Welcome to the #3 issue of Growth Systems!
You are already 42 readers, thank you, it means a lot. I’ve been thinking of publishing more, going from twice a month to once per week.
What do you think about it?
Today, we’ll study a clothing brand that achieved impressive growth:
2016: 1M€ after 2 weeks only
2018: 5M€ ARR (annual recurring revenue)
2020: 10m€ ARR
2022: 23M€ ARR
All that is fully online while always being profitable.
We’ll analyze their brand and development strategy, to figure out how their approach fueled their growth and can inspire yours.
Let’s dive in.
If it’s not done already, you can:
Summary
About Asphalte and its founder
Highs and lows of their model
Their growth and marketing strategy
Inspirations and hacks to steal
About Asphalte and its founder
First, what is Asphalte?
It’s a clothing brand that has a sustainable and eco-friendly approach to fashion: they take pre-orders and then produce the clothes. That’s the only way* you can buy their products.
*(actually, there’s an other way, we’ll talk about it later).
Having to pre-order your clothes and wait sometimes months before receiving it is the opposite of fast fashion. Asphalte is disrupting this industry and is helping it to change.
They started as a brand for men only, but they recently started to also sell clothing for women. Their style is pretty classic and simple. Take a look 👇
Nothing too fancy, but it’s still an elegant collection. And there is a reason why: the founder’s vision.
"Our job is not to make fashion, it is to make clothes that last", says William Hauvette.
Asphalte clothing is made to last over the ages, both in terms of style and quality. This also justifies the order delay, as customers have to wait weeks or months to receive their purchase, but the brand justifies it as “good clothes can’t be made overnight.”
Before we dive more into their strategy, look at these great photos taken from their website (some of you know I worked as a photographer, so I do recognize nice photos when I see some ahah).
Highs and lows of their model
Pre-orders are difficult to do.
You have to sell a product consumers can’t touch, have to wait for (and they are not used to doing so), and have no guarantee it’ll please them. And it’s more expensive.
So brands that succeed in doing their first pre-order drop usually put their revenue straight into buying stocks of products, to reduce their costs by buying in large quantities and to become able to sell fast at any time.
And yet, William Hauvette, Asphalte’s founder, not only managed to do one pre-order drop but based his entire model on it. Stunning.
He was already a founder and CEO of a clothing brand, Six-Sept (Six-Seven), before launching Asphalte. He used this experience to organize the launch of Asphalte: by building a MVB (Minimum Viable Brand), and a mailing list.
Once the mailing list got to 10,000 emails, he launched the first pre-order.
That allowed him to sell:
300 t-shirts on the first day,
2500 sweaters in a month,
to over 2000 clients.
These are really impressive stats for a non-existent brand.
There are many pros to the pre-order model.
You can predict the demand
Pre-ordering allows Asphalte to accurately predict demand for their product before it even hits the market. This allow them avoid over/underproduction and ultimately save costs.You can Increased cash flow
By taking pre-orders, Asphalte can increase its cash flow before the product is even released, which can be used right away to fuel growth.You get early feedback and learnings
Pre-orders can also provide early feedback on products, to see which ones sell more and why.It creates a sense of exclusivity
Limiting the availability of the product to pre-orders only, can create a sense of exclusivity and hype around the product, which can lead to increased demand.
But these pros come with lots of difficulties to face.
It has long wait times
Pre-ordering can sometimes mean a long wait time before the product is actually available, which can lead to frustration among customers.It discourages buyers
It’s a big barrier consumers have to overcome.It can lead to over-hype the brand’s products
If a product is over-hyped, customers over-expect their delivery, and the cloth can fail to meet customer expectations. It can simply lose the customer who won’t buy from Asphalte again, lead to negative publicity, or damage the brand's reputation.It lacks flexibility
Once a product is sold, you have to produce it, or it will severe your brand’s image. What happens today is that costs are rising, and it may become a hindrance if you sell a product at the price you thought was fair, but finally have to reduce your margins.
Also, pre-orders mean longer sales cycles, which means customers buy less often, which means lower customer lifetime values, which leads to slow growth.
That’s what we’ll analyze now.
Their growth and marketing strategy
Asphalte made pre-orders for their weapon but focused their strategy on one thing: their customers.
It comes from involving them from the very first part of creating clothes to having a seamless customer journey.
Growth always has the same core: customer engagement.
By involving customers early into the whole process, Asphalte rise their engagement and will to follow and be part of the outcome.
It improves retention (see where I’m going?).
The whole pre-order-only model restrains the company’s growth in time, as each purchase takes time and is more expensive than the market, blablabla.
So focusing on customer engagement, which means retention and referral, allows the brand to grow with fewer customers, but with a higher lifetime value.
This isn’t just about having a survey before each new clothing, it’s a global effort mixing:
Brand building
Customer nurturing (through emails + social media)
And constantly working on making the brand worth consumers’ attention.
But of course, it relies on customer satisfaction, so the quality of the products is compared to the customer’s expectation.
In short, Asphalte involves customers creating the products they want, engaging them through the process, selling but not over-sell the product’s quality, and delivering something that meets the customer’s (so controlled) expectation.
It’s important to say since its launch, the company raised funds to invest in development:
to ensure their supply chain was on point and could deliver more and more,
to fund the launch of women’s clothing,
and to grow quickly abroad, in Europe.
To develop revenue streams, they put their best-sellers available all year long (still in “pre-order”, but not a temporary one).
Also, the products that are the most sold at each drop are over-produced and then sold on their website directly, without having to pre-order it, but at a slightly higher price (which makes the pre-order even more appealing, hello FOMO).
Women clothing, opening in new countries, and selling more expensive products without pre-orders through their website, allowed Asphalte to grow in just a few years.
Today, they have less than 50 employees (without counting manufacturers) and do 23M€ ARR.
This is a perfect example of how focusing on retention, through customer engagement and brand building, can lead to fast, sustainable, and profitable growth.
Inspirations and hacks to steal
Before we talk about how all of this can help your business, just a short question:
What do you need at the moment for your business?
If there is any way I can help you, feel free to write me ;)
Back to our subject.
What we can learn from Asphalte is that being laser-focused on the right thing can lead to success.
The founder focused on:
Having a Minimum Viable Brand (a mission, the core messaging, values, a vision…)
Having engaged customers, by building the hype and momentum for each drop
Having an Owned Media (the email list)
Being profitable, with pre-orders
It all started with:
One target audience (men in their 30s, in France, with the budget to buy good quality clothes, and wanting to change their habits to eco-friendly ones)
One type of product (t-shirts and sweaters)
One offer (pre-order clothes)
One channel (website)
One media (mails)
That’s why, if you are focusing on your number of followers, likes, how many social media you’re on, how many products you sell, to how many types of audiences, stop.
Learn from the famous proverb: The Riches Are In the Niches.
Focus on what matters to your growth and revenue, and expand once it works.
A few examples:
Clean and organize your databases and email lists before spamming promotions
Get a good organic strategy working on social media before going into paid
Have a good conversion rate on your website before doing ads on Google
I did say there would be “a hack”, so here it is:
Ask your customers.
Asphalte’s surveys are their cheat code.
It allows them to build the product consumers want, in the quantity they need, at the price it will sell.
When is the last time you asked your customers, your clients, and your audience about what they like about your work? Or about what they would want you to improve?
It’s a gold mine of information too many people ignore.
That’s it.
This is the end of today’s issue. I hope you liked it.
I wasn’t organized at all, and I am finishing this the evening before the due date. You wouldn’t have known about it, but I felt like sharing you.
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See you in two weeks,
Take care.
Gaspard