Online retailer Character.com is venturing into brick and mortar retail with the opening of its first ever physical store. Launching today (30 October) at McArthurGlen Bridgend, the Character.com shop will be joined by three more branches in 2024, and coincides with a major brand refresh for the licensed apparel specialist.
LicensingSource.net catches up with Karen Hewitt, Character.com’s co-founder and chief of retail and licensing, to find out more.
News of your first retail outlet comes on the back of a period of consistent growth for Character.com. Can you tell us a little about the thinking around venturing into brick and mortar and where it fits into your overall strategy for the company?
It was a strategic decision that’s been on the cards for a few years, it was just a case of finding the right time. When we started Character.com, online wasn’t as competitive as it is now. There are a lot of purely online players now, so we needed to differentiate ourselves in that space. Also, we were aware of the customer trend of people wanting to go back to the high street, so now felt like the right time.
Online is still going to be a huge part of our business, and we’re not going to pull back in that area. Having a brick and mortar presence is about diversification and future-proofing the business, making sure that we can deliver what our customers are asking for, in the way that they want.
What will the store will be like in terms of size and offering?
The McArthur Glen, Bridgend store is approximately 1,500 square feet. Our original corporate strategy did not include the launch of new retail locations until 2024. However, when the opportunity to establish this particular store presented itself, we made a decisive move to seize it. This decision was primarily influenced by its favourable proximity to our headquarters, facilitating streamlined management of operations. This venture offers an invaluable opportunity to gauge market reception, accumulate insightful experiences and identify areas for improvement prior to our expansion into larger retail spaces in 2024.
Our retail roadmap for 2024 entails the introduction of three additional stores, each spanning approximately 2,500 square feet. These new stores are slated for launch between May and June, extending through September 2024. This timeline is strategically devised to align with the objectives of capitalising on the third and fourth quarters of the year for optimised trading performance.
Experiential is often cited as the way forward for high-street retail. Can you tell us about any ideas you might have around enhancing the in-store experience for shoppers?
When it comes to experiential, our stores will be very children-focused. In our three larger stores we intend to run family friendly activities that kids can get involved in, such as workshops and classes, and events like fashion shows for kids, demonstrations, storytelling, Santa visits… We’ve got so many ideas – I’m not sure I’ll get them all past the cfo! We’ll start small, but the world is your oyster when it comes to experiential. There are some companies in the US who do it extremely well, but for me, it always comes back to asking myself what I wanted to do when I was a kid. Every child hates shopping, so it’s about making the experience fun.
Hopefully experiential will bring in customers and make the store visit about more than picking up the clothes and going straight to the checkout. If you offer something memorable, consumers will want to come back. Luckily, because of the sector we work in, we have fantastic licensor partners who are keen to get involved, so hopefully we can generate some amazing experiences and in-store events that will bring a bit of joy to kids and families.
Can we talk us through your new brand identity? Why did you feel the time was right for a fresh look?
As we transition from being purely an online retailer to an omnichannel retailer, we need to focus more on our brand. That means having a stronger visual identity to pull through into physical stores, but also a brand positioning that reflects our beliefs and the products we sell.
Characters from people’s favourite movies, shows and games make their fans smile, and the same goes for our clothes that feature them. A smile is a simple but incredibly powerful message that is universally understood and multi-generational and we built the new brand concept around it. A smile has the power to make someone’s day better and offers a great device for tapping into more emotional connections with our customers.
[Working with Kids Industries] we’ve used a smile symbol as the basis of our new branding, from the logotype with all the little hidden smiles within the lettering through to the logomark and our new brand mascot – aptly named Miles since he’s always full of smiles – who conveys added emotion through his various poses.
The kids’ entertainment sector is crowded with IP. How do you choose which are right for Character.com? And how quickly are you able to jump on the latest trends?
Quite often the longest delay in getting new ranges to market is finalising the licensing agreement and getting the legalities sorted. But if we go to a licensor and say, look, we’re seeing a reaction to this particular property and we really want to get in on it fast, we’ll take that first-to-market opportunity and offer it for a few months just to prove it out, then they will often sign that licence quickly.
We are lucky that we get to see data about what’s trending through our online searches, and we’ll be able to feed that information through into our stores. Conversely, being able to talk to customers in-store will be hugely beneficial. Yes, we can have conversations now with customers via social media and our customer service channels, but there’s nothing better than talking to kids directly and asking them about their favourite characters or shows, and what they could and couldn’t find in the store.
In terms of being able to jump on trends quickly, we’ve got some good routes now by which we can produce close to home, and we’ve got some great supply partners which means we can take smaller risks on these things as well.
Having an omnichannel strategy will benefit us. Offline, we’ll be space-restricted, but we’ll still have our online channels where we can trial and test things. Whenever we do market research with our consumers, one of our USPs that comes through is the breadth of licences that we offer, and we don’t want to lose that, ever. We want to continue to take risks on things that might not work. Not everything has to be as phenomenally successful as PAW Patrol. If a property ticks over and there’s demand for it, then it works. It’s important for us to serve our customer what they want, rather than what sells in the tens of thousands.
Can you share any upcoming new licences with us? Are you noticing any trends/demand for particular properties?
Now, more than ever, we’re witnessing the emergence of certain standout properties. Take, for instance, the case of Bluey, a relatively new addition with a unique appeal, or the consistently impressive performance of Pokémon. Currently, we’re experiencing an unprecedented surge in demand for Stitch, and the origins of this phenomenon are somewhat enigmatic. Notably, this surge in popularity wasn’t orchestrated by Disney through any deliberate promotional efforts; rather, it appears to have evolved organically, quite possibly through platforms such as TikTok. This underscores the contemporary challenge of navigating trends. They are no longer predominantly driven by licensors but are, instead, shaped by consumer preferences. Success in this domain hinges on our agility in identifying and capitalising on opportunities when consumers collectively decide that a particular property is having its moment in the spotlight.
You’ve set yourselves some ambitious sustainability targets for 2025. How far are you along that journey?
Sustainability is important to us, as it is to everybody in the apparel and licensing industries. It’s definitely a journey and we’re constantly learning. We’re a member of the Better Cotton Platform, so we try to use BCI [Better Cotton Initiative] cotton wherever we can. We’re constantly looking at circular economy initiatives, like take-back schemes, but historically they can be hard to do online, owing to the cost of returning the goods. We’re hopeful, though, that we’ll be able to do more in-store.
Packaging is a big issue for us. We’re constantly reviewing that side of things and making sure that our packaging is as eco-friendly as it can be. We work with charities like Sharewear to donate things like buying samples, which then go to women’s refuges and people in need. We’d love to do something like a preloved store on Character.com, if it’s possible.
One area where I think major change could be made is in the approvals process. We might see five, six, or seven samples of thousands of products before they’re signed off. There has to be a platform that the licensing industry can develop where people are going to accept approvals online, because there’s so much wastage. I think licensors need to start to understand that while we appreciate their brand is important and they want to have autonomy over what’s going out to market, equally they need to get on board with this.
Sustainability is going to become even more important going forward, as consumers demand change. For companies, it’s a question of balancing your sustainability efforts and those of your partners in the supply chain against the profitability of your business. Everyone wants to do the right thing, but equally everybody still wants to be here in a few years’ time.
What are the toughest challenges you’re facing as a business right now?
The difficulties are constantly changing; at the moment, economic uncertainty is a major factor, obviously, as is competitive pressure – but again, that’s why we’re expanding into brick and mortar retail. People shop online for price, so you can deliver the best product ever online and show it off to your best ability with fantastic photography and so on, but ultimately, for the online consumer, it’s always going to come down to how much it costs. This means we can’t necessarily always achieve exactly what we want to, because we’re always trying to buy with price in mind.
Inventory management can be tough, owing to the current economic uncertainty. You try to forecast sales but it is so hit and miss at the moment. However, we have great suppliers who we work really closely and collaboratively with, which helps.
On the flipside, what do you love about Character.com? Is there anything in particular you’re looking forward to?
[Co-founder] Steve and I started Character.com from our garage nearly 15 years ago, and we’re just as excited about the business now as we were back then. Just because we’ve been on a growth trajectory, it doesn’t mean that we’re resting on our laurels – we want to keep pushing forward. We want to be the company that licensors want to work with and be a strategic partner with.
Offline retail feels like starting all over again, and that’s super-exciting for us. if you’re an entrepreneur, you’re always looking for that next thing and this feels like the natural next stage in Character.com’s journey. That aside, it’s a really fun place to work because we’ve got a wonderful team. We sell fun products that make people smile, and we get to work with some great companies and brands that consumers trust, which means they trust us.
I also love the fact that sometimes I get to sit back and think, ‘As a mum, what would I want for my kids? And how can I make it happen?’ One thing I loved doing was the sensory friendly Thomas & Friends range we did in collaboration with the National Autistic Society. I was passionate about driving that forward because I could see how that would genuinely impact someone’s life. I love licensing, I love product, but I also love being able to bring something to market that people actually need as well as love.
