Turning TikTok Home Inspo Into Reality

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Happy Monday, folks.

Twitter is still standing... for now.

Users (and employees) have been live tweeting their thoughts on the platform's grim future while preparing their exit routes from the app or company, whether to newer platforms like Mastodon or even old and reliable ones like Tumblr.

Since Elon's takeover, Twitter has been more experimental than when you tried highlights in your hair in middle school. The app has tried everything from the notorious paid verification fiasco to firing most of the employees and telling those that are staying to prepare for a "hardcore" work style. The nose ring to top it all off? He brought back Donald Trump's account.

Elsewhere, the House of Mouse broke the internet last night when they swapped Bob 2 for Bob 1, pulling another Elon move in bringing back fired employees. Bob Iger was one of the most successful Disney CEOs in history, pioneering the company into big decisions like Disney+ and the purchase of Marvel and Lucasfilm. He was replaced by Bob Chapek in 2020, quite the timing for taking over a company that earns a significant portion of its revenue from crowded theme parks...

Despite the short tenure, the leash on Bob 2 turned out to be even shorter. After reportedly reaching out to Bob 1 on Friday, the terms of the deal were finalized by last night's announcement. Rumor has it Bob 2 was not expecting this news at all. Disney adults and investors alike are excited about the announcement. $DIS opened this morning up nearly 10%.

This week will likely be one of the least productive in history around the globe. For the United States, most Americans have a short (or no) work week with Thanksgiving on Thursday. It's tough to think about spreadsheets and emails when your minds has moved on to sweet potato casserole and hours of food-coma football. Would also recommend getting to the airport family of four level early given expert predictions that this will be the busiest travel week since 2019...

Our international friends won't be much better. The World Cup kicked off yesterday in Qatar. This is arguably the most controversial tournament in the event's long history with allegations of FIFA corruption and the host country's human rights abuses. Even worse? They banned beer from being sold in the stadium, potentially setting the scene for a war between the Gulf country and the nation of Ireland.

Regardless of which sport you're referring to, there's plenty of football for all of us.

Despite the fact that billions of people are tuned in to the tournament given soccer's status as the world's most popular sport by a laaaarge margin, the demand for tickets was no match for those of a girl and her breakup songs. Taylor Swift fans were so ravenous to see the star on tour for the first time since 2018 that they literally broke Ticketmaster.

Not only were most Swifties left without tickets even after waiting hours to get them, but the massive demand caused a ticket pricing surge which drove many of them to resell for tens of thousands of dollars. Taylor said Don't Blame Me and instead called out the ticket platform's parent company Live Nation, for its poor handling of the release.

This isn't the first time that Live Nation has been involved in controversy from some higher ups. The company's initial acquisition of Ticketmaster prompted regulators to explore an antitrust case, a case which has been reopened after this past week. Talk about an Anti-Hero.

While nowhere near as powerful as T. Swizzle, everyone from the Department of Justice to even President Biden has called out the lack of competition in the live event ticket industry and the resulting sky-high ticket prices, criticism which might prove too strong for CEO Michael Rapino to just Shake it Off. I think it's safe to say that there will be some Bad Blood between fans and the platform moving forward after the severe reputational damage it has suffered from this fiasco.

*I take no responsibility for any emotional harm caused by Taylor puns.

We can all remember our first times venturing off into the world to live on our own. Whether it was to go to college with your very own dorm room, as a young professional moving into your first ever apartment, or when you were eight and tried to run away and live in a cardboard box because your mom made you clean your room, it's simultaneously exhilarating and stressful.

You move all of your stuff in, organize and pack it away, and finally crash on your bed to take a second to breathe as you stare off into space only to realize that you're really staring at a sad, blank wall.

Where's the decor? Where's the bounce? Where's the pizzazz? 

In the past, young people have gone to Best Buy or Target or any other number of (no offense) basic retailers to load up on towels and kitchenware. Finally, there's a cooler alternative that makes the process of pimping your crib a breeze.

Dormify is the new go-to retailer in the world of dorm and apartment furnishing and decorating. It offers everything from bedding to kitchen necessities to stylish decor. The brand specializes in everything Gen Z with sections of their website dedicated to dorm essentials, AR visualization tools, and style guides.

Their marketing strategy lines up nicely with this target demographic. They've managed to build up a large following on TikTok and Instagram with hundreds of thousands of followers across platforms. They've partnered with popular student discount apps like StudentBeans, a platform with more than 6.5 million users, and have rolled out micro ambassador programs to help sell through relatable college students. Perfect for all of you aspiring influencers hoping to populate your friends' feeds with product placement.

Rather than using commerical-style paid advertisements, Dormify produces engaging marketing content like room inspiration videos, influencer endorsements, and even how-to videos for relatable college problems like putting on duvet covers and covering holes in dorm room walls. This social media presence is significant considering how important it has become to Gen Z shopping habits. In fact, more than 60% of this demographic plans on using TikTok alone for holiday shopping.

The team also uses social media to stay connected with its target demographic. The home page is set up in a way which fully embraces the power of video by featuring some of the company's social posts. It also features designs inspired by social media with bright colors and room lights which look exactly like you might see in viral videos. Finally, they embrace the distinct aesthetics that dot the social landscape with dedicated sections to "Indie", "Cottagecore", and "Preppy." No matter the personality of the buyer, they are likely to find styles which cater to their distinct tastes. 

Dormify utilizes the direct-to-consumer (DTC) approach for sales rather than relying on a traditional big name retailer. This has a variety of benefits like contributing to customer loyalty; after making their first purchase, consumers continue to shop with Dormify for all of their home needs.

DTC also allows brands to embrace the omnichannel experience. Rather than being something out of a Zuckerberg dirty dream, "omnichannel" just means offering multiple ways to reach customers, whether online, in-store, or through some combination of the two.

Finally, this strategy allows brands to control their messaging and image in a way which occupying shelves at Walmart or Target doesn't. Dormify can embrace its identity as a cool, Gen Z brand by selling straight to their target demo.

The DTC approach isn't without challenges, though. It increases the importance of marketing as the only way to gain customers is for them to intentionally seek DTC brands out. Brands are also often forced to offer more variety as customers want options when they come to the website. Having full control of the supply chain also makes managing a DTC brand far more expensive than if they simply sold to bigger retailers.

Dormify seems very well-positioned to tackle all of these challenges, however. Its strong social media presence suggests it has managed to find its audience and get them to stick. Once customers are funneled to the website, they face no shortage of options for any taste and style, and rather than just buying the bedding they'd come for, they're far more likely to shell out for LED lights and smily face vases for their living rooms. Managing high costs will forever be a challenge, but the company is experiencing rapid growth which should eventually increase profit margins.

The approach has worked, and even amongst DTC brands, the company has managed to stand out. According to Similarweb, Dormify is currently the 9th fastest-growing DTC brand for 2022. Last year's revenue came in at $4.4 million with 50 employees ($88,000/emp). This year, that number has skyrocketed with estimated revenue of $25.1 million (more than $250K per employee) an employee count that has grown by by 69% (nice). We're likely seeing the beginning of network effects as customers tell their friends about where they got that neat charging headboard that lets them scroll on TikTok until 3am every night without their phone dying.

The market for even this specific demographic is also enormous. An individual college student spends nearly $850 on average to furnish his or her dorm. With tens of millions of undergrads in the US, this industry comes out to nearly $10.5 billion every year. Customer supply will never be an issue in this core demographic, but there are also ample opportunities for the company to expand by appealing to younger customers and recent grads who come back to purchase for their first apartments and homes.

The home retail market is a saturated one with competition from established specialty stores like Bed Bath & Beyond and Wayfair, but also growing competition from bigger companies like Amazon and Target. Heard of them? Increasingly, there's also competition from niche retail brands like Urban Outfitters and Zara looking to cross sell their loyal customers with offerings beyond clothes. All of these will always pose a threat, but each suffers from either limited offerings in the "home" departments or from a lack of reputable brand name products.

Dormify is the best at what it does, and that is selling dorm and home furnishing to the 16-25 year old female demographic. It understands the power of social media and trends, and it fully embraces this phenomenon to both reach its target customer and to continue to provide them with ever-changing products to keep them coming back. If Dormify fails, it won't be because of competition.

Thus far, the team has raised an estimated $5.6 million. Two of these rounds were led by American Eagle Outfitters and Clerisy, the first demonstrating the promise of the company (and the market) for traditional retailers looking to enter the Gen Z home decor market with promising, established partners and the latter lead demonstrating the attraction to investors with expertise in the DTC consumer market. This combination of traction and investor support suggests that we are only seeing the beginning for Dormify.

Dormify truly understands its customers. This isn't surprising considering its founders were these customers. The company was founded by Karen and Amanda Zuckerman, a mother-daughter duo who were searching for stylish decor for Amanda's first dorm room. Not finding any good options, they decided to create some themselves.

Both leaders have backgrounds in design and marketing, and they have used these skills to scale the company into what it is today. Karen has extensive background as a creative entrepreneur and now advises her daughter as Chairman. As CEO, Amanda leads a team of more than 100 employees who work to stay up to date with the latest trends, create products to capitalize on them, and get customers excited about buying them.

DTC retail is all about finding your niche audience and embracing it. Dormify excels in this, and it just so happens that its audience and market are large ones that are willing to spend on its trendy products. The consumer pain point is a big one, and the company has positioned itself to dominate its market.

Long Dormify, supplier of Gen Z's versions of "Live, Laugh, Love" signs.

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Cheers to another day,

Trey

P.S. Interested in the business of college football? Make sure to check out Pigskin Economics, a once-per-week breakdown of the biggest topics going from the sideline to the executive suite.