Bluefly Cuts 4Q Loss to $5.36 MillionDiscount clothing e-tailer Bluefly Inc. reported yesterday that a more focused, thrifty marketing approach and a hefty increase in repeat customers helped to trim its fourth-quarter loss from a year earlier.
Bluefly.com, which sells clothing from high-profile designers such as Prada and Gucci, said its loss for the fourth quarter in 2000 was $5.36 million, or $1.13 per share, compared with a loss of $5.69 million, or $1.20 per share, in the fourth quarter of 1999.
Bluefly CEO Ken Seiff said the reduction in net loss resulted from increased gross margins, a slowdown in expense growth and a reduction in customer acquisition costs.
"The fact that we narrowed our quarterly loss for the first time suggests to me that we have turned a corner," he said.
Fourth-quarter selling, marketing and fulfillment expenses increased about $250,000 from fourth quarter 1999, but Bluefly reported $17.5 million in sales for the full year 2000. About $5.8 million came last quarter, compared with $5.1 million in sales for all of 1999.
Gross margin shot up from 6.7 percent in fourth quarter 1999 to almost 25 percent in fourth quarter 2000.
Average monthly unique visitors increased from 508,000 to 543,000, and these visitors spent more money.
Average order size was up from $93.48 in fourth quarter 1999 to $121.81 last quarter. Average order size for new customers was up from $88.03 to $107.20. Average order size for repeat customers was up from $105.79 to $140.60, Bluefly reported.
Money from repeat buyers accounted for 50 percent of Bluefly's revenue last quarter, up 15 percent from quarter four 1999.
"The strong increase in the average order size coupled with an increase in the number of repeat customers demonstrate to me that we are providing a more compelling shopping experience for our core customers," Seiff said.
The company reported that it was able to increase its customer base and number of customers while driving down acquisition costs.
About 185,000 new customers were acquired last year. About 37,000 of them were acquired in the fourth quarter.
Its customer acquisition cost plummeted to $49.53 last quarter compared with $95.10 in fourth quarter 1999.
Customer acquisition cost for all of 2000 was $71.18, compared with $131.75 in 1999.
"The new records Bluefly set this quarter are meaningful because they are all based on metrics that help determine our profitability," Seiff said.