Ancestral Lily: Play to mother and infant electric dealer "Flash purchase" one year revenue 700 million dollars

What is a flash purchase? Simply put, the goods are snapped up at a limited price and offer a big discount. It's a way for the electric business to attract customers, but a lot of people are playing it. The Pioneer Fab.com was forced to restructure its business structure and cut 20% last year. In addition, LivingSocial and Groupon, which also use the flash-purchase model, are also challenged by losses and capital markets.

Zulily is an American manufacturer focused on maternal and infant products. The company adopted the "Flash purchase Model", the market last year, the opening day, the shares jumped 71.36%. Today, the company's Web site has more than 2 million active users, last year revenue nearly 700 million U.S. dollars, net profit of 13 million U.S. dollars. It was valued at 1 billion dollars.

The company's user, turnover and user per capita consumption is increasing year by year.

A focus on maternal and infant supplies of electricity, what to achieve such a big achievement? First, the strategic positioning of market segmentation, the second is low inventory of "flash purchase mode."

From the strategic positioning, the company focused on maternal and infant products, the main customers are young housewives. Why choose this customer base?

According to Zulily Prospectus, in 2012, the American family of less than 18 years old crowd of more than 100 million people. In these households, mothers usually decide the majority of consumer spending, in children's clothing, women's clothing and household and other categories of consumption, women control household expenditure of 73%. Moreover, according to relevant data, women account for nearly half of the U.S. population, but more than 60% of the net buyers.

In addition, maternal and infant supplies and other consumer goods, it is a high frequency of consumption of the market. We don't buy ourselves a new cup every day, but the baby's clothes have to be changed every two weeks.

Therefore, zulily positioning mother and child products, tightly grasping housewives play is thoughtful and sensible.

But, how to identify the market and customers, how to attract customers to come to buy it?

The first is "discount". The company's flash-purchase activities, will be launched 6 o'clock in the morning every day 35 new products, up to 50 percent discount, limited (generally within 72 hours) and limited. A list of flash purchases is sent to all users on a daily basis in the form of a message. The big discounts, the thrill-snapping, are attractive to women online shoppers.

In addition to the "Discount" temptation, the merchandise is carefully selected. The company has more than 300 buyers, every day from more than 10,000 brands of mother and child to choose the Flash purchase products. These mother and child brands are mostly small companies, they are willing to lower prices, through the Zulily website to expand sales channels. According to Mark Waden, founder of the company, "Zulily brings in orders that are 10 times times more common than those of small brands."

Of course, the company not only for the likes of "flash shopping" to provide users with discounted products. The site has more than 4,000 products a day online, also can let those who like Hai to choose.

In addition to attracting customers, the "flash-shopping model" brings another benefit to the company-low inventory.

Zulily's "Flash purchase Mode" and the General Electric business is the difference is that it is after the customer orders after the subsequent operation. In other words, when you order a product on the website, the company will conduct procurement, testing, packaging and mailing activities.

The benefits are obvious. The company's goods will not appear inventory backlog, and do not need to like other electric dealers, low-cost processing inventory to lower the gross margin. In addition, this reduces warehousing costs and increases asset turnover.

In addition, in order to increase customer stickiness, the site most of the mother and child merchandise picture models, are held by the user. This reduces the cost of the company, but also make products closer to customers. At the same time, the company will try to give each product story. Because most of the product designers ' inspiration comes from the small details of family life. The company will design the story behind the website, but also let it in the hearts of customers more humane.

There are also some problems with the company's model.

Because there is no inventory, zulily from the order to the delivery process takes 10 days, much greater than other electrical business. In addition, because the company needs to carry out a lot of procurement, commodity quality control and logistics costs are a big problem to be solved.

In recent years, zulily in addition to the website, also vigorously develop mobile phone mobile end. At present, more than 40% of the company's revenue comes from mobile terminals.