Saturday, April 12, 2008

Online Sample Sales

In the past couple days, i've been invited to two separate invite-only sample sales. Not that I feel special, as they both give credits to the account holder making the referral, but just interesting that both came within 24 hours. The first, Rue La La, launched about a week ago, while the other, The Gilt Groupe launched in September 2007 and is backed by 2 former senior executives at Double-Click. Both focus on bringing one day only samples sales on mid and high-end brands to a mass audience via the internet - John Varvatos, Dolce & Gabbana, Hickey, etc. Aside from the referral fees paid to memebrs once their friends actually buy something, its an interesting model one because many brands could potentially want to access this private sale online (unloanding merch while protecting the brand) and two because marketing costs figure to be pretty low. By keeping the site invite only, marketing fees are reduced drastically. Essentially the only costs now are the referral fees, and email costs to its own private network to announce sales. Both sites promise savings up to 70% off, so it will be an interesting competition to watch over the next few months.

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