Case Study: Decor Therapy

(re)ALIGN Expansion Sherpas help global home furnishings distributor, largely to brick & mortar customers, to enter and expand a new “channel” – Ecommerce. Sherpas design and build the business from $1 to $10M revenues in two years.

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Background

Décor Therapy Story

• The CEO of a distributor to brick & mortar stores was fretting about market share losses and margin erosion. Sound familiar? I asked “what about channel expansion, into ecommerce?” While open, he knew the challenges, on the customer side (channel conflict) and operationally (shipping and invoicing many small orders instead of one 40’ container at a time).
• We quickly assembled a team of Sherpas, researched both market and operational investments needed, and built a new brand – Décor Therapy was born a few months later.
• We pursued the channel expansion opportunity with a vengeance, and built credibility internally by selling “free inventory” (headed for the liquidator, at a loss) at healthy margins online.

Challenge

Define, refine and scale an ancillary channel (Ecommerce) without creating core channel conflict

Décor Therapy
• The holding company was looking for additional growth stories to position itself for sale.
• An ecommerce strategy required a well-coordinated answer to all the questions outlined in this diagram.
• Sherpas were assigned to build the business model (research, design the brand and sales collateral, build the process for selecting/uploading SKUs, and coordinate with the Ops team) and to champion great execution.

Strategy

find a gap* in the market, and a market** in the gap

Branding
Channel Strategy
Sales
Product Operations
Backroom Operations

Deliverables – Execution:

Market (demand) side

Branding – we defined the UVP, the target customer, and the assortment parameters
Channel Strategy – what websites are most viable for Décor Therapy?
Sales – who can help us ”sell-in” and more importantly, upload content and “sell-through”?
Product Operations – what types of product (and packaging, and price, and margin) are ideal for this project?

Deliverables – Execution:

Operations (supply) side

Backroom Operations – we coordinated warehousing and accounting processes
As internal start-up, we relied on ”borrowed” resources from other departments.
While frugal, this created an absolute need to plan and “turbo-communicate” (verbally or in writing) to get buy-in and timely execution.
We created custom formats for visibility reports, such as PD Calendar and Flash Report (for SKU and Sales by customer)

Outcomes

Décor Therapy ecommerce business evolved from an “accidental $1M” business into a profitable $10M business within just over two years
Our “turbo-communication” and focus on execution helped propel this business on over 15 websites.
Another successful example of the Third Growth Option