Internet sellers, however, have not been kind to retailers selling hard goods. Developer EastBanc, which developed Cady’s Alley and other Georgetown storefronts, is keenly aware of this, and it informed the company’s thinking recently when one of its tenants, Baker Furniture, forfeited some of the space it had been renting.
Rather than immediately re-leasing the space to the highest bidder, Philippe Lanier, who heads asset management for EastBanc, split the space — a total of 8,000 square feet on two floors — into five parts and offered each to online fashion brands he considered promising.
The “pop-up bazaar” opened Nov. 15 and will run until at least Jan. 5. Lanier, whose father, Anthony, founded EastBanc, said it will serve as a test for whether the company and its partner, Jamestown Properties, can take the much broader step of transitioning Cady’s Alley into a destination for buzzy online brands.
Lanier said he is aiming to account for the fact that more shoppers are coming to Georgetown to try things on but then buying online, a phenomenon called showrooming. For traditional retailers, which rely on sales from their stores, showrooming is problematic and has become a factor in how they design their stores.
“Shoppers are already accustomed to shopping online,” Lanier said. “They like to be able to go in and try things but they doesn’t need to walk out with a box. They don’t need that immediate satisfaction.”
For brands that are primarily online, however, having a brick-and-mortar store, especially just during the crowded holiday season can be a good way to build a brand. “It’s much easier to create brand ID when you have a physical structure,” Lanier said.
The five companies that now occupy the former furniture space at 3330 Cady’s Alley, NW, between the Bulthaup and M2L showrooms, have already found some success online. There’s Tuckernuck, founded in 2012, which calls itself “an online retail destination curated for the classic, all-American lifestyle.” Zestt offers home goods, Read Wall offers men’s wear and Victoria Road sells handbags and accessories.
Chubbies sells shorts of all kinds, ranging from $50 to $60. The owners use their Cady’s Alley space in part for a “man cave” with a beanbag toss (corn hole) court, Lanier said. “At the end you say, ‘I’ve got to leave with a pair of shorts.’ ”
All of the companies are untested in that they have little or no experience actually running brick-and-mortar stores. But three of them have local ownership and customers bases and those that don’t know that they have customers in the area. “They have all sorts of statistics from their online sales as to who their buyers are. And they said they have a great number of purchasers from the D.C. area,” Lanier said.
Whether or not the Laniers are successful in turning their experiment into a permanent fixture at Cady’s Alley is undetermined, but in Bonobos, the men’s wear seller, they have a model for how to do it. Bonobos started online and now has eight “guide shops,” where customers are offered the chance to try things on, and is also in Nordstrom.
Lanier said that rather than signing Bonobos to a regular 10-year lease, he started it with three one-year deals followed by a two-year lease and then a five-year option. “My focus on this one was making sure that either party could get out if they felt like it wasn’t working,” he said.
Since EastBanc and Jamestown began floating the idea to open up more space to online companies, Lanier said he’s heard from nearly 40 people with online businesses, which gave him the confidence to pursue the idea further. “I don’t plan down the road to have eight 24-year-old e-commerce guys [on Cady’s Alley]. We are going to need a mix. But the 24-year-old e-commerce guys are the ones who are trying these things.”
Follow Jonathan O’Connell on Twitter: @oconnellpostbiz