Indochino has announced a strategic partnership with national media brand Postmedia. The Vancouver-based made to measure clothing company will receive $40 million CAD in advertising support from the Canadian media outlet over the next five years, in exchange for a portion of its Canadian revenue. In addition, Postmedia will have the option to purchase Indochino stock at current prices.
“We’re boosting our marketing activity to the equivalent of Postmedia’s largest advertisers, whilst at the same time lowering one of our largest expenses,” said Drew Green, CEO of Indochino. “Both sides have a vested interest in making the partnership work, which optimizes the chance of success and greatly reduces risk. It’s a winning formula and one that I hope will pave the way for similar ventures in other markets.”
“This is a great opportunity for two companies to leverage each other’s strengths. We believe it’s a perfect fit.”
– Andrew MacLeod, Postmedia CEO
According to the agreement, Postmedia will promote Indochino’ products to an audience of approximately 13.4 million digital visitors monthly and 8.3 million print readers. Through a variety of channels, digital, print and native advertising, the media network plans to give the retail company access to markets in Toronto, Ottawa, Vancouver, Calgary and Edmonton. With eight showrooms in Canada, and a network that reaches 57 percent of the nation’s C-Suite business executives, the partnership ultimately aims to introduce the clothing brand to new markets within Canada on a larger scale.
Since the partnership between the two companies started in February 2017, Indochino says Canadian net orders are up 63 percent (year over year) and net growth has increased by 77 percent (year over year).
“This is a great opportunity for two companies to leverage each other’s strengths in order to grow their businesses,” said Andrew MacLeod, President and CEO of Postmedia. “We believe it’s a perfect fit.”
The partnership arrangement is not entirely unfamiliar to Green, who gave Torstar a percentage of ownership in his previous company, Shop.ca, for a blend of cash investment and promotional support in 2012. “Torstar has a proven track-record of using its media assets to drive online transactions,” Green said at the time.
Shop.ca filed for bankruptcy protection in June of last year and, unable to pay its creditors, sold to Transformational Capital.