The Fresh Thinker: Dare to compete

Joe Middleton bought customised sports clothing brand PlayerLayer in 2009 and has seen growth of 30-40 per cent year-on-year. He talks about how the business competes against the likes of Adidas and Nike using social media and CRM

Marketing Week (MW): How does PlayerLayer differentiate itself from the big sports clothing brands?

Joe Middleton (JM): The ticket to entry is having a great product but it’s very difficult to differentiate yourself solely on that. We are not going to out-innovate the likes of Nike and Adidas, which have unbelievable research and development departments. We have differentiated ourselves through personalisation [the brand makes customised sports clothing for clubs]. One of the reasons we have taken this on is because the big guys don’t. They think ‘why would we make 15 sweatshirts for one club when we can make production runs of 10,000 sweatshirts’.

MW: How do you use customer relationship management to get to know your customers better?

JM: We needed a CRM system to manage account information, forecasting and reporting without draining the company’s cash reserves. Previously, we did not have a holistic view of the business so we now use CRM software Sales Cloud.

As the product line expanded to 500+ items with hundreds of fabric and colour options, and custom options available online, we created social customer profiles to get to know consumers better. We don’t just see email address and contact information. We understand what customers like, what they talk about with their friends, what their friends like, their influences, and how their tastes are changing. All of this helps inform our marketing and sales strategies.

MW: How does this help you compete with the bigger players?

JM: To succeed needs both human systems and processes but also a massive effort on the IT side. Big companies have the money to put in their IT systems but they don’t go down that route because they have easy ways of making money [via marketing]. They [prefer to use marketing, rather than technology to generate sales]. Most small companies don’t invest in sophisticated IT systems and our competitors don’t. They do it the way we started with a series of spreadsheets linked together, but it just does not work.

We worked out early that we can compete with the big guys with these IT systems because it’s unnecessary to spend millions of pounds on servers and 20 people in the IT department.

Small companies, wake up! You don’t need to be fearful of the big guys. Technology has completely changed the rules

MW: How did PlayerLayer become part of the premium end of retail?

JM: In almost every consumer category there are clearly segmented price levels and almost every category has a luxury sector, whether it’s watches, shoes, luggage or cars.

However, sport doesn’t: the very big market leaders are wonderful brands and globally known but they are not luxury level brands. In general, in the all-round sports brands there is a gap and again we didn’t realise where we were in this. However, we were described by one of our overseas customers that buys our products as ‘that luxury British sports brand’, and we rather liked the idea of being thought of in that way.

There is still an upscale consumer who is looking for luxury or something a bit different to play their sport in – not everyone wants to wear global brands. When we move into Germany, for example, we are moving in through the rowing clubs, so immediately we position ourselves, or they position us, as being at the premium end of the market.

MW: What are your biggest challenges?

JM: That customisation and personalisation are our strengths but it’s equally our weakness and our biggest challenge [because it takes time and effort to personalise several garments]. We are doing thousands of units now and 80 per cent of them are unique and personalised with squad numbers, school crests or individual names. My view is the more complex the better because the more complex it is, if we can crack the code, it makes it more difficult for other people to follow and blow us away.

MW: What marketing tools do you use to promote PlayerLayer?

JM: Social media. We get in there via word of mouth and once we are in, it’s the social media that creates the ‘cool’. We don’t do any other kind of marketing, TV, billboards or magazine advertising. Social media is it really.

MW: What do you see as the biggest driver of sales for the business?

JM: Again it’s social media. It’s great because, just like with the IT systems, we can compete with the big boys. We couldn’t compete with these global brands on a TV campaign, we haven’t got the money, but if we can get a cool YouTube video moving, it doesn’t cost as much, it’s about the ideas and the creativity.

MW: You worked at Levi’s for almost 20 years, leaving as its European president. How has that helped in your role as chairman of PlayerLayer?

JM: The principles are the same. The abiding thing to learn was that you have to have a good product. Ultimately, a pair of Levi’s 501 jeans could be knocked off stitch for stitch and other people had identical product, so the rampant success was not driven by the product after a certain point. It was driven by the emotional value-added stuff that came from the brand and the history of the product. We have to respect where we come from. The brand is everything and we must not put our foot in it and do something that jars with what our brand is about.

MW: What have you learned from starting your own business?

JM: Something I didn’t learn from any of my other experiences: that there is this other part of the business apart from marketing. Marketing is sprinkling the star dust on top and a lot of the marketing people would say it’s 80 per cent about the ideas. That may be so but it’s also 80 per cent about the execution and it’s no good having the sparkle if you don’t execute.

I learned that because the other companies I worked for were 100 years old, they had established human processes backed by IT.
We didn’t initially here but I quickly learned that we had to.

We’ve invested over half a million in systems such as Sales Cloud. I didn’t realise the need for that until things started going wrong with PlayerLayer at the beginning when we were using multiple Excel files to manage data and didn’t have a holistic view of the business. We have to put the human processes in place. We spend more on the processes and the ‘boring side’ than we do on the star dust sprinkling side.

MW: What do you feel makes a successful start-up business?

JM: Small companies, wake up: you don’t need to be fearful of the big guys. You have to have a great idea, that goes without saying, then I think it’s recognising all the new technology and mediums of communication that have completely changed the rules of the game.

On the financing side, you don’t need to be a big name either: with an established idea and three years of consistent growth behind you to raise money, you can crowdsource it. With crowd sourcing you can raise a million pounds just like the big guys can.