Home Essentials that you might not Snowe about, yetBy Abigail Albright
Accessible, Luxury Home Essentials that You Might not Snowe about, Yet
Snowe is a lifestyle, direct to consumer home essentials brand with luxury-quality goods at accessible prices.
Andres Modak and Rache Cohen believe existing home-focused brands no longer resonate with modern-day consumers. They think you should be able to furnish your home with high quality, stylish goods at affordable prices. They also believe that you will value being able to trust a brand to curate items that are consistent in design, functionality, resilience and usability, and that you value this curation over having endless choices.
Founded by Wharton alumni and real-life couple, Andres Modak and Rachel Cohen, Snowe continues to make waves in the home essentials market.
I sat down with Andres Modak to discuss the company journey and their vision to create a better consumer experiences for the home.
The Snowe story officially starts in 2013, but the story really begins in 2010, when co-Founders Rachel and Andres met as first-year students at Wharton. Andres and Rachel discovered that they both had a love of design. Over the next two years, they would become a couple, graduate from Wharton, and move to NYC to build a life together. This journey included setting up a home together.
This is when the couple encountered a less than stellar experience. They found that the “price-value equation was broken,” according to Andres. They faced decisions such as choosing between an inexpensive sheet set that would likely wear out in a year or a luxury sheet set that could be $600 or more. Beyond the bedroom, affordable home essentials were of poor design, while the higher quality, luxury items, to which they were drawn, were out of their budget.
Additionally, the shopping experience itself was painful. Online aggregators, such as Wayfair, offered a time-consuming, overwhelming experience with an endless supply of items. And, of course, there was always BBB, the big-box-bewilderment experience of trying to find the perfect item in brick and mortar stores with products stacked floor-to-ceiling.
Where were the brands that “resonated with millennially-minded people like themselves?”, they asked. Where were the brands that reflected the way they lived their lives, which according to Andres, was “focused on fewer, better things, that lasted.”
Andres and Rachel took advantage of that gap in the market and established Snowe.
Andres Modak and Rachel Cohen, Co-Founders, Snowe
Not Decor, but “De Core”
They decided to launch a digitally-native brand to offer high-quality, luxury home items that were affordable and durable. Yet they wondered where to start.
The home is filled with items across many categories including accessories, bedding, homewares and furniture. Digitally native vertical brands (“DNVB”) have proliferated in recent years. Compared to traditional retailers, they benefit from improved vertical integration and the ability to gather more data and insights into their customers’ shopping preferences.
However, Andres and Rachel did not fully take that approach. They had the insight that Snowe could build a relationship with customers beyond a one-time, single-product purchase. Instead, they decided to focus on the essential categories – EAT, DRINK, SLEEP, and BATHE – all things you (hopefully) do every day.
Importantly, these are also the first things you buy when furnishing your home. By establishing a one-stop destination to find the complete set of affordable home essentials, Snowe allows you to not only purchase items in bundles, but also add specific items over time. Andres describes these purchases as “relatively considered”, in that people may think about these purchases for a bit before buying and they are core to living. From a business model perspective, this destination site extends the lifetime value of a customer and reduces the relative cost of customer acquisition.
Thus, when Snowe officially launched in 2015, it offered over 100 products for the home.
Some of the many home essentials that Snowe offers.
Today, you could go to Snowe to find European-made percale sheet sets for about $200. Equivalent sets elsewhere still carry that $1000 price tag.
Or, one can indulge in French Limoges porcelain dinner plates at a significant value.
Better yet, you can buy a bundle (for example, a “starter kit”) and get even better value on a set of items for the kitchen, bedroom or bath.
Oh, and Snowe does all this while ensuring its products are sustainably- and ethically-made, and toxin-free.
So, how did they fix that price-value equation?
Though Snowe is focused across many product categories, they still maintain a vertically integrated, direct-to-consumer disintermediation model.
Snowe can offer premium products to consumers at much lower cost by internally sourcing the highest quality materials, partnering directly with high-end factories, and selling products through their website. They cut out middlemen and pass these savings through to their customers.
With costs minimized by replicating the popular DNVB model, they consulted their Wharton roots to set pricing. With some help from Wharton professors David Bell and Raghu Iyengar, Snowe defined and tested customers’ willingness to pay alongside competitor brands. They’ve achieved a price point that is affordable for customers and provides ample profit margin.
Given their successful online business model, does this mean they won’t offer a physical retail space?
Quite the contrary! Andres and Rachel recognize that establishing a physical presence is important. Given their propensity to question how things can be done better, they have already executed a few experiments to determine the best way to go about it.
First, Snowe tested pop up shops and trunks shows. These temporary stores experienced high traffic, which increased brand awareness and sales.
At the start of 2017, Snowe launched a physical experience called the Whitespace. It was an appointment-only “immersive shoppable loft space” where visitors could experience the brand in a home-like setting.
Shoppable loft experience called “White Space.”
That was a success and led to accolades, such as an Innovation by Design award by Fast Company. But they weren’t finished experimenting. Later in 2017, they opened street-level popup retail space in SOHO. During a three-month trial, they learned important insights about their customers’ and their shopping experiences, which they’ve been able to incorporate into the online experience.
Andres is confident that they will take their recent learnings to ultimately build a physical experience that is tailored to the way contemporary consumers want to shop. After all, he doesn’t want to mimic the same BBB retail experience that led to the company’s inception.
Nice day for a white wedding
How is Snowe growing so quickly with primarily only an online presence? One way is through traditional word of mouth, including stellar product reviews. The other is with wedding registries.
Given Snowe’s products are typical cornerstone items for registries, it made sense to offer this service. Andres identifies that Snowe offers products “you typically buy with a partner, later in life, for your first or even second home.”
Why are registries so special? This is something department stores have known for a long time: registries are fantastic customer acquisition channels. Think about it… both the partners and people invited to a wedding – which in America is an average of 140 people – are exposed to a branded registry through one event. Beyond the exposure, the brand has the endorsement of the glowing couple who plans to use its products as the foundation of their new home. Which leads to perhaps the second-best part of the registry – the loyalty it creates. Guests that purchase through a registry will refresh and replenish these items throughout their life. Registries help lower customer acquisition and increase customer lifetime value. Now, that sounds like a match made in heaven!
Andres and Rachel have built a strong team of investors. These supporters include friends and family, traditional venture capital firms, as well as strategic investors in the retail and home spaces.
While they have experienced strong growth through word of mouth up to this point, last year they began paid acquisition and marketing efforts. Their focus this year is growing the team and expanding the reach of the brand. With $40B of a $220B global homeware market expected to move online by 2020, the timing for Snowe is right.
With the level of customer obsession they already have, this is going to be an exciting journey.