Selling without stores: Online sales help startups establish retail business

In an age when many consumers are reaching for their cell phones rather than their car keys to shop, the traditional retail storefront has become less appealing to many young entrepreneurs. Instead, they are embracing the age of social media and digital marketing to meet their customers online where it's free to test their new concepts and products.

"We just want to make money before we spend money," says online entrepreneur Carlie Newby. She and her roommate, Laura McDonald, launched their online clothing shop, Urban Rose, in 2014.

The online store grew from an Instagram account (urban.rose) that used specific hashtags to make its items searchable online. Once she and McDonald tested their market group and realized they were selling a style of clothing and jewelry that was in demand, they decided to spend money on their own website.

"We're building this in this way to get where we want to be," Newby says.

"And, if a (bricks and mortar) space doesn't work out, you could lose it all," McDonald agrees. "It' all about putting your stuff out there without the risk."

Enoch Elwell, director of a Chattanooga business incubator group called Co.Starter, believes this is a trend that will continue to flourish and can be viable for virtually any business.

"It's one of those rare things that can actually reduce the risk," he says. "Before you invest too much in infrastructure, you make sales It's really great to see this shift happening and getting closer to a pure business. Somehow we got things backwards building infrastructure before seeing if the model works."

Homegrown Silver and Stone owner Taqqiya Ronco said the online-first concept is what allows her popular Frazier Avenue jewelry store which will celebrate its two-year anniversary later this year to be successful now.

"You can test out your market," she says. "It's a really small or nonexistent overhead and worth it to see what people will buy and won't buy, as well as what you're good at. We can't expect everyone else to love what we love."

Ronco said online sales were also invaluable in the beginning to help her determine a price for her items.

"My price points used to be way too low. We were getting so much business but it took so much energy to keep it going," she says.

Urban Rose is now facing some of those same pricing transition issues, McDonald says. As the online store's eclectic, gypsy inspired vintage clothing and accessories style finds a foothold in Chattanooga, she and Newby must factor in labor costs.

Until now, the design duo has simply spread word about their Instagram-inspired business by word of mouth and a desirable hashtag. But, thanks to trunk shows with other local artists, they have caught the eye of downtown business The Baggery (located in Warehouse Row) and an online group, The Mischief Collective, based in Colorado.

"We still want to provide quality, cool handmade things for people that aren't outrageously expensive," she says. "But we also don't want to lose money."

Elwell, whose Co.Starters program is a part of the larger Co.Lab resource for local business, calls concept of selling on social media intuitive and easy.

"The core idea is still the same," he says. "How can you, tomorrow, get your product that is in front of you today to the right customers?"

Katie Brobst, an artist and teacher in Chattanooga, is designing a new website for her business and says she quickly learned the value of social media to promote her art.

As the daughter of a woman who once owned a small crafts store, she says she's cautious about growing her concept in the regular retail way. Although she would love to grow her business, she wants to do it in a productive and financially conservative way.

"But this being only online is the best of both worlds," she says. "My teaching job is what I get my benefits from but I have afternoons and summers off to do my designing."

Rather than having to rely on galleries and markets to promote her products, she has her Katie Brobst Designs Facebook page, and now a website with a domain name that costs only $13 per year.

"It's amazing how easy it is to connect with people who know people," she says. "One lady found me on Facebook because a friend's friend liked my page. She reads to her little kids every night and wants to line their playroom with paintings of books that they like, so she commissioned all these pieces from me. It's just about getting your name out there and getting people to see what you can do."

Now, Ronco's prominent Frazier Avenue store sells not only her own designs, but those of more than 15 other artists all local. She says learning what people will purchase online has contributed to her current storefront's popularity.

"To think back to the online store when I got out of college no one was buying. I had stuff on there and no one wanted it I was so frustrated until I started making these random stacking rings. Then it went crazy," she says.

These days, an item that appears on her store's Instagram homegrownsilverandstone will almost always be sold in less than 24 hours.

"It's just selling to the demand rather than trying to create it," Elwell says. "It's just good business."

This story appears in the February issue of Edge magazine, which may be read online at www.meetsforbusiness.com

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