From Mall Kiosk to 37 Stores: Behind the Rise of Palmetto MoonSep 20, 2022 05:11PM ● By David Caraviello
For a retailer based in South Carolina looking to take its first steps outside the state, it was a legitimate question: Is the name going to work?
After all, “Palmetto Moon” is steeped in South Carolina lore, taking its name from the two objects featured on the state’s iconic blue and white flag. And it was that pride in all things South Carolina that by 2015 had helped Palmetto Moon make the leap from a mall kiosk that sold largely Clemson and University of South Carolina apparel to an established Southern lifestyle brand with stores throughout its home state.
But as Palmetto Moon eyed a metro Savannah location that would be its first outside the Palmetto State, the name was among the factors the company’s leadership had to evaluate.
“I remember people calling and asking me, ‘This concept is really good in South Carolina — do we have legs outside the state?’” said John Thomas, a longtime board member at Palmetto Moon who was named CEO in 2021. “I think with the success of opening the store in Pooler, it gave everyone a level of confidence that, OK, we have a concept that does have legs.”
The 2015 opening of the store in Pooler, Georgia, showed how, with some location-specific tailoring, the Palmetto Moon concept could work outside of South Carolina. It also kicked off an explosive expansion that with a September ribbon-cutting in Mebane, North Carolina, will see the company grow to 37 stores across six states: South Carolina, Georgia, Florida, Alabama, North Carolina, and Tennessee.
“Once you get out of the state, people don’t necessarily say, ‘Oh, Palmetto Moon, it ties back to the state of South Carolina.’ They think it’s a cool name, it’s a unique name,” said Thomas, who worked for 18 years as an executive for the Charlotte-based department store Belk.
“When you think back to the ’80s and ’90s about how certain specialty stores were developed, Banana Republic started out as a very specific brand with a very specific connotation that evolved and changed over time,” he added. “So for us as a company, the South Carolina connection is always important to us. We’re based here, our corporate offices are here. But what we’ve done is taken the best of what we do as a company, and parlayed that thought process around localization in our new markets.”
A ‘pragmatic’ approach to expansion
Bob Webster was sending his daughter to Clemson, and he was struggling to find apparel connected to the Upstate university. That search gave Webster — also a former Belk executive, who had recruited Thomas to the company — the idea of opening a kiosk in Charleston’s Citadel Mall. It would sell collegiate gear associated with South Carolina universities, and the Rainbow brand flip-flops all the kids seemed to be wearing at the time.
Webster had leased the kiosk just for the final two months of 2002, to coincide with the holiday season. “Three weeks in, even before Thanksgiving, he called me and said, ‘I think I’ve got something here, because we are reordering like crazy,’” Thomas recalled. By that spring, one kiosk had become several linked together, and Webster had added products with the state flag logo. He expanded to a full-fledged storefront at Citadel Mall in 2003, opened a second location in Mount Pleasant the next year, and Palmetto Moon was off and running.
“The key was really something we work on here every day, and that’s really listening to the voice of the customer,” Thomas said. “Charleston customers were coming in and saying, ‘Hey, you should open a store here, you should open a store here.’ So that kind of the organic growth started to take place.”
Palmetto Moon had nine locations in South Carolina before its out-of-state expansion began to ramp up in 2015. Beyond the borders of the Palmetto State, there was some trial-and-error — customers in Tennessee, company executives found, wanted merchandise featuring the “tri-star” logo on the Volunteer State flag. In other places such as Alabama, the state flag didn’t resonate as much as the name of the city or town. And items with the Palmetto Moon logo and wordmark remain best-sellers regardless of the location, Thomas said.
Clearly, the approach has struck a chord with customers throughout the South. Palmetto Moon opened in Commerce, Georgia in late July, added a Franklin, Tennessee, location in early August, and cut the ribbon on Mebane, North Carolina, in September.
When it comes to expansion, “we as a team here have really tried to take a pragmatic approach,” Thomas said. “We do a lot of research, and we listen to our customers. We get a lot of interaction on social media, ‘Hey, when are you coming here?’ Outside our current footprint, we’re getting a lot of requests from contiguous states. So we take all that into account.”
Palmetto Moon’s approach now, Thomas said, is to maximize its brand within its current six-state footprint. Based on state populations, he believes the company has yet-untapped opportunities remaining in North Carolina, Florida, Georgia, and Tennessee. But there are also connecting states in which Palmetto Moon has a high volume of online orders, something the company takes into account when considering its longer-term expansion goals.
“Virginia and Kentucky are two states that are on our radar screen,” Thomas said. “I think there are additional opportunities outside of that, like Louisiana. The Southern aspect of our brand is important, I think we understand the Southern customer. Running a Southern retailer, there are definitely some differences in customer profile and customer lifestyle. If you’re running a national retailer, you might not understand those nuances. I think we’ve done a good job as a company of trying to understand those nuances and fill in those gaps.”
A mix of local and national brands
The college-branded merchandise that gave birth to the Palmetto Moon mall kiosk in 2002 remains a cornerstone of the company’s business. But as it expanded to become more of a lifestyle brand, Palmetto Moon added more items from more companies that meshed with the retailer’s ethos. One of those is Local Boy Outfitters of Columbia, whose apparel line celebrates the outdoors — and features a logo of a dog and the ubiquitous crescent moon.
“We really look for up-and-coming brands that we can partner with and grow with,” Thomas said. “Local Boy is a great example — they’ve become an important brand for us across our footprint.”
Each Palmetto Moon also aims to stock some unique local products, so visitors can find something in the Myrtle Beach location that they won’t find in Macon, Georgia. There are some products developed by Palmetto Moon itself, along with curated national brands like Vineyard Vines that fit the lifestyle concept behind the company.
“As a merchandising team, we spent a ton of time really trying to identify new and unique products and up-and coming-brands, and then try to piece this merchandising puzzle together to create the Palmetto Moon experience,” Thomas said. “It’s important for us to have a great mix of local products, collegiate products, state products, private brands and national brands.”
The company has weathered some changes on the way from mall kiosk to 37-store retailer. In 2016, founder Bob Webster sold majority interest in the company to the private equity firm Topspin Partners, which offers strategic support but is not involved in Palmetto Moon’s day-to-day operations. When Thomas took the helm in 2021, he became the third CEO in three years as Palmetto Moon tried to fine-tune the company’s direction.
But some things haven’t changed. Listening to the customer remains Palmetto Moon’s overarching credo, and localization the key to its expansion effort. The South Carolina stores still have plenty of Clemson and USC gear. And two decades later, the kids are still wearing those Rainbow flip-flops — which they can still buy at Palmetto Moon.
“They’re still there absolutely,” Thomas said. “They’re one of our best-selling footwear brands.”