Web-born boot store stepping off the screen
Like other ‘digital native’ brands, Tecovas goes brick-and-mortar
With handmade cowboy boots, Western flair and a direct-to-consumer sales model, Paul Hedrick set out to upend the boot industry.
The Harvard University graduate quit his job at a private equity firm in New York to start Tecovas, a company that sells men’s and women’s cowboy boots, in 2015. Born in Houston and raised in Dallas, he considers the footwear a staple.
“I was the guy wearing
cowboy boots in the office on Monday,” Hedrick said.
It also helped that he had experience working with brands.
He also was exasperated by the high price and intrigued by a strategy he saw retailers like eyewear brand Warby Parker succeeding with — cutting out the middlemen, lowering prices and selling directly to customers through a website.
It worked. Tecovas enjoyed several years of solid sales online, with boots selling for about $200 to $400 a pair. Yet the retailer, like many other so-called “digital
native” brands, is branching into brick and mortar.
In March, the company opened its first store in Austin, where it’s based. It recently opened another in San Antonio and plans three more in yet-to-be-identified cities later this year.
Starting the company online helped Hedrick, 31, gauge interest and learn more about Tecovas’ customers at a lower cost. Technology is becoming easier and cheaper to use, he said, and provides a way to expand the customer base quickly with less capital. But opening a physical store always was in the cards.
“We knew that we wouldn’t be able to offer the best retail experience until we could do both” — sell boots online and out of a store, Hedrick said.
As legacy companies like Sears and Toys R Us close their doors, e-commerce startups are setting up shop. Mattress company Casper, sneaker startup Allbirds, Warby Parker and other online brands plan to open at least 850 stores over the next few years, a 2018 report by JLL notes.
Web-born brands can test the market before taking on the overhead that comes with opening stores, said Gene Williams, first vice president at commercial real estate firm CBRE.
“It allows them to focus on the products,” he said. “With brick and mortar comes cost.”
Contrary to what people assumed when the internet took off, retailers with both websites and physical stores tend to be more profitable, said Paula Rosenblum, managing partner at Retail Systems Research (RSR).
People thought online stores would bring in more money than physical shops because retailers wouldn’t have to pay rent and could automate the selection of products — what customers see on the homepage — rather than having store staff handle it.
“It turns out that’s not true, most especially in apparel,” Rosenblum said.
That’s largely because returns are expensive to process online, she said, and people don’t make many impulsive purchases online. The majority of retailers that participated in a recent survey by RSR said stores still are their most profitable sales channel.
The stores that retailers of all stripes are opening tend to be smaller and focus on the experiential aspect of the customer’s visit. The shops serve as showrooms, allowing patrons to touch and interact with the products. At Tecovas’ shops, people are offered complimentary drinks and boot shines. Cowhide stretched across a wall at the Austin store depicts surrounding counties, and in San Antonio it’s an Alamo motif. Similar to the company’s website, boots are displayed with simple descriptions.
“I’d rather it feel more like a home than like a store,” Hedrick said.
Large e-commerce brands tend to start with a flagship store in a major city, such as New York or Chicago, and often in trendy, high-end shopping centers, said Guyla Sineni, vice president at commercial real estate firm JLL. Some add restaurants to the store.
“It drives customer traffic,” she said.
Physical stores also can be leveraged as a means of filling orders, and, above all, they serve as powerful advertising channels, Rosenblum said.
Customers “see it, they get to know your brand, they get to know your product,” she said. “It’s a great brand ambassador if you do it right.”