As the brand celebrates its 30th anniversary and the opening of its new store in South Kensington, the CEO of eccentric US home decor and furniture brand Jonathan Adler, Justin Sonfield, speaks to Retail Week about the importance of DTC, its position in the luxury market and his plans for the UK
What has challenged you since you started at the brand in 2019?
“One of the big challenges of the business that was they had a tonne of bricks-and-mortar stores. So they’d overflexed that and weren’t able to fund the stores appropriately with inventory. They had an underdeveloped ecommerce business and the wholesale business was first to market in any given situation, so they’d sell through most of the product before we’d even be able to get to all the stores, or direct to consumer, etcetera.
“The stores were, at one point in time, in great locations and then as bricks-and-mortar was softening, there was definitely a need to pull back on those. So we did; we closed 17 stores and went to much more of a flagship model, focusing on major city hubs in the US and then in the UK. Then we put all of our efforts behind the ecommerce business. For the wholesale business, we said: anywhere where we can’t reach ourselves direct-to-consumer, the wholesale business can fill in that gap – really prioritising the direct-to-consumer nature of our business, right-sizing the stores and rebuilding our entire tech stack when it came to ecommerce.
“We finished resizing the store footprint at the beginning of 2019. Then we started the ecommerce replatform in August with a target end date of March of 2020, and we all know what happened in March 2020. So we were positioned perfectly to capture a new channel of business that was obviously going to become greatly important over that period of time.”
You saw a boom over Covid-19 and have kept it going, how have you managed that?
“Like everyone that’s in the home furnishings business, we had quite a growth spurt and now there’s a little bit of a cooldown. However, we’ve maintained our business. When I say maintained, I mean that we’re still 77% ahead of where we were when I started in 2019.
“Obviously, we saw dramatic growth in 2020, dramatic growth in 2021/22. In 2023, in the first half of the year, it was a little bit challenging but the second half of the year thus far has been great. Our orders even in the rougher first half have been up.
“One of the reasons why we are successful is because we have products across the entire category of home. Where some brands are focused on one aspect of home, whether it’s furniture or lighting, we have something for the customer at any aspect of any buying occasion – candles, little trinket trays, we’re a strong gift destination. So while our big ticket purchases definitely start to slow down at a greater pace, bringing our average order value down, our loyalty and number of customers picked up.”
Has the lipstick effect during aided the business during this economic downturn?
“We sit in an interesting place. We’re not Hermes-expensive but we’re not cheap either. We have this nice little position in the luxury market where we are affordable for many, many people to either stretch up to or to kind of step off into and so we kind of have two drinks of water.
“The glamour and positivity of the product is something that the customer gravitated to. We’ve sold so much colour and so many of those pieces that were a little bit more tongue-in-cheek. Very much the lipstick effect.”
You recently opened a store in London, where do you see the UK business going in the next few years?
“The UK, for us, has always been our gateway to the rest of Europe and the Middle East.
“We are incredibly bullish about the opportunity in the UK and I do see that there’s definitely opportunity to do more from a retail perspective. Our ecommerce business has of course grown tremendously. We also distribute all of our goods not only for the UK but also for Europe, the Middle East and sometimes even into Asia, in the UK. Having that hub, having the store, is a good ground operation.
“I’ll be honest, Brexit has presented brands of our size with a lot of challenges that set back pace. We had to recalibrate a lot of things but I feel like we’ve gotten past most of that. Businesses that are very large either have mobilised units that can figure all of it out a little bit more efficiently, or have the size that they can say, ‘I’m gonna operate in Europe, and I’m gonna operate in the UK’. We don’t but we’ve made our choice. We’re going to continue our UK-based operations as opposed to moving into Europe and now we have distributors across most of the major European countries and so far, so good.”
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