California Apparel News

The last two years have seen streetwear shift from denim to activewear. Everywhere, women are sporting yoga pants, running tights and other clothing once reserved for the gym while running errands or even dressing them up with heels for evening.

“Consumers love the comfort of athleticwear and the ease of wearing,” said Marshal Cohen, chief retail industry analyst for the NPD Group. “Forty-nine percent of people wear athletic-inspired clothing with no active intention.”

Brands and retailers are looking for new ways to sell active apparel to a wide range of consumers and at all different price points.

In the middle of this industry and style sea change is Fabletics, an online activewear brand co-founded by actress Kate Hudson.

“Kate has been an instrumental partner,” said Don Ressler, chief executive officer of JustFab Inc., which owns Fabletics as well as other online fashion brands. “She works with our design team on ideas for the collections, wear tests our new styles, provides design feedback and loves to engage with our community.”

Founded in 2013, Fabletics is part of JustFab (www.justfab.com), an online subscription e-tailer with some 3.5 million active members. JustFab Inc., owned by Ressler and co-founder Adam Goldenberg and launched in 2010, has a portfolio that includes JustFab, FabKids and ShoeDazzle.

Ressler and Goldenberg met while at Intermix Media, the original parent company of MySpace. Goldenberg, a boy wonder who became Intermix’s chief operating officer at age 20, had sold his first company (financed with his Bar Mitzvah money) to Intermix. Ressler also sold his startup, a fitness company, to Intermix. Eventually, the pair left Intermix and launched three other online companies besides JustFab, a monthly subscription fashion website known for its shoes but that also sells denim, bags and jewelry.

To join Fabletics, JustFab’s newest e-commerce site, shoppers take a quiz about their workout habits, color preferences and size before being directed to sign up for membership. Members agree to pay $49.95 for an outfit per month. Each month, Fabletics members must go online and pick an outfit or click “skip” to suspend the monthly charge for that month. If they don’t “skip,” they will be charged and that amount can be used as credit for a future purchase.

Fabletics’ mission is to offer high-quality activewear for women of all sizes at an affordable price.

For example, one of the outfits listed under “Kate’s Picks”—ensembles chosen by Hudson—includes cropped pants, a bra and a shirt for $69.95 or $34 for new members, who get a 50 percent discount when they sign up.

On Instagram and Twitter, members praise Fabletics’ style and variety, using social media to cheer with each delivery and treating themselves to new outfits when they reach fitness goals.

Part of Fabletics’ system includes community building to encourage fitness and healthy lifestyles. The website has a “Masters” page featuring its fitness ambassadors who host events and provide content to help guide and inspire the Fabletics community to achieving their fitness goals.

“I think the outfit deal is super great, especially since I wear workout clothes for my job every day, said Carol Gourlay, a fitness professional in Orange County, Calif. But Gourlay, who typically wears a small bottom and medium top, found the Fabletics fit off for her.

“I love the product. However, I purchased size small, which was too small—[I] gave the outfit to my daughter,” she said. “My next purchase was medium but was too big. However, the fit is just not right for me.”

Although JustFab does not share membership numbers by brand, Fabletics seems to be working.

“After just 17 months in business, Fabletics has been exceeding its plans each month,” Ressler said. “The consolidated JustFab Inc. business will generate north of a half billion dollars in revenue in 2015, and it will be profitable this year.”

Last year, El Segundo, Calif.–based JustFab got $250 million in capital from TCV, Matrix Partners, Rho Ventures, Passport Special Opportunities Fund and Shining Capital, according to Ressler. The investments prompted industry experts to estimate the company’s worth at about $1 billion, but because JustFab is a privately owned company, that valuation could not be confirmed.

According to Ressler, the membership model keeps Fabletics’ prices up to 40 percent lower than its competitors—and its members returning to the website.

“The program works,” Ressler said. “Our average VIP visits us nearly 30 times per year, and last year our VIPs saved $245 million.”