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Soho House looks like a members club, swims like a members club and quacks like a members club: “From the beginning, and throughout our 25-year history, our members have always been at the heart of everything we do.†But Soho House isn’t really a members club at all.
A genuine members club is owned and operated by its members, who take every decision from the makeup of the membership. In stark contrast, the 127,800 members of Soho House (and its satellite entities) are at the mercy of Membership Collective Group Inc — “a global membership platform of physical and digital spaces†— which in June floated on the New York Stock Exchange.
Soho House is not alone: Any number of private hospitality enterprises masquerade as members clubs. The Membership Collective Group has taken the legerdemain to new lows with an IPO deploying a dual-class share structure that gives the company’s three main owners a veto over key decisions and board appointments.
A publicly traded private club is not just oxymoronic, it’s a tough business bet: Can you elongate the elastic of exclusivity without it snapping back in your face?
From its boho Britpop beginnings in London’s West End catering to “world class writers, artists, performers, directors, founders, designers and producers,†Soho House has rapidly expanded its global reach — opening 12 new houses since 2018, planning an additional 16 by 2024 (taking the total to 46) and predicting long-term growth of five to seven new houses a year. Simultaneously the club has extended its brand grasp with various membership-lite gambits (Soho Friends, Cities Without Houses) and commercial extensions, including Soho Home (buy the club’s design), Cowshed (spa products) and Soho Works (a WeWork me-too).
So far, even in a pandemic, so good: the Soho House waitlist currently stands at an all-time high of 63,700.
But the risk is that Soho House becomes a pyramid scheme of cool which must endlessly entice new members (to satisfy shareholder demands), without diluting its founding myth (and killing the golden goose). Can Soho House — which has never posted a profit in 25 years — unsphinx the riddle of exclusive expansion?
In many ways, Soho House is the poster-child of “brandlonging†— the strategy of ensorcelling consumers with bonds of belonging that blur the lines of trade.
Brandlonging isn’t new. For well over a century companies have sought to entwine loyalty and identity with a host of gimmicks — from copper tokens, box tops and bottle caps to trading stamps, cigarette cards and fan clubs.
But as branding becomes ever-more immersive, and technology ever-more
pervasive, so brandlonging has become ever-more
sophisticated.
—Bloomberg