By Joe Skorupa
What makes Xcel Brands interesting in the current retail environment is that it is a disruptive success story sprinting toward the $500 million mark in revenue while flying under the radar. If that wasn’t enough, it accomplished the feat at a time when many retailers are struggling to find a path to growth. Here’s a look at one of retail’s rising stars and the virtues of exploding the traditional business model.
Xcel Brands was founded in 2011 by Robert D’Loren as a retail business with the unique mission to reimagine shopping, entertainment and social media into a unified business model. In some ways, Excel operates like a familiar brand management organization, but it pushes the concept further by embedding new-media marketing and interactive TV selling into the DNA of the organization.
Xcel owns and manages such major brands as Isaac Mizrahi, Judith Ripka, H Halston, C. Wonder and Highline Collective from an omnichannel strategy that includes sales and promotions through direct-response television, brick-and-mortar stores, and e-commerce channels. Its product lines include clothing, accessories, footwear, jewelry, housewares, home dÉcor items and gifts.
According to Robert D’Loren, the retailer’s chairman of the board and CEO, the Xcel concept is similar to traditional retail models in some ways and sharply different in others. “We operate on a working capital-light business model,” says D’Loren. “We create partnerships between our brands and retailers in a way that is mutually beneficial. For our retailer partners, we do it all. We design the products, manufacture them, manage the supply chain, and also merchandise and market them.”
Importantly, Xcel Brands takes a fast-fashion approach to its product lines. “From sketch to store takes about six weeks on average,” says D’Loren. “We have removed traditional seasonality because we think the best approach is having 52 seasons instead of two. If you make customers think there will be something new and exciting in the store every week, they will come into the store every week.”
To be social media driven is another essential part of the Xcel Brand mission. Its twofold approach to social media includes carefully engaging and monitoring social media while looking for design elements to incorporate into fast-fashion products and to analyze social media data for insights into brand, product and customer trends.
As noted, one of Xcel Brands’ major channels is interactive TV, notably QVC. For most retailers, this is a largely untapped channel. D’Loren’s aim is to make Xcel Brands a global leader in this medium and tap into its potential to instantly reach and sell to millions of shoppers. Currently, Xcel Brands reaches 350 million households per year though its interactive TV programs.
One channel where Xcel Brands is making strong headway is in signing up major department store partners to carry its brands. Current partners include Hudson’s Bay and Lord & Taylor. A partnership with Dillard’s will launch in the spring.
For those who want to learn more about Xcel Brands’ disruptive approach to growth in the current retail environment, be sure to register for the RIS Retail Executive Summit June 14-16, where Robert D’Loren will be a featured speaker.
While many retailers are struggling to reach today's consumers and find new paths to growth, Xcel Brands has pioneered an innovative business model that differentiates by design to achieve its unique trajectory of success.