New DTC toolkit   //   April 22, 2024

How period underwear brand Knix is mapping out its growth strategy post-acquisition

As more startup brands exit, they are mapping out their future growth strategies under new parent companies. 

One of these is period underwear brand Knix, which sold a majority stake to health and hygiene product company Essity in September 2022 for $320 million. Before the sale, the company had raised around $40 million in funding. In 2022 Knix’s sales reached $170 million, a 70% growth over the previous year. Since its acquisition, Knix has grown by double-digits, and the company says it now has more than 3 million customers. That’s up from 2 million at the time of its acquisition.

At the time of the Essity acquisition, Knix was not looking to sell but founder Joanna Griffiths already had an established relationship with the Swedish company. “It wasn’t about selling the company, but finding partners with similar values to work with on the same long-term path,” she said.

Now, two years after the acquisition, the brand is ready to make some big changes — with the help of its parent company. For the past 18 months, Knix has focused on laying a foundation for its future product pipeline and revamped wholesale strategy. With this, the company has expanded its assortment and invested in more stores. Griffiths, who still owns 20% of the company, said the brand has been able to find a balance between operating with agility and working closely with its parent company on investing in long-term growth.

Operating under an established parent company doesn’t always work out for DTC brands that are used to making quick, nimble decisions. Kimberly-Clark, for example, acquired a majority stake in the period underwear brand Thinx in 2022. While the company has grown its wholesale presence since then, Thinx announced major layoffs earlier this year — and employees told The Cut that they feared the parent company would ultimately shut the brand down.

But, Griffiths said, “It’s been a really good partnership for us,” with the parent company supporting Knix’s long-term expansion plans which include investing heavily into product development like swimwear and shapewear. The acquisition also allowed Knix to hire more executives recently, Griffiths said. Some of these roles include sales and finance positions. 

Knix launched in 2013 as a wholesale business. Then, in 2016, Griffiths moved to a direct-to-consumer model. According to Griffiths, she quickly learned that selling a large number of SKUs in extended sizes was difficult to do at traditional retailers.

Since the pivot, the company remained DTC-only and occasionally held pop-ups, such as a Nordstrom partnership in 2019. That year, the Toronto-based company also opened its first standalone stores in Toronto and Vancouver. This year, Knix is going back to its roots and is ready to dip back into wholesale partnerships, beginning with Canadian retailer Sporting Life.

“Now we’re repositioning the brand that’s here for people every single day of the month, for every activity and life stage,” Griffiths said. With this, the company is both expanding its product lines and investing in retail.

Knix’s product expansion

Knix’s product focus is on intimates — it now sells everything from underwear to bras to swimwear. One major initiative for Knix has been expanding its bra business based on customer feedback. After two years of redesign, the company released its best-selling WingWoman wireless bra with 99 sizes, extended band sizes and features like extra side coverage. The company is also expanding its Ultrathin intimates line, most recently releasing a no-show underwear style in March.

For the releases, the company also debuted its Knix for Life campaign starring actress Gabrielle Union, who came on as Knix’s global brand ambassador.  

With Knix’s intimates being thin and feeling like regular underwear, Griffiths said the company is working toward helping customers replace the majority of their intimates with Knix products. This is why Knix is continuously growing the assortment with new tops and bottoms, Griffiths said. “The long-term way for this category to win is to be more ubiquitous with regular underwear, and something you’d shop for in a similar way,” she said. 

The challenge lies in designing leakproof intimates and apparel that can compete with regular versions of the style by other brands, Griffith said. However, these R&D investments are a foundation to expand on in the future. 

Knix’s offerings include an activewear line that comes with or without leakproof and nursing bras. “There is a common thread where we’re taking the innovation and applying it to more categories,” Griffiths said.

“We’ve also been leaning into swim,” she said, which was one of the top requested products from Knix customers when it launched in spring 2023. The teen swim line in particular has been performing well, Griffiths said, with some existing customers buying it for their tween or teen. Currently, about 90% of the swim styles have a leakproof version. 

Investing in stores

Knix is also investing in its store fleet. Though retail is a capital-intensive undertaking, the brand sees its stores as an acquisition tool for customers who’d rather try the product on in-store.

“Last year we opened six new stores,” Griffiths said, bringing the location count to 14. Currently, digital sales make up the majority of overall sales for the brand followed by Knix’s retail stores.

Griffiths said that expanding distribution in the period category can be tricky, and Knix is being selective with the types of retailers its products are sold. She added that other players have worked on showing up in drugstore chains, or the menstrual hygiene aisles in big box stores. Startup competitors like Saalt and Thinx, which was acquired by Kimberly-Clark in 2022 for an undisclosed sum, have gone this route.  

Now, under the ownership of Essity, Knix is also getting back into wholesale, this week announcing a shop-in-shop partnership with Canadian retailer Sporting Life.

The brand also launched an Amazon store last year, which carries a selection of Knix’s top sellers. Thus far, Griffiths said, Amazon has been a successful play for removing the friction for customers trying the product for the first time. While data visibility is limited on the marketplace, Griffiths said “we see 90% of our orders are first-time customers of Knix on Amazon, so it’s a good acquisition channel for us.” 

Ben Cogan, co-founder of DTC aggregator Agora Brands, said selling a majority stake to a big company can be an advantage for startups, especially amid the current challenges, like limited capital and higher marketing costs.

“If you could sell a business, not only is it less scary as a founder but the resources of the parent company allow you to take risks,” Cogan said. This could include expanding product lines or adding new retail partners.

For Knix, having the backing of a parent company has allowed the brand to make bigger business moves.

Griffiths said Knix plans to continue investing in these new third-party channels to help the brand reach new customers. At the same time, product innovation will remain a big focus. “The past year for us has been about reinventing our core categories and leveling up our leakproof technology,” she said.