The Name: Zulily
The Place: It’s online, don’t you know. But operating mainly in the US, where it has 10 million members, and the UK.
The Story: As if your children didn’t already have every luxury money could buy, they can now also have designer wear/toys/nursery furniture at a fraction of the price. Launched in the US three years ago it opened up to the UK in 2012 where it now has 500,000 members. And those members, former interim CEO Perry Blacher maintains, are ‘incredibly loyal’ to their up to 90% discounts.
I’m not surprised, how much!! Well, the discounts on the daily sale items range from 30-90% but the average is 50%. The company provides solace to a very particular type of shopper which we might call ‘the vicariously spending mum’. Get it?
Not really. She would really like to be spending on herself as well but that spend seems so…
Selfishly indulgent? Quite. So the money shifts to that blameless and guiltless category otherwise known as ‘shopping for the children’.
Oh, that’s alright then: Every day the members get an email with the new offers. Flash sale events last 72 hours typically and those moms shop very, very frequently indeed if Blacher is to be believed, and although Zulily sell stuff for children up to 14 years of age it is the 0-6 brigade who are the chief beneficiaries.
Surely this is a niche site for the wealthier percentile? No. Blacher is adamant that the site reflects a change generally towards children. Twenty years ago clothes for the young were functional and ‘you didn’t want your kids to look like you’ but now people want the same level of attention given to their kids’ gear as their own. It’s genuinely any parent (but usually mum) that ‘cares’ who signs up and that transcends social boundaries. Blacher is very clear that this is not a Notting Hill set business.
OK, OK. So does it work like other flash sale sites? The emphasis on most flash sale sites is designer brands/bargains but these mums value the quality above all else so Zulily spends its time finding the quality products which may or may not also be big name brands, which differentiate it somewhat from its competitors. It is also almost unique in its focus on children and the broad nature of its range. Zulily has successfully created a bond with its customers that they are both looking after the family together.
I’m actually feeling a bit tearful: Get over yourself. The world of flash sales is cut throat and Zulily achieved revenues of $500 million in 2012 so you don’t get that by saying ‘goo goo’ to cute babies the whole time. It’s somewhere between a technology company and a retailer – a new breed really which is extremely data-driven – and it is the technology which gives the all-important good experience. The products need to wow subscribers every day but nothing can do that if the technology is not there.
And how do people use the site? A huge one third of sales are on mobile devices and one third of mums visit the site three times a week. There is a lot of impulse buying which is totally different from, say, planned purchasing on Amazon. It’s a ‘world of people who want to discover stuff’ and flash sales sites generally cater to that gap in the market for unplanned consumption which previously was not available on the net. There are up to nine events per day and you have to get in quick.
Go on then, what’s hot to buy? Timberland and Kickers shoe brands are always good to go with around 85% discount on this season’s range. Trunki cases have sold very well too and other reliable products are things customers feel they cannot find in the shops such as wooden toys.
Well, I heard that the whole scene has come a bit unstuck in the States. Care to comment? I would actually. It all got a bit overblown and it’s true that flash sales have lost a bit of their shine recently with Gilt Groupe the former toast of NY having some problems and some sites not executing very well but Zulily has raised $85 million recently in investment so I think we can say it is still glowing nicely. There are plenty of competitors out there (Brand Alley and Cocosa to name two) but there will be an expansionary move across Europe at some point which might further separate the wheat from the chaff.
Are they going to keep offering the same categories? The interesting thing that Zulily wants to do is grow with its customers. Having presumably ensnared mum for life the site can keep selling to her when the children are at secondary school, then University and finally when they are long gone. But we’ll have to see how it pans out. If you acquire the customer at maternity stage then the whole familial cycle is at your disposal and they will learn as they go.
Goodness, it all sounds absolutely frenetic: Its secret to date has been to have a fantastically wide range for a fairly narrow age group and to set itself up as a distribution channel for any quality products. Some brands are tiny and might be mum start-up businesses but Zulily provides visibility for them alongside the major names.
So the motto here would be… Look after the children and the pounds will look after themselves.
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