Retail CEO explains why stores are still relevant as the industry reaches a tipping point

• Monica + Andy is an online baby's clothing store that has two "guideshop" stores where customers can see products and then have them shipped directly to their homes.
• The concept is similar to the one used at men's clothing brand Bonobos, whose founder, Andy Dunn, is chairman of Monica + Andy's board.
• Monica + Andy is part of a small group of digital brands that are showing retailers how to keep brick-and-mortar relevant.

While traditional retailers scramble to shift their focus to e-commerce, a small group of digital brands is headed in the opposite direction.

These so-called "digitally native brands," which predominantly operate online, are all about improving customer experience, and in some cases, that means opening stores.

Monica + Andy, a baby's clothing store that sells products ranging from $28 for a baby bodysuit up to $1,000 for an entire box of newborn essentials, is doing just that.

The founder and CEO, Monica Royer, learned the tricks of the trade from her brother, Andy Dunn, who founded the men's clothing brand Bonobos in 2007. Bonobos grew to become the largest clothing company to get its start on the web and was acquired by Walmart for $310 million earlier this year.

Dunn paved the way for the trend of turning "clicks to bricks"- starting online and then setting up so-called "guideshops" where customers could go and try on clothing and have it shipped home after. The same concept is used at Jack Erwin, a men's shoe company.

"He's a pioneer in what he did," Royer, who's adopted Dunn's model with her own brand, told Business Insider.

She added: "We took their idea of guideshops and made it our own."

Monica + Andy has two stores - one in New York and one in Chicago - and plans to open a third in Los Angeles. The stores serve as a place where customers can come in to "touch and feel" the products, Royer said. If they decide to purchase, the order will be shipped from its distribution center within two days.

The Chicago store has been open since the brand launched. Royer said this is one of the biggest lessons she learned from her brother. When he started out with Bonobos, Dunn was adamant that the brand should only be online, and he now regrets not opening a store sooner, she said.

"They are dynamite customer acquisition tools," Royer said.

But with thousands of store closures announced this year as traditional brick-and-mortar stores flounder and e-commerce encroaches, there is a need to make these stores relevant and innovative.

"Retail as we know it is changing. People are focusing on storefronts not just being billboards, but also bringing that one-to-one experience to customers in a way that hasn't happened in the past," Royer said.

Stephania Stanley PhotographyThe store runs various events for customers, including hosting baby showers.Royer makes the most of her guideshops by offering experiences in store. These vary by location and are tailored to what the brand thinks local customers want. This could include hosting baby showers, storytelling sessions for kids, classes for expectant parents, or the chance to talk to a lactation consultant.

"Experiences give customers a reason to come back," Royer said, adding that she uses them to fill the store in quieter parts of the day.

She said: "The store might not be busy between 1 p.m. to 4 p.m. on a Monday, but there's no reason not to pack it with singing and story time."

By stocking a limited amount of inventory in the store, both Monica + Andy and Bonobos are able to operate in smaller spaces and offer a more curated experience for customers, allowing them to shop the store in minutes.

The plan now is to grow slowly and evolve as their target client, the millennial mother, does, Royer said.

"We want to be that brand that is your new mom and then to introduce you to other mothers," she said. "We want to educate customers, befriend them, and be there for the long run."

NOW WATCH: Here's why this wine costs $16,000 per bottle