Indochino in unconventional deal with media company to accelerate growth
Made-measure menswear retailer Indochino has entered into a strategic partnership with a leading Canadian media company.
The Canadian retailer is partnering with Postmedia, which represents more than 200 newspaper brands across Canada. Postmedia has committed more than $40 million (Canadian dollars) in media dollars in the brand over the next five years. In return, Postmedia will share a portion of Indochino’s revenues in the Canadian market with the option to purchase its stock at current prices.
Indochino said the agreement will help it exponentially grow its market share in Canada by leveraging Postmedia’s network, which reaches almost two thirds of the Canadian adult population. Postmedia will promote Indochino’s premium custom suits and shirts to its average of 13.4 million monthly unique digital visitors and 8.3 million weekly print readers in the form of print, digital and native advertising.
The retailer has eight showrooms in Canada (and nine in the United States). Postmedia’s print and digital properties will give the brand access to key existing retail markets such as Toronto, Ottawa, and Vancouver, as well as introduce it to emerging markets within Canada on a large scale.
The agreement has been in effect since February, and is already tracking above revenue performance benchmarks, according to Indochino. Canadian net orders are up 63% year over year, and net revenue growth is up some 77%.
“As part of our 2016-2020 plan, we’ve boldly sought out strategic alliances to help us achieve our business goals and this mutually beneficial partnership will no doubt have a profound impact on our growth in Canada,” said Drew Green, CEO, Indochino. “We’re boosting our marketing activity to the equivalent of Postmedia’s largest advertisers, whilst at the same time lowering one of our largest expenses. Both sides have a vested interest in making the partnership work, which optimizes the chance of success and greatly reduces risk. It’s a winning formula and one that I hope will pave the way for similar ventures in other markets.”
Postmedia’s print and digital brands include national and regional newspapers such as the National Post, the Vancouver Sun, the Ottawa Citizen and the Calgary Herald.
“This is a great opportunity for two companies to leverage each other’s strengths in order to grow their businesses,” said Andrew MacLeod, president and COO, Postmedia. “We believe it’s a perfect fit.”