Rhone CEO Nate Checketts discusses how his activewear brand rapidly adapted to the initial COVID-19 pandemic shock, foreseeing inventory gluts and promotional pressures. He shares Rhone's strategy of quick promotional deployment and value-driven customer communication, including strategic discounts and useful email newsletters. Checketts also posits that the crisis will act as a 'clearing house' for less resilient brands, particularly those over-reliant on brick-and-mortar, while highlighting the importance of agile leadership and transparent employee communication.
Key takeaways
Implement rapid response strategies for market shifts, like developing a promotional plan within 24 hours to address changing customer demand and competitor actions.
Prioritize customer communication that offers genuine value (e.g., useful content in newsletters) rather than just promotional messaging, even when offering discounts.
Carefully manage inventory and be prepared to strategically use promotions during market downturns, recognizing that deep discounting by competitors can shift customer demand.
Consider a crisis as a potential 'clearing house' event that may eliminate less agile competitors, creating opportunities for well-positioned brands.
Maintain transparent and honest communication with employees during uncertain times to foster trust and stability.
Rhone CEO Nate Checketts said his company "saw the writing on the wall really quickly" in the early days of the coronavirus pandemic.
Companies like his men’s activewear brand would soon be bloated with inventory and feel the pressure to boost e-commerce promotions.
"If everybody's getting promotional all at once, that's going to shift customer demand away from us if we're continuing to operate at full price," Checketts said. "So I challenged our team in 24 hours to get a promotion ready and to be ready to effectively communicate to the customers about what steps and actions we were taking."
That plan included an email newsletter that's actually useful to readers instead of just being a distress call -- and the rare discount on Rhone products. "We won't go deep, but you will see brands that will have to," Checketts said.
"In some cases it might act as a clearing house to get non-serious players out, and that will present some opportunities. I do think that brands that I won't name but leaned so heavily into retail before they were really ready for it are in a lot of pain now," he added.
Even on Rhone's e-commerce front, he said, "there's definitely been a demand impact, no question."
Checketts talked about leadership values, what brick-and-mortar landlords should keep in mind and how he's staying honest with his employees.
Implement rapid response strategies for market shifts, like developing a promotional plan within 24 hours to address changing customer demand and competitor actions.
What does this episode say about supply chain & operations?
Prioritize customer communication that offers genuine value (e.g., useful content in newsletters) rather than just promotional messaging, even when offering discounts.
What does this episode say about brand & content?
Carefully manage inventory and be prepared to strategically use promotions during market downturns, recognizing that deep discounting by competitors can shift customer demand.
What does this episode say about founder & leadership?
Consider a crisis as a potential 'clearing house' event that may eliminate less agile competitors, creating opportunities for well-positioned brands.
What does this episode say about dtc strategy?
Maintain transparent and honest communication with employees during uncertain times to foster trust and stability.
