VENTE-PRIVEE EVOLUTION

Vente privee was launched in 2001, just after the internet crash. The company operating in internet business was in a stage of stagnation and was forced to seek for the new availabilities to survive. The idea was to sell the clothes from the net. It started from “Weston”, a famous shoe brand. It was a lucky beginning: around 200 people were queuing making a lot of purchases.
This first success gave an idea for the company to grow its market presence through making the deals with the diversified brands, willing to sell on the net.

The cue element of success was partnership with a lot of new brands.

To create an exclusive impression from the site on the clients, the company created a new marketing strategy: any new client can only get an access to the site via the “parrain” (friend).

At the moment the company has … subscribers, more than 200 mln Euros of revenue.
Because of this growth, the company decided to develop its assortment of the products proposed on the site: now besides clothes it proposes wine, plants, products for dog and even cars.

The strength of the company is in anticipating in the needs of the clients.
Last year the company launched the same business in the new markets: in Germany and Spain.

The new opportunities for this business model:
1. Enlarging the sales in the new areas (cars, houses)
2. New market places
3. Developing new creators (designers)
4. Building of community
5. Licencing of the business model and creating a franchising chain worldwide (technology)

Scarlett
Fabrizio

TOP LUXURY BRANDS FIND NEW MARKETS IN INDIA

VENTE PRIVEE BOOM

More and more sites that provide vente privee are emerging on the net. The main principles of their functioning are: selling of the big brands for reduced prices (discounts up to 80%) within the limited amount of time (normally not more than 48 hours, though may be up to 1 week).

For being able to participate in these sales, the person should be invited on the site by his/her friend (parrain), who is already registered on the site.

Normally these sites sell clothes, though while this business model is developing , there are more and more other proposals you can meet : food, wine, products for animals and even cars.

The pionnier of the vente privee system was the site vente-privée.com, which operates since 2001 and is really a leader on this market, with the annual revenue exceeding 200 mln Euros, which is constantly growing.

The huge popularity of these sites (more than 70 in France now) is explained by the business-model, which is very lucrative. The system of vente privee is attractive for company itself, for luxury suppliers, and, of course, for customers.

Luxury suppliers benefit from the possibility to sell theis unsold collections (stock-house) very fast (increasing the speed of turnover of the capital) without spending money on advertising, storage and logistic. The big brands work more and more with small limited series which require a constant destocking. For the image of the brand it is rather damaging to expose the devalued unsold clothes in the boutique for a long time. So, this other source of selling its stock-house through the vente privee sites serves like a huge support for the producer.

The brands also profit from the transforming of the care for the stock-house to the third party (vente privee site). For example, vente-privée.com has at its disposal 18 photo-studios and a team of models, graphists and music professionals to provide a top image for the goods, represented on the site.

On top, for the brand it is an extra advertising availability. The customers of vente privee sites get acquainted better with the brand (its style, designs) and one day may wish to buy something in a real boutique.

The company benefits, as it charges some fee on the goods it sells. So, without producing anything and without spending money on operating a shop (as opposed to a phisique boutique), the site makes good profit operating like a mediator.

The customers benefit as they can obtain the top brands for a reasonable price. On top, it can save a lot of time, as it is much faster and more convenient than rambling through a number of phisique boutiques. Everything is rather simple here : several clicks, a number of the credit card and the client can get the dreamed object for a good price.

Though there are some disadvantages as well on these sites : first of all, each sale is very limited in number of articles and in time provided for making a deal. In the same time, the amount of participants, willing to get a product is huge and is growing all the time. That is why, sometimes it occurs that the desired object, that the customer sees on the announce screen, is not available any more in the moment he/she wants to orders it.

Second disadvantage is usually the time it takes to deliver the ordered object. It happens as normally the sites of vente privee dont have any stock at their disposal and should order thelmselves the desired products from the supplier.

That is why, the site vente-privee.com created two big stocks now and can minimise its delivery time.

The target customers of the sites like vente-privee.com are : young people (20-35 years old), who got used to utilize internet in many ways (this kind of customers occupies the biggest portion of buyers through internet as they are more advanced and more internet-oriented than the older generetions) ; business people (for whom the main advantage of it - is time saving). Potentially any person that is interested in fashion for reasonable prices is a client for the vente privee sites.
Nowadays the number of clients of any internet shop is groving rapidly, involving more and more diversified groups of people.

CLOTHING COMPANIES CASH IN ON E-COMMERCE
13 February 2007 Source: just-style.com

Despite the limitations of selling fashion over the internet, online purchases appeared to buck the downward trend in festive retail sales. Rebecca Danton finds out why more and more retailers are turning to e-commerce, while new research suggests that online fashion sales could increase by GBP134m (US$264m) a year if websites address customer behaviour patterns and provide more product information.

The high profile collapse of Boo.com back in the late 1990s, despite an investment of millions of dollars and the incorporation of sophisticated technologies that allowed shoppers to see clothes at 360º angles, contributed to the slow uptake of online activity by clothing retailers.
But even so, the sluggishness of fashion’s entry onto the online stage has baffled many critics.

Marshal Cohen, analyst at the NPD Group, confirms that the fashion sector has been “one of the slowest to adapt to online retailing. Autos, homes, pharmaceuticals… all have been more online centric than fashion, which is supposed to be in the forefront.”

Some critics argue the many undeniable limitations and challenges of online retail are holding fashion companies back.

As industry experts point out, some shoppers are turned off the idea of shopping for clothes because they can’t try pieces on.

Not only does this take away part of the buzz for some consumers – especially those who cite clothes ‘shopping’ in its traditional form as a hobby – it can also be an added complication, with unpredictable sizing and clothes looking different in real life to the way they appear in an image.

Sales easy to lose

Jason Kemp, managing director of retail operations specialist Envision Retail, points out that on-line shoppers are also ruthless. “They will abandon a purchase at any stage in the process if they are irritated or can’t find what they want, demonstrating just how fragile a process it is and how easily a sale can be lost. “At the beginning of their search, around 75% of on-line shoppers will leave a site if a page does not download quickly or is not available. Once on a site, if a page takes longer than 7 seconds to download, 57% of shoppers will leave immediately, with just 14% willing to try again,” adds Kemp.

More standardised sizing could help with the fit issue, while a wide range of technology exists that claims to showcase clothing in a manner almost on a par with that of a bricks-and-mortar shop.

But, it could be argued, the more technology is employed the more can go wrong. Not only from a user’s point of view – as with Boo.com’s misjudgement of what sort of site its target audience wanted and could use – but in many other aspects from misplaced and overlooked orders to complex web pages freezing and causing people’s computers to crash.

One way companies can cut down on the risk of technical problems is to bring in an outside technology firm/online specialist. In fact retail giant Marks & Spencer went so far as to call in the services of leading internet retailer Amazon to develop its e-commerce operations.
While M&S has stayed responsible for managing its own site customer service operations, warehousing and distribution, Amazon has been working with the company to update its website after it struggled to cope with demand during a period of busy trading.

Fashion firm Lindex told just-style it too has employed the help of an outside technology firm as it sets up to sell online.
“We are trying to make the e-commerce website as integrated as possible to streamline the process,” says Ulrika Danielson, the company’s director of corporate communications, admitting that, nevertheless it was still faced with a number of “difficult issues” to solve.

Online tricks

Some of the tricks that could increase online fashion sales by more than GBP134m a year, according to a survey into Internet shopping behaviour by Envision Retail, include increasing the download speed of a page, and providing detailed information which actually slows down the purchasing process but helps the shopper bond with a product. The company, whose customers include Metro Group, Nike and Bon Marche, points out that fashion surfers need more imagination to assess a product’s suitability. “While shoppers’ brains screen out 99% of the visual stimuli they are presented with on the high street, it is only 45% when they shop on-line,” explains Jason Kemp. “So there is a huge opportunity to provide even more pictures of products, from various angles, in close up, to get customers hooked – but getting them to that stage means that any previous searching and downloading has to be fast.

Because they can’t touch the garment, fashion surfers need more imagination to assess a product’s suitability.

“They physically move towards the screen to try and get a closer look; they stop to think while they imagine wearing the item and then check out descriptive words to understand the texture,” explains Kemp.

He adds that a website design built to create this ‘Quick-Click-Slow’ shopping experience will help minimise the percentage of consumers who abandon a purchase mid-search.

Where a retailer suggests a complementary accessory – belt, bag or jewellery – shoppers stay on the site longer, 40% of shoppers will actually view the item and there is a 3% chance that they will buy.

Legal issues

Some internet retailers also have legal issues to contend with.
Online marketplace Ebay has found itself at the receiving end of a number of lawsuits for allegedly failing to stop the sale of fake goods on its site. Despite the company’s protests that it takes the issue seriously, some have likened the apparent wide availability of counterfeits on its sites to China’s infamous pirate hotspots.

Again, there are ways this can be tackled. Online brand monitoring and counterfeit detection firm Net Enforcers recently joined up with private investigator Gobi International to step up the fight against the sale of fakes online by detecting, tracking and uncovering illegal manufacturers, distributors and sellers.

But, as in high-street retailing, cracking down on counterfeits is never straightforward and there’ll always be some who slip through the net, however strong and wide that net is.
Turning to a different type of retailer, another source of contention could be that going online is yet another way for retail giants to monopolise the retail market.

Tesco, for example, recently told just-style of plans to trial clothing sales online – even though the company has already been subject to an inquiry into its increasing domination of the grocery sector and is now being slammed for taking over big chunks of a growing number of other, non-food markets.

However, a spokeswoman for Tesco told just-style the company queried the ‘non-food’ categorisation as a lot of competitors are larger in separate areas.
She also denied that Tesco was trying to take other companies in the online clothing market, adding: “Clothing is a relatively small business for us at the moment but it is growing quite quickly,” and said that “the customer would be the winner” from the expansion of clothing retail onto the internet.

Despite its pitfalls and the complications it brings, when it is done well online retail does have a great deal of advantages for retailers and consumers. And despite its slow entrance into the apparel sector there have been a few examples of the successes to be had – Bluefly, Asos and Net-a-Porter to name just a few.

Unlike high street shopping, online requires a minimum of effort; a sure bet for those in a hurry or people who struggle to get to the shops.