Dressbarn CEO looks to 'give more convenience to consumers' through partnership with Happy Returns

SEP 16, 2020

Shayan Zadeh, Dressbarn CEO, joins Yahoo Finance’s The First Trade with Alexis Christoforous and Brian Sozzi to discuss Dressbarn's partnership with Happy Returns, innovation on the e-commerce platform and much more.

Video Transcript

BRIAN SOZZI: The brutal year for retail rages on. Kohl's said this week it will can 15% of its corporate workforce to cut costs. That follows months of retailers announcing bankruptcy filings because of the pandemic. But amidst the storm, Dressbarn is trying to make a comeback after its one-time owner went bust. Shayan Zadeh is Dressbarn CEO, and he joins us now. Shayan, good to see you. Walk us to this model first. I know you have some news out today. Walk us through this model. So Dressbarn is part of a holding company, Retail Ecommerce Ventures, which recently bought Pier 1 and Modells. What is it about this model, and how are you making it work?

SHAYAN ZADEH: Good morning, Brian, thanks for having me. You're absolutely right. We started this process last year looking at storied retail brands that were struggling because of their brick and mortar aspect of their business was dragging them down. And each of these examples that you brought up, Dressbarn, Pier 1, Modells, and we looked under the hood.

We saw a healthy growth in their e-commerce business, which was being dragged down by the structural issues on the brick and mortar side of things. So on these examples, the strategy that we have taken is on the rev acquired intellectual property of the brands and relaunched them as e-commerce only platforms. And the response has been fantastic from consumers.

ALEXIS CHRISTOFOROUS: It really has been fantastic. I mean, I guess before all of these changes, online made up about 20% of overall revenue. Now you're 100%, of course, that way, because you've gone online and done away with brick and mortar. But how has this changed maybe your suppliers? Do you have the same suppliers? Are you branching out to different suppliers? And what about the styles that you're offering? Are you able to take more risk because you don't have to hang on to the inventory the way you would at a brick and mortar store?

SHAYAN ZADEH: No, great question, Alexis. So at the beginning, we always start with some sort of continuity. So we try to bring back the same suppliers, the similar styles, and we are serving that core customer base that we acquire as part of the transactions. But just like you mentioned, because of the e-commerce nature of this, because we can leverage personalization on the web that will be harder to achieve in a store format, we are able to experiment with ideas that could have been too risky for the previous incarnation of the businesses.

A simple example is a swim category at Dressbarn. It had never been a big category. This year on the website, we ran some tests early on and we saw a great response. So we really went big on that category, and the response was fantastic. But this is a example of something that the old Dressbarn would have never taken the risk on, because it would have meant putting a lot out there on the line. And if the test doesn't respond well, you're stuck with a lot of inventory, your stores have been reconfigured, and so on and so forth.

BRIAN SOZZI: So today you're announcing you'll be able to pick up or return your Dressbarn returns, if you want to return which you get, at 500 Happy Returns locations. Is that the first step in saying, you know, if I buy something off a Dressbarn, clearly not me, but if I know someone buying something off a Dressbarn, I might be able to return it at a Macy's a year from now?

SHAYAN ZADEH: That's correct. The idea is to basically give more convenience to our consumers. So at the shopping level of the experience, we feel like the e-commerce experience is pretty easy to use. You browse all of the catalog comfortably, you have search options, you can filter, pick would you like, have it shipped to your door very conveniently. The reverse logistics has always been a little bit clunky. Now if I didn't, if it didn't fit me right or if I didn't like the material as much, now I have to package it up, mail it back, there is cost involved in that element as well.

With the Happy Returns partnership, what we are telling our consumers is, we will provide you convenient locations on your drive to your pharmacy or picking something else up for your home, you can just turn that product in and it's completely taken care of for you in terms of the return cycle of it. So simplifying that element, and bringing that convenient and kind of closing the loop is really the goal with this partnership.

BRIAN SOZZI: All right, we'll leave it there. Shayan Zadeh, Dressbarn CEO, good luck on the path forward.

SHAYAN ZADEH: Thank you.

Article and video were originally published here.