Listen to an in-depth interview with Kerry Bennett, director of marketing communications for Hautelook.com. See the RetailWire Podcast below...
Social sales, flash sales, sample sales - a new breed of websites offering discounted merchandise for a limited time only are taking off and among the most popular is HauteLook.com, which has attracted over two million members in the U.S. and Canada since it first launched in September 2007.
HauteLook partners with
brands in a variety of product categories allowing the designers to select
both the merchandise and pricing of items sold. The retailer handles fulfillment
for all orders with a warehouse positioned on both coasts to expedite orders.
"Unlike some other competitors in this space, we typically don't buy the merchandise up front," said Kerry Bennett, director of marketing communications for HauteLook. "So we partner with them (brands) every step of the way, from deciding when their event is going to be, what inventory is going to be available, what sizes and what amount. We produce the event in-house entirely. They get approval over it, and then -- while the event is going on -- they get clear visibility into all the metrics of the sale. At the end we place an order with the brand for just what's sold."
Ms. Bennett said the site's merchandise falls under the "casual chic" tent.
"It's that kind of style we are really trying to cultivate," she said. "It's very real world; it's very wearable. When it comes to your home, it's very accessible and that's something that members really respond to on our site. It's finding these brands that they know but also finding brands that they don't know that fits into this style."
Meeting the needs of its members has led HauteLook into new product categories.
"We started with women's apparel and accessories and that's certainly a very core business for us, but we've expanded pretty quickly into men's, into kid's, into beauty, which is a huge business for us. Also, into home. We've had Omaha Steaks on the site a few times, and people love them," said Ms. Bennett.
"We've just had our first event with Exhale Spas, which is a chain of spas and fitness centers in the country and that did really well for us -- more of an experiential thing. I think we will probably explore that as well," she added.
The site's rapid growth has taken the company somewhat by surprise. "We literally did not have a marketing department six months ago, so it was really a business built on word of mouth," said Ms. Bennett. "We had over a million members before we started marketing, and even today 60 percent of our buyers are coming from either direct referrals, directly from the site or word of mouth from members. So really, the virality of the business was not something that you typically see so quickly in retail. It's something that really took off and we continue to be really, just thrilled by."
Discussion Questions: Why do you think flash sales sites appear to be catching on so quickly with consumers? What do you think about HauteLook.com's business model? Will we see mainstream retailers start to move aggressively into this space in the near future?