Make It Work: How Neighborhood Goods is supporting independent businesses

In our new series, we ask creative entrepreneur members how they’re pivoting to respond to these uncertain times. Here, Austin-based member Matt Alexander discusses how his community-driven take on a department store is helping fellow entrepreneurs 

By Corinna Burford   Illustration by Elena Xausa    Monday 29 June, 2020    Short read

When Matt Alexander conceived the idea for Neighborhood Goods in 2017, he wanted to create ‘a new kind of department store’ – a cohesive, physical retail space for digitally native brands like Dollar Shave Club, alongside more traditional companies like Fossil. After about a year of planning, the first location opened in November 2018 in Plano, just outside of Dallas, and was quickly followed by a second store in Chelsea last December. Then, a third opened in Austin this March. 

As COVID-19 has transformed the retail landscape, though, Alexander and his team have had to rethink their approach – working to increase their digital presence, while also helping fellow entrepreneurs who are affected by the pandemic. Here, Alexander shares insights on how he launched Neighborhood Goods and discusses the ways that the company is supporting its community during (and in the aftermath of) lockdown.

Life in ‘the before’
‘Before Neighborhood Goods, I’d started a non-profit of sorts called Unbranded here in Texas, which provides free spaces for independent entrepreneurs, artists and chefs every holiday season. I’d also run two editorially driven e-commerce brands that had been acquired a few years prior. From both of those experiences, I’d recognised the need for more narratively informed and community-driven retail opportunities. 

‘The goal for us was to be like a new type of department store. In many respects, the notion of creating physical frameworks for digital brands is quite obvious, but making it really compelling to the consumer and brands alike is much more difficult. 

‘My cofounder Mark Masinter and I officially opened the doors to our Plano store in November 2018, and it was extremely well received. Serena Williams came and launched a new product line with us, and we got a huge amount of media attention. We had always planned to expand into other markets, and we built the technology and the brand itself with scale in mind.’

The big idea
‘On Friday 13 March, we completed and opened our third store, on South Congress Avenue in Austin. We promptly closed that location, and our other two, indefinitely the following day. 

‘We’d been planning our response to COVID-19 but, overnight, things started to move fairly quickly. With our Austin opening, we’d progressively scaled back all marketing messaging, until we were essentially encouraging people not to visit. Still, though, a lot of people showed up on Friday evening and throughout the day on Saturday. Meanwhile, we were seeing ongoing transaction and traffic volume in New York and Plano.

‘We sat in the store and came to the realisation that it was a problem. I called our board and let them know we’d be closing. We called our managers for New York and Plano, while chatting with our Austin manager and team directly. We let our brands know our plan, as well as assuring them that we had no intention of charging them fees for as long as we’re closed.’

'It’s not a time for profiteering, but for us to do what we can to be supportive to the communities of which we’re a small part'

Taking the leap
‘With the stores closed, we then refocused ourselves for a new environment. In the time since, we’ve started pushing all manner of digital initiatives. We’d seen e-commerce steadily expand for us in recent months, but with the stores closed, it became our absolute focus and has been growing quickly since. 

‘At the same time, we’ve also been thinking about our social responsibility. So, we came up with the idea for The Commons, where we offer free space to brands, musicians, artists and chefs whose businesses have been particularly affected by COVID-19. We’ll launch them online as well as in-store when we’re able to reopen.

‘With The Commons, it’s our hope to help restart affected brands, whether they’ve lost wholesale orders or meaningful portions of sales. Meanwhile, we also want to help restaurants take over our kitchens and build up revenue to restart their own spaces. We want to bring in local employers to host job fairs. We want to bring in musicians and artists – as we have before – to show off their wares. And, for it all, we want to only take a modest percentage of sales. It’s not a time for profiteering, but for us to do what we can to be supportive to the communities of which we’re a small part.’

The response
‘Many of our brands immediately opted in to being on our website, so we now have more than 100 brands available to shop online. We also rolled out a number of editorial initiatives, including Only Good Things, where we’ve been sharing uplifting stories, hosting giveaways, posting memes, and interviewing founders. 

‘Within a week or two of closing the stores, we also launched a social giving aspect of our digital experience. Between two and 10 per cent of transactions are now donated to support COVID-19 relief.’ 

Life in ‘the after’
‘We recognise we’re in a relatively fortunate position and, with that in mind, we hope to extend as much good will and support to others as we can. So, we’re hatching new ideas all the time. We’re speaking to more brands than ever. We’re hearing about more real-estate opportunities. We’re just trying to maintain a positive and lightweight outlook with it all.

‘We’re certainly not unaffected. But we see it as our civic duty to try to be supportive in our communities, regardless. We’re planning to reopen in Austin and Plano soon, while implementing a huge amount of safety and cleanliness protocols. We’re not sure when we can open in New York. But in Texas, we are aiming to launch 10 to 15 Commons brands per location alongside the reopenings, in addition to both of our restaurants opening fully.’

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