Who is threadless?

Threadless is an online community of artists and an e-commerce website based in Chicago,

Illinois, founded in 2000 by Jake Nickell and Jacob DeHart. It is a crowdsourcing company
(one of the oldest). The Threadless’ concept was quite simple but ingenious because way
ahead of its time. Different artists/designers from any places could be chosen by different
users, if they get enough vote, their art is being spread worldwide through the Threadless
prism and brand label. After that, Threadless is in charge of producing all type of merch with
the art design from the artist on it. It was a great idea that enables a lot of artists to come up
and gain recognition, fame, then start a business. The brand could be considered as
launching ramp. To still get profit from those operations, Threadless get a percentage cut on
every sale, the rest goes to the artist.

What approach does the company use to create new products? What is key to the success of their
business model?

The source of ideas was endless, inexhaustible, due to the amount of web artists and
designers that wanted to get famous at that time. The approach is simple, artists are
publishing their work on the website, users can vote, work with the most votes get their
Threadless collaboration.

The key is that there is no misstep nor mistake possible as long as there are users down to
buy merch and artists down to publish their work on the platform. Automatically the merch
will be sold because it has been voted by the users (de facto the customers). It was a perfect
cycle while everybody stays at its “place” on this economic cycle.

It worked so well because as previously said, users do not feel like being on a purchase
website such as amazon or ebay. It feels more like a social media regarding art and design.
There are bloggers that are encouraged to share content, about their lives, to promote the
brand, or also making web content about the Threadless designs! It has really embraced the
concept of community with real actors since the brand isn’t involved in any part of the
creation outside of the merch. All the ideas, pieces of art and design are being concepted
between users and artists.

Should Threadless move into physical retail distribution? Why or why not?

The power of Threadless currently resides on its concept and the fact that it is an online
platform. They have already evolved since their creation in 2000; the first problem that
appears to Threadless was to keep high-quality merch by keeping their main artists/designers
and stopping them from leaving. They came up with “Artists shops”, the concept was to
consecrate some space on their platform to the artists that wanted to sell their own merch
and goods. On another end, it was contradictory to the brand identity to make some room to
let the artists do their own thing, it wasn’t Threadless no more in a way.

Going into a physical adventure does not seem like the right thing to do according to us. How
could they keep the quality at its best? They will receive lots of offers to franchise their brand
and create different stores, maybe they’ll find themselves overwhelmed by the situation.
Furthermore, Threadless is an online community and it will kind of betray the brand identity
to move into physical distribution. Even though, we have some good ideas if they must got
into physical distribution.
If Threadless were to move into physical retail distribution, how should the company proceed?
Should it open its own store or sell through an existing retailer?

It is clear to us that if Threadless were to move into physical retail distribution, they should
keep the stranglehold on their business. We had this idea of opening a flagship store in their
hometown of Chicago, it would be the unique Threadless store around the world. This store
will be more like a place of art with temporary exhibition from different Threadless’ artists.
We imagine a giant store with areas consecrated to art expression when artists come and
present their work, customers will have the opportunity to vote. As it was for the platform,
the work with the most votes will gain an exclusive collaboration.

Regarding the merch available, since it isn’t possible to stock and sell every merch available
on the website. The best way to sell will be classical; inspired from the website there will be
the “Essentials” and the “What’s new on Threadless”, a great feature of what they sell the
most and the new trending design on the platform.

By building this exclusive store they will perhaps succeed moving into physical distribution,
based on the exclusivity and the attractivity. Remember that Threadless at its core is a solid
database of people full of excitement.

If Threadless were to move into physical retail distribution, what should the relationship be between
its online vs. physical distribution? (use placement course content too)

There should be a direct relationship between online and physical distribution, the store
should the platform’s mirror, especially in the idea of what the users have of the platform.
The store has to be a place of culture sharing and great interaction in face-to-face between
online users and artists, as well as the Threadless creators and staff. The possibility of
organizing online contests and set up finals and last steps at the store, the teasing of event
and exclusivity online that will appear in the store. The best way to exploit the opening of a
store is to set up collaborating action between the platform and the store, like this they will
be able to maintain the craze around both the platform and the store.

What has eroded Threadless competitive advantage?

The first factor that we have seen is that obviously it is the hardest thing for a company to
maintain the hype around its activity. Threadless has been in the trend for the whole 2000’s
but it seems like it has lost in popularity since the 2010’s. The trend over design graphic
merch isn’t as well trendy as it used to be.

Another point that make them lose their competitive advantage is the terms of the contract
that Threadless was proposing to the artists. Most of the artists hasn’t made a lot of money
even though they were chosen a lot by the Threadless users.

How could the company improve its co-creation process and strategy?

As we said earlier, we had this idea of creating one big flagship store in Chicago. This place
would be huge with areas dedicated to creation, artists “from the outside” will come to
present their work and consumers will have the possibility to pick one design (artist’s work)
and then feature it on merch.

Another idea that we’ll have to look into is the possibility for the consumer to create their
own design. Held by Threadless employees, it could be a step forward in the co-creation
concept by bringing the platform “users” to come physically and express themselves through
 their creation. Also, it could be seen as a second chance if they have missed their shot on the
platform.

Thank you for your reading. We hope you have enjoyed it.

This worksheet has been made by Sébastien Jobard, Maxime Jacquot, and Basile Parovel.