Nau, a fledgling US retailer of high-performance outdoor apparel, does everything backward. It designed its web site before building a single store; it encourages customers to buy less; and it markets by not talking about itself. Although it remains to be seen whether this experiment in retailing will succeed, Nau’s CEO, Chris Van Dyke, offers some intriguing ideas about how to engage a generation of customers who are comfortable shopping online and know their way around an annual report. 

Nau takes a contrarian approach to several aspects of retailing. For instance, your four stores—and the 20 planned for next year—are half the size of a typical apparel store. Why?

Most retailers start off with tangible stores and then try to mimic the in-store shopping experience on the Web. That’s fine if you think of online shopping as just another marketing tool. But even though many of us at Nau come from decades of experience in big companies—I was at Nike and Patagonia—we designed our business from the opposite direction, aiming it at today’s customers, who are completely at ease shopping online.

We created a Web experience, and then, because shoppers can’t adequately appreciate the quality of clothing online, we created stores. Customers can come in and touch the fabric, try the garments on, and look at colors. But in many ways it’s essentially an online experience. You go to a computer screen in the store and place an order, just as if you were sitting at home. And we give in-store shoppers a discount and free shipping to encourage them to have purchases sent to them. Customers can buy directly from the stores, but more than half elect to have their items shipped, even though, traditionally, immediate gratification is why people go into stores. 

Is the ship-to-home approach meant mainly to save money on in-store inventory management?

Not at all. We believe our success will come from generating deep loyalty among customers, and we do that by appealing to them on many levels. We have great products that perform beautifully. But the products are embedded in an experience that reflects the way people like to shop nowadays—it has the convenience and choices that online shopping offers.

And that experience is embedded within a corporate philosophy of personal responsibility toward society and the environment. Sustainability and social responsibility are important aspects of Nau. Our philosophy allows customers to be part of an active community and fulfills their desire to do the right thing for people and the planet.                 

Your company represents a high-risk bet on an unproven model. But could a mainstream retailer—Gap, for instance—learn anything from Nau?

Nau appeals to a somewhat rarefied demographic, but any company can benefit from authenticity. It provides a distinct brand-building advantage. Authenticity doesn’t mean touting your donations to humanitarian causes. In our case, it means being aligned with personal responsibility on all levels. Many people in our customers’ demographic—and more and more in all demographics—care about how a business operates and can figure out which business practices are only cosmetic.

Authenticity means that if a customer decides to peel back a layer and look at, say, an annual report or a news article, everything supports the company’s stated philosophy. There are no hidden contradictions. For example, we recognize that sustainability is about reducing consumption, so our apparel is designed to be multiseason and multipurpose. We think we can offset each customer’s reduced consumption by attracting more customers who are more loyal. 

How does your marketing enhance a customer’s experience of authenticity?

Months before we ever sold a T-shirt, we introduced ourselves in the blogosphere. We didn’t talk about clothing. We created a dialogue around individual choice in living responsible lives. All of a sudden lots of people were coming to chat. The blog was just a manifestation of a bigger idea, the notion of a dialogue.

The days of throwing one-way ads at customers to build brand relationships are over. That’s true even if you’re selling widgets or pipe fittings. In every business there are elements of design and engineering that customers have a passion for—and they want to express themselves in a dialogue with the company. 

Andrew O’Connell is an associate editor at Harvard Business Review.

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