When actress Kate Hudson launched Fabletics in 2013, many people assumed that the brand was simply a startup company with a celebrity spokesperson attached. However, tens of millions of dollars later, it’s clear that the talented Kate Hudson was also born to be an entrepreneur.
As the CEO and founder of Fabletics, her athletic apparel brand, Hudson has developed several bold strategies to further the company’s success over the last four years. From the brand’s unique subscription service model to her innovative take on brick-and-mortar stores, it’s clear that Fabletics isn’t going anywhere anytime soon. Now that the brand is outselling Amazon in the workout apparel department, more and more business moguls are taking notice of Hudson’s fresh yet sharp approach to running a fashion business.
Aside from developing impressive business strategies, Fabletics is also highly successful because of its products. Launched at a time when the athleisure trend was just beginning to take over the fashion industry, Hudson stocked her online store with an endless amount of casual chic workout apparel items like printed leggings, slouchy yet fashionable tank tops and jersey dresses made with sweat-resistant fabrics.
The Subscription Service Model
Customers who shop on the Fabletics website are urged to subscribe in order to become VIP members. As a VIP member, customers can receive a brand new workout outfit each month for a recurring fee of $49.95. Shipping is free.
The convenience of this model has attracted fitness enthusiasts around the world. Upon signing up, VIP members must first fill out a lifestyle quiz that tells Fabletics about what kind of items the customer likes best. Then, Fabletics selects the outfits out for the customer and ships it to their door.
Blogger Teri Hutcheon was enticed by the value of the membership program. Because the VIP membership program discounts each item, Hutcheon was able to get high-quality athletic apparel items for an incredibly affordable price. While most athletic apparel brands charge $50 for a pair of leggings, Fabletics VIP members receive a complete workout outfit for just about the same price.
Over the last couple of years, Hudson has been opening up physical Fabletics stores that follow the reverse showroom strategy made famous by tech company Apple. Instead of relying on the physical stores for a portion of the company’s revenue, Fabletics uses these stores to drive traffic to the online store.
When a customer tries on a piece of Fabletics clothing, that item is placed in their online shopping cart. While they shop, employees educate them about the VIP membership program. Plus, the stores allow customers to see the clothes in person before signing up for the program.
As of now, about 35 percent of customers who have made a purchase in a Fabletics store are already VIP members. About 25 percent of customers who enter a Fabletics store who aren’t already members end up signing up before they walk out.
Thanks to the success of this strategy, Hudson is opening up more stores around the world over the next few years.
If you’re not already a VIP member, visit fabletics.com to take the lifestyle quiz and start getting complete workout outfits in the mail each month.