive Brief:

Allbirds on Tuesday said it opened its first flagship store in New York City, a location of more than 4,800 square feet that features the company's redesigned retail strategy. On the same day, the footwear retailer reopened its Hotaling Alley store in San Francisco with a remodel following the same approach, the company said in a press release emailed to Retail Dive.
That entails being "intentionally un-designed," "using natural materials," and being comfortable, the same principles the formerly pure-play footwear retailer said also apply to the design of its shoes. Allbirds worked with Partners & Spade to develop its in-store try-on experience that "could grow with Allbirds as the brand expands its retail footprint," the company said.
And its footprint is indeed expanding: Allbirds has signed leases in Chicago and Boston, and it has plans for stores in Los Angeles and Washington, D.C. in the works, the company also said. The brand aims to open eight stores in the U.S. in the next year, and two permanent locations globally, according to the release.

Dive Insight:

As online pure-play darlings like Allbirds join others like Warby Parker and Casper in putting stakes into actual ground, the notion that retail's destiny is e-commerce becomes increasingly murky.

E-commerce is hardly going away, and more apparel than ever is sold online. Online apparel retailers, particularly pure players, are set to take share from brick-and-mortar rivals through next year, according to global information company NPD Group. The firm also found that almost half of U.S. online shoppers bought apparel last year, and that annual apparel online spend-per-buyer rose 11% compared to 2016. While in-store purchases declined 3% compared to 2016, online apparel sales rose 7% to $46 billion. But the vast majority (76%) still comes through stores, according to the same report.

News of Allbirds' move online also comes amid escalating sales in the athleisure footwear category. Footwear's version of athleisure is the segment's fastest growing slice, with 65% of dollar sales gains, according to new research from The NPD Group. Fashion does remain the largest, growing 5% after two years of declines, but that too is "largely due to the comfort trend," according to the report, which was emailed to Retail Dive.

"With comfort in season year-round and the 'athletic as fashion' movement continuing to progress, comfort is here to stay," Beth Goldstein, NPD's fashion footwear and accessories analyst, said in a statement. "Brands and retailers must find ways to innovate and embrace this new norm."

Thanks to its ongoing materials innovation, which includes shoe soles made from sugar cane and meshed knit uppers made from Eucalyptus tree pulp, Allbirds is also capturing sales that are reflective of another emerging consumer priority tracked by NPD. "Brands must be innovative and have a social and eco-consciousness to succeed in the future," Goldstein said.

"Consumers that will soon make up their largest customer base care about these issues," Goldstein added. "Brands must play in this space and over-communicate their positioning to win over consumers in a footwear market that is both growing and transitioning."