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Customers skip the line as warehouse, sample sales shift online amid pandemic

VANCOUVER — Last year, more than 2,000 shoppers descended on a Toronto pop-up store, looking for deals at undergarment maker Knix's first warehouse sale.

VANCOUVER — Last year, more than 2,000 shoppers descended on a Toronto pop-up store, looking for deals at undergarment maker Knix's first warehouse sale. It was a success: the company sold out of most items during the three-day event and needed to double its staffing.

Knix planned a bigger event for April 2020 at a space four times larger, but scrapped that plan in favour of a virtual sale as the COVID-19 pandemic created insurmountable challenges for an in-person event.

"That became clear when we went to remote work and closed our stores," said founder and chief executive officer Joanna Griffiths.

Some retailers known for annual warehouse or seasonal sample sales are shifting those events online amid the pandemic and finding the digital switch offers new benefits such as broader customer reach, lower overhead and more consumer insights.

For Knix, the virtual event outstripped last year's in-person sale.

About 3,000 customers waited for the Knix site to go live at 10 a.m. April 23, the company said.

It sold more items in the first 10 minutes of this year's sale than over the three-day event in March 2019, and in just over an hour its sales outdid all of Black Friday. In the first 30 minutes, it rung up $500,000 in sales.

The success was welcome after the scramble to quickly shift the event online.

The company hustled to build two new websites for the virtual sale — one for Canadian consumers and one for Americans. It worked with its fulfillment centre, which was originally going to transport garments to the warehouse sale, to move inventory into the online system instead.

One of the biggest challenges to navigate would be managing the assortment of items.

The company had to work to remove or hide products from the website quickly as they run out, said Griffiths, to avoid frustrating customers.

Customers also couldn't try items on before committing to a final sale, meaning no returns allowed. Knix planned to make staff available for online support to help shoppers select sizes.

Sizing items virtually was also an issue for Hilary MacMillan, a Toronto-based womenswear brand, at a digital sample earlier this month.

The fashion brand founded in 2013 holds several such in-person events each year and had one planned for the end of April, said Lindsay Ditkofsky, the company's vice-president of brand development.

The coronavirus pandemic prompted the label to shift the sale online. The label, which sells runway samples initially created to clothe models much taller than the average consumer, knew sizing could be problematic in the virtual space.

"There's always a challenge when it comes to how does something fit a body," said Ditkofsky, adding the company attempted to overcome that problem by providing detailed item descriptions and accurate size charts.

Knix realized the online process would be smoother for customers in some ways.

In 2019, eager customers lined up around an entire block of downtown Toronto. With a virtual sale, there's no waiting in line, Griffiths said.

Shoppers didn't have to navigate a large space filled with clothes either. All the products were laid out neatly online with about 20 staff available over live chat to answer questions.

This makes for an easier shopping experience, said Griffiths.

Hilary MacMillan saw some benefits to the business as well.

"Any time you do something digital, there's sort of a paper trail," said Ditkofsky.

Website analytics showed the company where visitors were located, how many were coming to the site for the first time and other metrics that a brick-and-mortar sale doesn't provide, she said.

It also allowed the company to reach more customers than just those near its Toronto studio space, which it uses for the sales and personal appointments.

"We reached a totally new level of customer that we haven't been able to touch before with this kind of event."

Griffiths has started suggesting to her industry peers that they should think about moving warehouse sales online as well, though she's yet to hear of another company planning a similar move.

Vancouver-based clothing retailer Aritzia Inc. holds an annual, multi-day warehouse sale in Vancouver. The company declined an interview request.

"At this point, no decisions have been made regarding our warehouse sale," wrote Anna Cordon, senior manager of public relations.

For Knix and Hilary MacMillan, the switch to a virtual warehouse sale may become permanent.

Griffiths expects the company will hold next year's event online regardless of whether physical distancing restrictions are still in place.

"Now that we've done all this work and ... we think it's better for so many reasons, I think this will be a virtual, annual thing," she said.

The fashion label, on the other hand, wants to incorporate the digital component while continuing in-person events, said Ditkofsky.

Both women believe Canadian consumers, who are often criticized for lagging behind Americans in e-commerce, will become more comfortable shopping online during the pandemic, especially as more retailers move their stores online and finesse the digital experience.

"I think that Canadians are more comfortable shopping online than we give them credit for," said Griffiths.

This report by The Canadian Press was first published May 2, 2020.

Aleksandra Sagan, The Canadian Press

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