It was in that empty space between high fashion and activewear that Katie Warner Johnson saw opportunity.
She was educated at Harvard, but it was her training and passion in ballet, with that calm sense of grace and beauty, that inspired her to bring a dressed-up style into the world of sport and fitness and co-found the upscale ecommerce store, Carbon38.
At the time, in 2013, activewear wasn’t exactly considered fashion, unless you were all glammed up like Jane Fonda. Activewear was just the stuff you wore to work out in. But Johnson saw a shift in society that came in the years after the 2008 financial crisis, when many women remained the primary caretakers of the family while still fighting in the workplace for gender parity. For moms and for any women in the workforce, that could mean for a very long and diverse day.
“…But that means there are three, four and five shifts that we have every day, and a pencil skirt, pantyhose and stack heels are not going to get us from school drop off to board meeting to red-eye to cocktail hour to client dinner and then home to still be present for our families and our partners,” Johnson said in an interview with the Los Angeles Times. “But you know what could? A pair of leggings.”
When Carbon38 found itself spending valuable time trying to determine whether orders and returns were legitimate or fraudulent, it turned to Signifyd’s Commerce Protection Platform. That freed up the time Carbon38 needed to build the kind of relationships with customers that were core to its mission. It also saw measurable results, including:
- Achieving a 99% approval rate.
- Revenue lift of 3%.
- Reaching 100% order automation.
- Incurring $0 in fraud losses.
The essence of Carbon38’s product is the pairing of fashion and function for everyday wear. Since the store’s launch of “athleisure” eight years ago, Johnson has built a multimillion-dollar business serving half a million customers. She also opened two brick-and-mortar stores, one in Pacific Palisades, California, and the other in Bridgehampton, NewYork.
Carbon38’s Katie Warner Johnson champions women’s business initiatives
Her approach to retail has championed women-led brands and companies that need help with exposure and with gaining the capital needed for success; she’s also partnered with established brands as diverse as Nike and Free People. But through all the challenges that growth brings, from the meager beginnings working out of Johnson’s apartment to the rounds of funding to its present-day success, Carbon38 has never changed focus: It’s been all about the customer — who she is, how to support her, and how to serve her efficiently.
“Just really following (the customer) along her journey and understanding how we can suit her in her day-to-day life,” says Shawn Potter-Bradford, Carbon38’s director of customer care. “Whether that be picking up kids and running around doing the whole soccer mom thing, or going into a business meeting and carrying a nice blazer over a really nice pantsuit. So our space is just really catering to her and helping to empower her in the world.”
In the video interview below, Potter-Bradford talks about how partnering with Signifyd enhanced Carbon38’s strategy of going beyond transactions and actually being there for its customers.
Besides shopping for a quality product, customers want easy ordering, quick delivery and easy returns — which just happen to be all the same services that entice fraudsters.
Manual fraud review was taking Carbon38 away from its customer service mission
To spot and fight fraudulent orders, Potter-Bradford and her customer care team would manually sift through transactions to separate the fraudulent from the legitimate, while still trying to process genuine orders quickly. They also dealt with the full range of chargebacks — including when customers claim that an item was not received when it was. This form of customer abuse took the team even more time to research and rectify, one way or the other.
Moreover, as an apparel retailer, Carbon38 was selling in a vertical with the highest rate of online returns — reaching 25% or more. As more shopping has moved online, return abuse has followed with fraudulent returns making up 10.6% of all online returns last year, according to the National Retail Federation.
All the success of Carbon38 was great, but untangling the fraud and abuse from the good was a lot. So about a year ago, Carbon38 turned to Signifyd’s Commerce Protection Platform. The platform relies on data from millions of daily transactions on Signifyd’s Commerce Network to understand the identity and intent behind every transaction. Its Return Abuse Prevention solution allows retailers to automate their response to refund requests, depending on whether the request presents high, low or medium risk of being fraudulent.
Signifyd’s automated Guaranteed Fraud Protection brought results and made time to connect with customers
Signifyd helped automate Carbon38’s customer experience and it provided a financial guarantee against fraud and chargebacks on approved orders. Potter-Bradford says the improvement in Carbon38’s total operation, and revenue (up 3% with the increased approval rate), has been more than significant.
“In bringing Signifyd on as a partner, we’ve been able to achieve a 99% approval rate (of orders) which has been amazing and helped us to leverage a better customer experience,” says Potter-Bradford. “(Signifyd’s) automatic chargeback recovery takes the worry off of our shoulder. … The process has been so seamless that I don’t even have to look at a chargeback. I think in the course of one year I probably only had to look at about two chargebacks myself.
“So for us, customer service starts when you don’t have people calling in, but when everybody has what they need online, and then you’re reaching out to them. So Signifyd has really allowed us to focus on really caring for our customers and kind of realigning our processes to ensure that we can have that personal connection with each of them.”
This year, on March 8, Carbon38 announced its next phase. It rebranded with a new logo and website experience, and Johnson pointed out that this launch happened on their secret holiday, 3/8, the date she says is hidden in their name.
“I’ve always loved chemistry as a subject and was thoroughly enthralled by the periodic table,” Johnson says. “I knew I needed a name to encompass all the unforeseen that was to come. As carbon is one of the most abundant elements in our bodies, it felt compelling for the business I was beginning to create. I added on a number sequence, and our name was born.”
Carbon38 got off to a fast start and hasn’t looked back
The reason Johnson chose the date of March 8 to add to the company name isn’t clear. But from the very beginning, when racks of inventory were stacked in plastic bins in her dining room, Johnson had reason to be encouraged: Carbon38 made $50,000 in its first month, according to the LA Times story.
“Right now Carbon38 is going through a huge transition, both in growth and revenue and we’re really digging in to understand who our customer is as we move into the remainder of this year and into next year,” Potter-Bradford says. “We plan to leverage the partnership with Signifyd to help us to protect our customers and protect our losses as well.
“…With fraud, it’s ever-changing. And it’s moving fast, and it seems like as soon as you get caught up, it catches up. So it feels good to have a partner that is knowledgeable in that industry and that you can trust as we move forward.”
Photo courtesy of Carbon38
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