What You Need to Know

• Step One is expanding into physical retail: The bamboo underwear brand has launched in-store at UK retailer John Lewis, marking its first move into bricks-and-mortar retail.
• UK is the priority market where it sees strong growth potential and an aggressive push is planned over the next 12 months.
• But an Amazon sales surge has also hit: Revenue from Amazon grew 28 per cent year-on-year to $3.5 million, now making up 7.3 per cent of total income.
• With current growth rates, Step One is projected to hit an annualised revenue of $100 million within the next year. That's a revenue per employee result of over $7m.
• With such a small team though, everyone is wearing multiple hats, with a focus on efficiency and high-impact roles.
• Head of Engineering and CRO, Hani Rifai describes his relationship with platform provider Klaviyo as an arms race: Step One is one of the first users of Klaviyo’s new B2C CRM, leveraging it to unify customer data, improve segmentation, and enhance marketing automation.
• The fresh CRM integration provides a single view of customer activity, streamlining reorders, personalisation, and analytics.
• The company is building a data warehouse to integrate paid media, email marketing, and customer data for smarter decision-making and refined marketing strategies.

Step One is stepping up. The bamboo underwear disruptor has cracked the UK high street, launching in-store at John Lewis as it pushes deeper into omnichannel retail. It’s a big move for a company that started by solving chafing for guys with big thighs. But with Amazon sales surging 28 per cent, a lean 50-person team driving towards a $100 million run rate, and a data-powered marketing engine running on Klaviyo’s new B2C CRM, Step One is playing for scale. And the UK is the battleground.

According to Hani Rifai, Head of Engineering & CRO, the UK in-store assault launched two weeks ago, as the first foray into real physical retail.

In its most recent financial filing on the ASX, Step One said it expanded its partnership with leading UK national fashion retailer, John Lewis, through its physical in-store launch post period end, in February 2025. John Lewis, known for its quality products and strong customer service, has a large and loyal member base, aligning well with Step One’s values, the company stated.

Releasing the financial results which saw revenues up 6.8 per cent and EBITDA up 10.4 per cent despite a tough retail environment, Step One CEO Greg Taylor described the outcome as a "resilient result," having delivered double-digit earnings growth alongside a clutch of strategic initiatives.

"While customer acquisition softened, strong retention rates and increased order values underscore the effectiveness of our strategy. The resilience we displayed in delivering this performance in the first half of FY25, despite a challenging retail environment, reflects the strength of Step One’s core product, our ability to market efficiently, our success in building and retaining a loyal customer base, and the value of our profitable growth strategy," he said.

According to Taylor, Step One's agility and direct marketing smarts let it move fast on pricing and promos, winning over value-conscious shoppers in a tough market. Sales stayed strong—though at the cost of some gross margin, he conceded — which is still a hefty 78 per cent. The game now, according to the firm's founder? Balancing growth with profit while staying nimble.

“Additionally, we laid the foundation for future growth through the strategic expansion of our women’s range, which offers significant upside across all SKUs because of the value our female customers bring as they’re often buying for the men in their lives. A major part of our focus is to ensure this growth continues to compound. We’ve seen great results in Australia and look forward to driving this success across other geographies."

Rifai meanwhile told Mi3 the firm's UK expansion is its number one priority. On the John Lewis relationship he said, "That'll be a real big growth mechanism for us, even from a brand awareness perspective".

"We have a really good business over there, and it does really well. But we think we can do a pretty big push into growing that over the next 12 months."

For a long time, the business has operated exclusively as a direct-to-consumer model. "In the last year, we've started listing on a number of other channels. We've been growing on Amazon," said Rifai.

Indeed, according to the ASX filing, revenue from Amazon grew 28 per cent year-on-year to $3.5 million up from $2.7 million for H1 last year to now represent 7.3 per cent of total income. The company said it believes in addition to contributing to revenue growth, its presence on the platform enhanced Step One’s credibility and market reach in the UK and US.

"We've also just listed on The Iconic recently but we are primarily a digital play," Rifai said.

Maiden Century

Given its current run rate, and assuming growth continues at least at current rates, Step One is on track to crack annualised revenues of $100m in the next year. That's bad news for bamboo plants but a pretty stunning achievement for the team of 50 employees.

"We are a pretty tight-knit team and we pretty all wear a bunch of different hats. And given the amount of revenue we do, we are all pretty high impact," Rifai said.

Rifai's personal responsibility covers everything from engineering to data warehousing, and infrastructure. He calls it, "All that good stuff". "Then there is the conversion rate optimisation piece as well. Anything to do with website optimisation, customer journey, and so on," he said.

A software developer by trade, Rifai also has a strong pedigree in marketing and marketing technology. "I want my marketing team to be quants. And I want my data guys to know about marketing and creative."

No more chafing

Step One began in 2017 as a bamboo underwear company. You read that right. The initial product was bamboo boxers for men.

"[Greg Taylor, founder] started the company because he had big thighs and they were constantly chafing," said Rifai. "We are now in North America, the UK and Europe.

“Part of that growth journey has involved expanding the product line to sports products, into long johns, etc. In the last few years, we've introduced a women's range, which is growing very, very strongly. The women's underwear market is five times that of the men's game.

"But our really big focus is our expansion into the UK. We just think of opportunity there. They get our cheeky brand voice,  and we're really looking forward to that expansion.”

Thanks to the broader product lines, Step One has a much wider, mass market demographic. "Everyone needs underwear, And we really think that we've got an amazing product," Rifai said.

The data suggests customers agree, with a 69 per cent return rate according to the company's most recent investor pack.
 

Arms race

Rifai further attributed its success to date - and its expectations of future success - in part to the relationship with customer experience platform Klaviyo, which recently released what it claims is the world's first B2C CRM. Step One has been using Klaviyo since Taylor founded the business, meaning the pair have been around about the same time.

"It’s like we are in an arms race with them," Rifai commented. “Our business will grow, and we need new functionality, then Klaviyo needs to meet us there, and delivers us something awesome. Then we utilise that new complexity and that new set of capabilities, and we keep going. The really great thing here is that we're scaling super crazy. We have great growth, we're super profitable, and we're just finding better and better ways within the new feature set Klaviyo has given us to get even better at talking to customers, even better at understanding what they want, even better at scaling."

Differences of scale

Step One is one of the first users of the new Klaviyo B2C CRM, and switched it on a few weeks prior to our interview.

Mi3 Australia spoke with Klaviyo managing director and VP, APAC, Suzy Nicoletti just prior to the release of the B2C CRM, which the vendor claims is the first of its kind, to better understand how a B2C CRM differs from a traditional platform.

"The biggest differentiator is scale," said Nicoletti. "In B2B, it is very process-heavy, very manual, slow-moving, long sales cycles. In B2C, there are literally millions of transactions and pieces of information changing hands every day. What we found [in B2C] is that there are too many interactions generating far more data than the CRMs in existence can keep up with."

Nicoletti offered dental brand Hismile as another example. "Hismile has 8 million customers, six different geographies and websites, lots of different colours, and types of toothpaste. We've got to find out how to talk to all those audiences in real-time. So the biggest thing we're solving for is that scale. And we have technology that is built for it, and it's able to effectively operate at the speed required," she said.

Rifai certainly seems optimistic, at least on initial experience with the platform. Step One's customers are set to benefit significantly from the platform upgrade, he believed.

"If you take the beta announcements, it's like they're pumping a rocket ship, " he said. "Now in our product, customers have a single pane of glass for their accounts, and for their product recommendations, for what they previously viewed, favourites, their wishlist. We get analytics off the back of that, and it all goes into Klaviyo CDP."

It is not disjointed either, Rifai continued. "I don’t have to do the integrations with other systems because Klaviyo is the full end-to-end pipeline. When a customer goes and views a product, all the parts of the platform know. My CRM knows, my CDP knows, and my email marketing knows.  I can start getting some really awesome ways to segment people based on interactions and how they engage."

While Klaviyo's platform does not offer full customer services functionality, it uses an AI Agent to triage a service request, then palms it off to a ticketing system.

Rifai is especially impressed with the payoff from having all data available in a single platform. Previously, the business would have had to do the integrations itself. So while the customers get a more stitched-together experience, Step One gets much better access and visibility to data.

“You can view your orders. You can view all your previous orders. You can reorder at a glance. It serves you product recommendations and if you have recently viewed it, you can add it directly to your cart. Pretty soon it will fully integrate loyalty and rewards in there," he said.

The retailer can also now gather all customer engagement data from the CRM and CDP, allowing it to make smarter decisions about segmentation, and to know the best time to reach out, the most relevant products for each customer, and the most effective ways to engage with them.

"If we reduce a customer's time to order and a customer's time to get a resolution, then we have happier customers who want to buy more products. If I can reduce the number of clicks to reorder from four to one, more people will reorder," Rifai said.

And Step One gets more fuel for its data marketing engine. "We can start playing with much more specific segmentation data for different events."

The company is currently building a data warehouse so it can aggregate all of its data into one place.

"We scan start taking all this data mixing with our paid media data and our email data etc, and we can make some really, really smart decisions off the back of that," Rifai added.