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Threads Styling’s business selling luxury to uber-wealthy twenty-somethings over Instagram DMs and Whatsapp was well positioned for the Covid-19 crisis.
The London-based company, which founder Sophie Hill began as a personal shopping service in 2010 before relaunching as a social and chat-commerce platform in 2014, said it’s doubled its revenue since the start of the pandemic. It was already growing fast: in 2019, income reached £30.8 million ($42.1 million), up 74 percent from a year earlier, public filings show. Its cohort of young consumers regularly drop thousands of dollars on the platform in a single session, much higher than the average for other fashion e-commerce players.
But the company was also facing pressure as it looked to scale. Threads Styling’s service relies on a small army of in-house stylists and personal shoppers who post content daily and interact directly with its global client base. Expanding the team fast enough to keep up with growth ambitions in new geographies would be an expensive proposition. Instead, Threads Styling is betting expanding its model to enable independent luxury personal shoppers to access its capabilities will provide a solution.
With its new service, dubbed Threads Connect, personal shoppers who meet the company’s selection criteria can plug into Threads Styling’s ecosystem, leveraging its global sourcing and logistics networks, client management platform, and library of content, to power their own businesses. In return, Threads Styling will take a cut from the commission they make.
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“It means that we can expand our network, it means that we can go into new geographies without building out a full team. It means that we can connect with people who are really delivering great service at a more local level, and bring all of this top talent into one community,” said Hill.
It means that we can expand our network...and bring all of this top talent into one community.
The new service is designed to fuel the company’s international expansion ambitions in the lucrative North American and Asia Pacific regions. Threads Styling launched in the US last year and has been active in Asia Pacific since 2019. The market now makes up more than 20 percent of business.
Initially, Threads Styling wants to recruit about 100 independent personal shoppers into its Threads Connect programme, which launches this week, Hill said.
“We built the technology and capability for personal shoppers to really concentrate on what they do best, and that’s client relationships. Our job is to enable them to run a very successful business within our network,” said Hill.
Threads Styling is operating in a fiercely competitive and crowded luxury e-commerce landscape, where giants like Farfetch and Net-a-Porter dominate. But, while still a niche player, its positioning at the intersection of e-commerce and social networking gives it an edge in an increasingly important market segment with high-growth potential.
The so-called “social commerce” space is an emerging channel for luxury brands, as they seek to meet the increasingly important younger generation of shoppers where they already are: on social media. Burberry uses Instagram to sell its “B Series” limited edition drops, which are available for 24 hours, while Marc Jacobs uses the platform to sell entry-level products like its Snapshot bag or Le Marc lipstick. In China, where the social commerce landscape is more advanced, brands have experimented with selling through WeChat mini programmes. During the pandemic, Louis Vuitton began hosting livestream shopping events on Chinese social media platforms for the first time.
Threads Styling offers brands another entry point into the social commerce space. All sales are made over the chat functions of social media platforms like WhatsApp, Instagram and WeChat. Most are driven by “outfit of the day”-style social media content of hot or hard-to-find luxury products posted by the company’s in-house stylists. The company doesn’t hold inventory, but works with over 600 brands and retailers and takes a commission for each sale.
Its customer base is dominated by Millennial and Gen Z shoppers, a youthful demographic luxury brands are anxious to reach. The average order value through its service is $3,200, Threads Styling said. Bottega Veneta, Fendi, Prada, Lorraine Schwartz and Ananya are among the best-selling brands.
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This, along with its personalised approach to sales, is what makes Threads Styling an attractive retail partner for brands, said Hill.
“We have been spending time really focusing on how we use technology to support the customer [to] have a digital version of that very high touch in-store experience,” she said. “I think that actually puts us in a really unique position as digital becomes more prevalent.”
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