Birchbox, a beauty retailer known for its mail subscription service model, opened its one and only brick-and-mortar store in New York's Soho neighborhood about a year ago.
But Monday the retailer, which began as a pure-play e-retailer in 2010, said it’s opening two more stores next year, including one dedicated to men’s products.
The company will decide where the two new stores will go by crowdsourcing customer votes for where to place pop-ups in three U.S. cities. The two best-performing pop-ups will get permanent physical stores.
Birchbox has treated its current physical store as a lab and a marketing opportunity from the get-go — taking in information that its customers give them in store and using the store’s elaborate customer experience to show customers the beauty of its brand. Birchbox employs cameras and heat sensors to track customers as they shop and try samples — the data help the company discover which products receive the most attention and which are actually purchased.
Birchbox began with the innovative idea of beauty subscriptions — boxes of products arrive monthly filled with product samples for subscribers. If the customer takes a liking to any sample, they can find the full-sized version on Birchbox’s website. But the retailer has found that too many of its subscribers are buying those full-sized versions from some of their competitors. Samples may appeal to one of their subscribers, for example, who might buy the bigger bottle from Sephora.
Now the retailer is focusing on how to increase those sales outside of its subscriptions. Enter physical stores. What the Soho, New York store has shown the company is that visitors to the store are more likely to stick with Birchbox than even many of their dedicated subscribers.
“It's been profound," co-founder Katia Beauchamp told Entrepreneur magazine. "A customer who knows the company and comes in the door has three times the value when she touches the Birchbox store than she would in a normal life cycle with us.”
That's another point for brick-and-mortar retail.