Casey Golden (RTS #46)

Guest: Casey Golden
Topics: Luxlock, luxury brands

Transcript:

Chris Ressa 0:00
This is retail retold the story of how that store ended up in your neighborhood. I’m your host, Chris ReSSA. And I invite you to join my conversation with some of the retail industry’s biggest influencers. This podcast is brought to you by TLC management.

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Ressa 1:09
Welcome to retail retold everyone. Today I am joined by Casey golden. Casey is the founder and CEO of Lux locks. Casey has been in the enterprise retail and fashion industry for over 15 years. I’m excited for her to join the show today. Welcome, Casey.

Casey Golden 1:30
Thanks, Chris. I am so excited to chat with you.

Ressa 1:34
Great looking forward to it. So why don’t we start with you telling us a little bit more about who you are? Your history and what you do now.

Golden 1:48
Yeah, so I started off on as a store manager at Abercrombie and Fitch back when it was cool to work there. And essentially moved over to being moving over to being a million dollar seller at a luxury brand retailer and kind of got hit by the the first recession during that time period and learned a lot of lessons and, and really just moved through the digitization and E commerce back in 2007. So I’ve been there in the early days trying to help brands like adopt digital. And now I am doing full digital transformation with LuxLock for omni channel clients, Eileen.

Ressa 2:37
Excellent. And who were some of your clients.

Golden 2:44
Some of our clients today or some of the people that I used to remember who just

Ressa 2:47
Lux Lux work with?

Golden 2:50
Yeah. So we have brands, Robert Comstock is one of our our newest brands, and kind of a legend in the leathers. And they just, they just came on board. And we’ve got leather specialists that are selling live online on his ecommerce store. And then we also have port Ciana, which has been doing really great and amazing and sustainable brand. We actually launched with 25 female founders to start our company. So it’s been a very interesting, very cool.

Ressa 3:26
Okay, and so help the listener understand, what are you actually doing for the clients? So what is Lux Lux doing?

Golden 3:38
Yeah. So the way that you shop at a in store at a luxury brand, when you have a personal shopper that works with you, you work with a retail associate on a regular, regular basis. And they just spoil you, they know you inside and out. They know what you like, they recommend products, they maintain a constant conversation with you. And they spoil you you get flowers on your birthday, you might get us open tickets, they know all of your lifestyle. They help you do all of your shopping for your family. These are things that just don’t exist on it when you’re shopping online. And so essentially looks like is going on to the brand’s website. And we’re replacing live chat and removing call centers from the conversation and we’re putting retail sales associates online so that they can sell live and they are maintaining their relationship. So we were able to we had to kind of rebuild the way that chat works. And now you can be assigned to a sales associate maintain that relationship. And we were we patented group product messaging so we’re the only messenger that actually has embedded products into the messenger. There’s no affiliate links. There’s no US or else, and you’re able to put outfits together on the fly. So, we do that. And then we carry that conversation into stores, and across all the rest of the brand assets. So when we look at the industry, luxury brands, own restaurants and hotels and clubs, they own crews, companies, vineyards, and at the end of the day, they’re CRMs don’t sink within their organization or across countries. And so LuxLock really kind of bridges across there so that you can get instantly recognized when you walk into a brand’s restaurant. And they can drop the bottle.

Ressa 5:39
Got it? Got it. We all know

Golden 5:43
like a bottle dropped at dinner instead of a email marketing message. Right? Like, pick up the

Ressa 5:52
so if I go on one of your clients websites, how quickly can I talk to a fashion consultant? Three seconds, and this is a real live human being I’m speaking to

Golden 6:08
you are and every single time you go back, you’re gonna pick up the conversation right where you left off.

Ressa 6:13
And is there to start the conversation? Is there a cost to me?

Golden 6:20
No, it’s free for consumers. Incredible.

Ressa 6:26
We’ll talk more about that. As we get on. I think everyone now understands a little bit more about what you do. Let’s go to the section I love called Clear the air. I got three questions for you. Are you ready?

Yes. Question one. When is the last time you tried something for the first time?

Golden 6:48
I just had a laka who’s amazing.

Ressa 6:52
Amazing. You’ve never had one before? No. All right. Love it. Okay, number two. What is one skill you don’t possess? Wish you did?

Golden 7:06
I’m terrible at promoting myself. I am not a great marketer. But I really wish I was.

Ressa 7:13
Understood. Okay. And number three, what is one thing most people agree with, but you do not.

Golden 7:27
But you can’t build a real relationship?

Ressa 7:30
Online. Got it. You think you think you think there’s still the doubters out there given all the other dating apps in the world? The

Golden 7:44
those relationships move into real life, I believe you can have a digitally native relationship that’s meaningful. Most people don’t feel like those people are actually friends, or could be turned into real friends. And I think that can be alright.

Ressa 7:59
I like the perspective. That’s a new one

Golden 8:02
doesn’t mean definitely change things as we all moved on online.

Ressa 8:07
Okay. Let’s dig in. One of the things you talk a lot about a lot of different things in retail. One of the things that I find interesting that you made mention when we were offline? Is this customer acquisition cost that’s gotten crazy. Very challenging for maybe less so in your space. But for the non luxury retailers, it’s nearly impossible to turn a profit online given reverse logistics and customer acquisition costs, essentially a little different, higher price points, higher margins. But one of the things you said is you’re working on increasing sales without increasing ad spend. So why don’t you talk to us a little bit more about that. Yeah, so

Golden 9:03
for premium products, especially in luxury. I use the example like an Instagram post does not sell an RMS bag. That’s not going to convert and there’s no discount. So digital marketing spends with discounts, great urgency. luxuries much more about exclusivity, you’re paying full price. There is no discount. It’s just whether or not you can get your hands on a Birkin bag or not. Right. And so a lot of these brands are new to selling online. So a lot of the inventory is in a store instead of being available online. Only maybe certain items are so when we’re looking at spending $10,000 To put behind one Instagram post or Instagram AD. The the return on investment is is not really high. Right like it’s not driving a large amount of sales like more commodity are like mass merchant products. It’s so much more of like an emotional post. So they have all of these sales associates that have been working on commission for decades, that have been managing customer relationships manually. And they do millions of dollars in sales a year without ever needing an ad, without sending email marketing themselves, they’ve built these relationships. And, and all of these sales are happening in person with a salesperson at the physical stores. But everybody’s shopping alone online. And so that’s kind of point is, if you were able to shop with a professional online in real time, can you replicate the emotional magic that comes with it that makes shopping fun, and then have an enjoyable moment. And if we have all of these salespeople that are now available to shop with you, on demand, we’re seeing conversion rates that are typically only happening in store, we’re seeing these conversion rates online. And so we run essentially, you have a self serve conversion funnel, which is just your self serve ecommerce store. And then we’re layering on top of a guided experience on the same brands website. So that you can have a guided experience or a self serve experience, and working on getting more consumers that you drive to your site to go into your chat, connect with the stylist, and convert. And the next time they come back, they get to pick up the conversation where they left off, you know what they bought. And you can keep maintaining, like a pull strategy rather than focus all of your dollars on a push strategy. So we like customers to start increasing their customer retention cost for a budget. So if you have you’re willing to spend $40 to acquire a customer, are you willing to spend $1,200 a year to keep a customer that spends $200,000 a year? And if so, what are you willing to do for them? I’m just looking at it a little bit differently, as how much does a new customer add value to versus making sure that the current customers you have? Are all having a great experience? You know, it’s like can you take care of what you have before you go get more? How are you treating your customers once you get?

Ressa 12:36
Yeah, so I think as it relates to retail, and many of my listeners, you’re in a different ballgame. I don’t think most of the people listening, myself included, are spending 200 grand at one retailer annually. And so I think that just was astonishing in itself. So but helpful to think about the clientele you’re talking about.

Golden 13:11
But it matters for like you bought your iPhone.

Ressa 13:17
That’s an luxury purchase. It’s something where

Golden 13:22
it could be one pair of shoes, it could be a t shirt, it could be a pair of jeans that costs you know 160 There’s they’re still you have to choose between which pair of Made in America jeans are made in LA jeans out of these, you know 250 brands that manufacture out of there. Which one are you picking? Are you buying from seven for all mankind? Are you buying from ag Are you buying from Hudson? Are you buying Levi’s it’s still like such a brand preference that those stories need to be told. And walking into buying five pairs of jeans online, trying them on at home all by yourself, shipping them back. That’s a supply chain issue. And it’s a bad customer experience just as it is walking into a retail store and somebody throwing 30 pairs of jeans in a fitting room. That’s not awesome, either. So it’s like no matter where you’re shopping, if you’re if you’re shopping for something other than just core functional use, like I need a cell phone charger. If you’re buying something that you wear, typically you want, what’s it made out of? Is it itchy? Does it fit true to size? And does it shrink? You know, there’s all these questions that people have during the purchasing process that just need a little bit more than a call center. You know,

Ressa 14:42
yeah, I think that’s that’s true. And I think where I typically go with that is that’s a definitely one of the advantages and values to a store and why luxury brands still open new stores today.

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Ressa 15:42
I’m curious being someone who’s, you know, you mentioned on the channel but also focused on the tech side. what your take is from your lens, especially in this luxury place of the importance of the store today.

Golden 16:01
I mean, to me this store is is a critical component to the dream, right like luxury brands build these like magical dreams that you want to be a part of you want to experience it the brand. I just had a we just flew one of our top stylist into New York City for the first time for her birthday because she had never been to New York before. And the eyes and the excitement when she walked into like Saks Fifth Avenue on Fifth Avenue. Like it is that whole thing of you see, everybody sees these different versions of what a store is. And it’s, it’s when you walk into that store, I mean, it’s magic. You’ve been romanced by these brands for decades. And you’ve seen them in movies, you see them. And it’s it’s such a component where you get to go and touch and feel and experience it. And you get to be excited when you get to take your little bag out and you get to take it home. I don’t feel that like it’s just about buying a product and a transaction. It’s all of this engagement. And it’s like learning about the brand. And I think that stores are going to have like this core component that yes, it’s important to have a store, it’s not so important to have a stack of 16 shirts on a table. Because I think it’s just going to be more about education of the brand experience of the brand, really connecting with the consumer so that they feel more connected to understand why they want to save their money or why they why they want to spend their money with them. And having that brand experience and trying different new technologies to make it immersive and exciting. I think it should be fun shopping is supposed to be fun. That’s what makes shopping so amazing, is that it’s partly entertainment. Otherwise, we just buy everything on Amazon, right? I kind of go back to this analogy that like shopping was invented like 200 years ago at Selfridges. Everything before that was like, trade. I give you this, you give me that. We hash out dollars and cents. And literally it was like about trade. And I think Amazon did a great job at scaling trade. But shopping was created when you just went to the store to hang out.

Ressa 18:35
I love that. I love that. I think I think that’s really great. The one thing I would challenge you on and I think that it’s it’s hard to see this improving, which is I agree with everything you said even about the store experience engagement and whatnot. where I differ from a lot of people is I do think the store is still going to be a critical place to sell product. Because by and large in and this is a little different in your space, but generally a more affordable way for consumers to purchase and the retailer still make money. They profit on the four walls of a store so it makes good business for a retailer to sell product through that channel versus having 40% customer acquisition cost online and losing every time I sell online where the retailer wins and they sell it in a store. I think the divide has gotten so big and it’s clear the profits in In the store, I think it’s hard for them to can to move more and more online because they’re selling more and more in a loss, right? If my wife orders four shirts returns, three pays no shipping, retailer loses. Right? Seller loses. And so that’s where the store comes in. And so I, I get into this a lot with people where, yes, I agree that the experience, the education, the brand experience, the magic talked about, need to improve for retailers and is all going to be their tech enabled stores, I think that’s going to happen. But I also think that stores are just the more profitable venue to sell through, and therefore retailers will continue to do that. Do I think it’s just stacking high and let it fly. It’s harder to do that today, you have to have a really the team to actually educate and the experience there. But I do still believe you will see product in stores, and people walking out. Instant gratification discovery of the product, all that stuff.

Golden 21:16
I just went through. i My office is in Soho. So whenever I go to a meeting, like I get a walk through Soho, and I walked by a Ralph Lauren on my way to a meeting. But as I walked by Ralph Lauren, on my way back to the office, I had to take a few steps back because I’m like, No, I just have to go in. Because it’s like, it’s Christmas inside. Like, I know what Ralph Lauren smells like during December. I know what it feels like. And I just I had to go in. And it’s just, it just felt like so at home. And the presentation was gorgeous. There’s beautiful stacks of three. Everything made sense. It just I wanted to explore the store, I wanted to buy everything I saw. Because it is it’s that emotional pole of like instant gratification. My biggest pet peeve with shopping online is that you are expected to know what you want. As the second you get there. Because it’s asking you, do you want to look at tops or bottoms? Do you want to look at short sleeve shirts or long sleeve shirts? Like, I don’t, I don’t know, like I just I, I want to go shopping, I want something. I don’t know what I want. And then we get into these long lists of like, never ending scrolling, where to the point where nobody can make a decision. Because there’s still like seven pages left. And I’m like, I think I’d have to look at all seven pages before I can purchase this item that I think I like. And when you walk into a store, you can just take it all in the discovery

Ressa 22:53
process. It’s hard to replicate online to in store

Golden 22:57
so hard. Yeah. And that’s kind of why I’m just like, you know, keep yourself surf fine. I wouldn’t spend a lot of money on it. Personally, I don’t believe in like, convert the traffic you have. Make it easier for customers to shop. And I’m just like, just click a button, talk to a stylist, let them take you through the discovery, try and get that emotion and get the job done and book an in store appointment. You know, and get people into a brand. And I think that that’s really important. Because

Ressa 23:28
does that happen a lot? Are you bringing people through digitally, and then and then sometimes moving them to a physical store?

Golden 23:40
I’d love to say that we were but we launched in February of 2020. So all the stores so we’re not there yet, because I need more more customers that have stores that are that are open. And that’s kind of, you know, during 2020 A lot of in store software initiatives kind of just got set to the side. And everybody really focused on that digital experience, which is great. But 80% of the revenues are coming from physical stores and and it’s such a staple in our community of this act of shopping and what a mall is. And I think it’s just a core piece of like our community in general and just like how we so like socialize in general. I don’t really think we can take that away.

Ressa 24:33
Do you think your technology will start to do that to bring people both online and in store?

Golden 24:41
Yeah, so I believe in real life. I like I mean, I’m actually a huge ecommerce advocate or like, I sell everything in commerce because I’m transitioning in store methodology to it. Because I believe in Like, without memory, like, my whole being of like, being on Earth is to engage with other people, and to experience things and make memories. Other than that, like, there’s no reason for us to be here, right? Like, at the end of the day, it’s the memories and the people will engage with. And I just don’t see a lot of that happening online. To give you like a sense of purpose on like, the last breath you take, I believe in real life. And we have to find a way to kind of merge that. But I want you to be able to buy something online or buy something in a store, and the brand to make sure that you’re doing more things that you love, right? Like, instead of spending $80 on this customer to acquire them over the next three months, just pick up their next SoulCycle session or send them to the theater, what do people have to do when they go to go do something in real life, they get dressed, you know, like, they get dressed. And you can get into a cycle of being able to do more real life things. If you spend money on clothes, the brands are gonna take care of you and make sure you have some place to work. And really convert some of that traffic from experiencing the brand online to experiencing in real life, but it’s difficult.

Ressa 26:27
So you’ve opened me up to a world what luxury brands are sending people to the US Open, Ralph Lauren, really. So I shop at Ralph Lauren, and probably go there four or five times a year, we get all our kids clothes there we go to the Woodbury Commons in we get a lot of kids clothes at Ralph Lauren. And we do, we definitely go to Carter’s and we go to J Jill and or Jack and Janie. And we go to a bunch of places. But we do get a good shop at Ralph Lauren. But I’m probably a few, a few bucks a year, I don’t know that I’m worth us open tickets.

Golden 27:11
But see you are. So if they’re if a brand is willing to spend $25,000, for an influencer, to make a post that converts into a miniscule of sales, maybe one like these don’t convert very high, then you’re worth your four purchases a year for the last 10 years, you’re worth us open tickets. Wow. That’s a great point.

Ressa 27:38
I need to send an email to Ralph Lauren.

Golden 27:44
And that’s really the point that I’m kind of focused on is like take care of your customers, give them what they want. We don’t want to be sold to we want to feel the brand. So like Ralph Lauren sponsoring the US Open like these brands have budgets that they spend on their customers and on their top customers because they’re managed. To such a detailed degree, the relationship is so strong that I know exactly what bottle of wine and year to send you. I know that you’re allergic to cashmere, like we just don’t have a way to scale that all the way down to the point where we can send all of our customers flowers on our their birthday. Like that is every single person is going to post that they’re going to tell their friends, as adults. Equinox was the only birthday present. I got back this year, they sent me a $200 gift certificate. I love that. I bought presents. For me. They didn’t send me a coupon. But the only reason that happened is because I complained to the Director of Marketing last year.

But you know, really kind of put in perspective and we can get if we take care of our customers, our customers will take care of us. So maybe we shouldn’t be spending so much money was our Herberg. And he started spending more cost more money on customers like you that we can depend on you to go shopping four times a year, every year.

Ressa 29:19
Right. Okay, we’ve been talking for a while. What have we missed? What haven’t we covered that we should talk about?

Golden 29:27
I think it’s a big, I think brands and retailers have a big opportunity to kind of embrace more tech and embrace more startups speaking as a startup. Everybody wants to work with a tech company that already has, you know, 100 big brands that that are using them. But in order to get to that point, your tech may not be necessarily innovative or solving today’s problems. And so I’d like to see more brands be Oh Been to experimenting and kind of adopting that fail fast? Rather than if you fail, you’re fired?

Ressa 30:10
Yeah. I think everyone talks about it. I do think it’s hard to implement because, you know, people are tied to numbers and, you know, returns on investment. And when those you know, when those slide, it’s a challenge. So, okay, this was great. Open my eyes to a new world. I really appreciate it. I think you did with our listeners as well. I want to bring us to the last part of the show we call retail wisdom. Are you ready? Okay. Question one. What extinct retailer Do you wish would come back from the dead? Tell everybody a little bit more about Colette.

Golden 31:00
Colette is was a street urban contemporary store in Paris. Had all of the coolest brands the coolest products. A it was just like the store you wanted to go to? To see like what’s going on in the fashion scene. It was like the ultimate story to your collection. And they’re gone in like 2017 Nothing’s really come close.

Ressa 31:29
Oh, thank you for sharing. That’s a great answer. No one’s ever said that one. And I’ve asked over 150 people that question. So. Question two. What is the last item over $20 You bought in a physical store?

Golden 31:51
I bought a $70 Sweater at full price in Bloomingdale’s on last Friday before I went ice skating in Central Park.

Ressa 32:01
Fantastic. And then

Golden 32:07
no discount.

Ressa 32:07
And then final question. If you and I were shopping at Target, and I lost you. What aisle would I find you in?

Golden 32:16
Probably home decor?

Ressa 32:18
Well, your Christmas tree looks great. Yep, that’s where it looks. Okay. Thank you. Well, Casey, this was terrific. I really appreciate the time. Lovely conversation. If there’s anything I can do for you. Don’t hesitate to ask. really insightful hadn’t looked at it that way. Clever stuff. Thank you so much.