How This Australian Start-up Turned a Disaster Into a Selling Point


One major drawback helped this start-up make lemonade.

pagan_16082604042Allowing your products to be sold for only five days each month isn’t exactly a tried-and-true sales model. But for watch company The 5TH, it has come to be their – extremely successful – point of difference. When the brand, named for New York City’s iconic Fifth Avenue, experienced unexpected stock issues during its first month of business, it was forced to create a stopgap to catch up with demand.

“We ran out of stock of some styles in one to two days,” says co-founder and director Alex McBride. “We decided we should pull everything and wait until we had the other styles in stock. We were planning on keeping the business model for a few months, but it became a crucial point to our business.”

Since their 2014 debut, The 5TH’s simple unisex products have been in high demand. Customers sign up to a waiting list, and are sent an access code to purchase products from the fifth of every month for just five days. Although the watches retail from only AU$129, the limited availability creates a unique customer experience and a feeling of exclusivity that has maintained momentum more than two years down the line.

It’s a strategy backed up by science, with research having shown that our brains associate scarcity with perceived value. And in a world where you can buy almost anything online and have it delivered directly to your door in a matter of days or even hours, this approach is ultimately The 5TH’s largest selling point.

The model also changes how staff work the rest of the month, too, as they are encouraged to offer their input at different stages of the production and selling cycle. “It has been a real blessing to have [this unique approach]. Now our team focuses through the month on working with the right people, awesome content… it’s great to see it play out that way. It’s turned [a problem] into a positive,” says Alex, adding that the company works with a number of designers around the world to create new designs for each range, but provides clear guidelines to keep the brand’s signature style on-point.

After he and co-founder Gretta van Riel started the brand, Alex took about six months to develop the products and cultivate a database of 6000, as well as 70,000 Instagram followers, before launching on December 5, 2014. “I originally had a design blog and was trying to sell products on it,” says Alex. “Nothing really stuck and I found it quite hard to push a message and associate a product to the message. It was the early days of Instagram when things were kicking off, so we started building an audience, and it went crazy.”

On that first day, The 5TH did AU$100,000 in sales. Exactly one year later, the company increased their revenue tenfold, bringing in a total of AU$1 million in sales on December 5, 2015 (yes, in one day). Alex, who still drives the product design and collaborative partnerships, has now put his blog aside. The 5TH has a 270,000-strong database, distributes to 75 countries and its Melbourne-based team has grown to 12. “We’ve had a fast-paced year where we’re going with the flow,” he says. “We were really trying to discover who we are and what we are about.”


The company places a huge emphasis on relationships – Alex’s brother is The 5TH’s general manager, and his cousins and friends make up much of the remaining team. He jokes that with family, “You can boss them around a little bit more,” and says those pre-existing relationships have resulted in a “super committed” team that works collaboratively on major problems, and a fun environment.

“We’ve had supplier problems, distribution problems, accounting problems,” says Alex. “Part of business is working out how to deal with those problems. We’re a young but good team and committed to what we are doing. We have a free-flowing way of working; we brainstorm to try and solve things. We aim to adapt as we move.” Cultivating the brand’s strong audience continues to be the key to The 5TH’s success – especially considering there can be up to 26 days a month where fans of the brand are unable to make any sort of purchase.

To remain in its customers’ consciousness, The 5TH has previously undertaken retargeting campaigns using AdRoll across the web and on Facebook to promote to people who have visited the site in the past. It’s a strategy that paid off – after bringing AdRoll on board they hit 2000 conversions a month, the return on investment was greater than a factor of 10, and the cost per acquisition (CPA) was only AU$1.66.Yet Instagram, where the brand now has 442,000 followers, remains its core platform.
“We’re one of those businesses that is born inside the matrix of Instagram. It’s part of our business of connecting with our audience. As we mature, we have to not be so single-channel-focused, having different touch points with different people. Even on Instagram, we can find  different demographics. It’s all about sticking to who you are, but allowing other audiences to identify what you’re about.”

The start-up is also focusing on collaborations. It recently had a pop-up store at Tokyobike in New York and has collaborated with Melbourne stationery company MiGOALS.

“It’s about connecting with creative people and getting inspiration from them. I’m off to New York next week, [looking for] brands of a similar size to collaborate with. We like to facilitate creativity,” says Alex. “The more we can do that, the more we can stay ahead of trends.”

Sophie Hull



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