©inkdrop via Canva.com | Credit: Zulily
Zulily, once valued at approximately $9 billion, last week moved to shutter operations about two weeks after filing a lawsuit against Amazon, accusing the e-commerce giant of price fixing.
The Seattle-based online retailer of children’s and women’s apparel, founded by former Blue Nile executives in 2010, blamed “the challenging business environment” for its closure without citing specifics.
Zulily peaked around the time of its multibillion-dollar IPO in 2013. According to its IPO filing, Zulily launched with “the goal of revolutionizing the way moms shop,” as mobile shopping was just starting to take off. Partnering with smaller and emerging vendors, the platform offered a limited number of daily deals and flash sales.
Co-founder Mark Vadon recently told GeekWire that shoppers loved that kind of experience and came back day after day to find new items. He said, “They were getting entertainment out of the act of shopping itself. Not many companies were doing that.”
Zulily also stood out for taking customer orders before purchasing inventory from vendors, supporting an expansive offering for customers and open-to-buy opportunities for vendors. Zulily said in its IPO prospectus, “Our large and growing customer base in a highly desirable demographic has allowed us to attract and retain vendors offering high quality and unique products.”
By 2015, QVC-parent Qurate acquired Zulily at a discount to its IPO price as competition for customers and inventory in the flash space arrived from Rue La La and Gilt as well as mainstream retailers such as Walmart and Amazon. In recent years, Qurate has attributed Zulily’s challenges to reduced availability of products from national brands, escalating online marketing costs, and reduced marketing spend. This past May, Zulily was sold to Regent, a Los Angeles-based investment firm.
Reports covering Zulily’s collapse also cited the arrival of Chinese fast-fashion retailers like SHEIN and Temu for Zulily’s recent struggles.
In Zulily’s recent lawsuit, Amazon is charged with coercing vendors to “artificially raise Zulily prices at or above Amazon’s, and to punish any sellers who cheated,” preventing Zulily from competing against similar products on Amazon. The allegations mirror those from the FTC’s ongoing antitrust lawsuit filed against Amazon. Amazon has disputed the allegations.
Speaking to FOX 13 Seattle, Anna Fuller, founder and CEO of Halo, a startup offering weekly flash deals for new moms, said that while Zulily was a pioneer, it wasn’t able to keep up with advances in mobile shopping. She said, “They changed ownership several times. They’ve changed their focus a couple of times. It’s not on the radar of the millennial mom in the same way that it was 10 years ago, I can tell you that.