Anne Fulwood, AUSTRALIAN FINANCIAL REVIEW WEEKEND
You may have noticed a lot more people these days are leading very healthy or very active lives, especially if what they are wearing is any indication. Casual sporting wear once confined to the gym or hidden in the sports bag is now described, internationally, as activewear and worn virtually anywhere, at any time of the day or night.
Twin sisters Julie and Sali Stevanja have tapped into the trend to convergence between fashion, lifestyle and exercise and founded their online start-up, stylerunner.com, which is, they claim, “the first online store to specialise in premium international activewear labels.”
They activated fast — in just four months they had arrayed stock from 11 local and international suppliers, engaged a marketing company and the stylerunner.com website went live on October 15, 2012. Self-funded, it turned over about $400,000 in the first year to October 2013. In the six months to March this yearn growth is averaging 30 per cent month-on-month and, says Julie: “We’ll be into seven figures by this October. The exciting thing is we were first to market as an exclusively activewear e-tailer.”
For $10,000 they engaged Sydney firm Pulse Marketing to project manage brand development for the launch, and hired a local PR agency to spread the word. The original website cost about $30,000, but up to $100,000 has been spent in the past year to upgrade the site, add an online magazine The Runway and a menswear segment, Stylerunnerman.
“Our goal is to be the Net-A-Porter of activewear,” says Sali, a reference to the international online fashion hub whose founders should out to the Richemont Group for £350 million ($630 million) in 2010.
Research figures confirm more people, mostly women, want fashion as well as function in their activewear across all price points. Examples of high-end collaborations include Stella McCartney for adidas, Riccardo Tisci of Givenchy with Nike, while the likes of Chanel, Valentino and Kenzo, among many others, have created active ranges. Budget brands Target, Bonds and H&M are also on teen, and Britain’s Topshop has recently announced a partnership with adidas.
A prominent retail market research group in the United States, The Robin Report, interviewed about 5000 people for a sports apparel survey in 2012 and found 93 per cent of consumers choose activewear for activities other than exercising.
Of more than 30 labels offered by Stylerunner, the two best-selling brands are adidas by Stella McCartney and a new Australian brand, The Upside by Sydney based Jodhi Meares. Prices range rom about $30 for a basic crop top or tank, to about $500 for a Stella McCartney cape or tights for $320 by London-based label; Lucas Hugh, recently featured in the movie The Hunger Games.
In mid-March Stylerunner announced a deal with Australian activewear label Lorna Jane to be the “exclusive online partner” for a range of about 10 – 15 pieces from a new collection, Uniquely Lorna Jane.
The sisters highlight three keys to growth in activewear: innovation and improvements in the quality and manufacture of fabric; the evolution of the consumer where people are making healthier choices and exercising more across all demographics; and a revolution ij consumer attitudes where people are “more confident to throw away the old gym gear and get out in something loud and proud”.
Their market is “yummy mummies”, young fashion-conscious women looking for cool, new styles at the right price point and “type-A professionals” who seek high-quality, stylish garments as a status symbol and are prepared to pay the price.
From a family of four daughters, the Stevanja sisters, now 33, grew up in Adelaide’s working-class northern suburb of Parafield Gardens, where their father was a construction worker and their mother worked night-shift in a local factory. Both took completely divergent career paths.
Sali left school in year 10 and among her various jobs, from retail to call centres, to a nightclub, was once at Salisbury Council taking telephone complaints: “It taught me how to be resilient.” Single, with a nine year old son, she worked in Canberra and Melbourne in recruitment for about ten years, and has recovered from a double mastectomy in 2008.
Julie has a degree in management from the University of South Australia and worked in institutional finance at ANZ, while investing in property in Australia and Singapore.
Both sisters personally funded the start-up as equity partners in Stylerunner and profits have been reinvested. They share a Sydney apartment with Julie’s husband and share the workload at Stylerunner, where “we both are doing about 10 jobs at once”. Julie manages corporate strategy, marketing and buying, while Sali runs operations, customer service, dispatch, and social media.
All orders are processed, packed and shipped from the inner suburban Sydney headquarters, a 250-square-meter space leased for about $5,500 a month. They employ six full-time staff. New stock arrives most days and arrangements with suppliers vary, giving Stylerunner options to cherry pick product for sale, order in advance, or sell on consignment. Margins range from 45 to 55 percent.
They ship about 40 parcels a day, average spend more than $150, each with a personalised message and a 60-day return policy. Couriers are chosen based on cost, aggregated by the online shopping system Temando.
Long-term growth will be driven, say the Stevanja’s, by social media. They pay a monthly retainer to a public relations agency, and have more than 64,000 followers on Instagram, about 18,000 of Facebook and a database of about 8000.
Photography for items for the website is their biggest cost, currently about 10 per cent of overall revenues.
They post up to eight Instagram images a day which “start trending” and always lead to slew, exemplified by an exclusive offer in January of bikini tops and bottoms from Australian swimwear designer NLP: “Within one hour, one of the styles had sold out and now we have a waiting list.”
Long-term plans include “joining with a strategic partner to grow this globally” and introducing retail stores to act as shopfronts for distribution centres.
“We want to be a destination for inspiration as well as selling everything a girl needs to look good!” From the gym to the shops, the office, the supermarket, lunch, school pick-up and even on to dinner.