Boo.com Relaunches as US-Owned Online Global Fashion Guru
Boo.com's name was purchased June 1 by fashionmall.com, a vertical portal focused on fashion, accessories and lifestyle products. Two weeks later the firm hired Kate Buggeln, a longtime retail executive, as CEO.
Fashionmall bought the brand, she said, in order to use it as an entry into the European market, which is "terribly important for us. The original boo.com did 70 percent of its business in Europe.
"We will be going out and finding the most interesting products and content from magazines and other fashion sources and bringing them to consumers around the world," Buggeln said.
The new boo.com will not sell anything directly and will not have any inventory. For the first year, it will drive traffic to online partner retailers that have items shown on the boo Web site in stock.
So far Buggeln has signed up about 40 merchants, half of them from the US and the other half from Europe, mostly from the UK and Germany, though there is one French company in the mix.
"In the shopping area of the Web site, Miss boo (the mascot of the original site) will explain why a product is interesting, and if surfers want to buy it they click on the product picture and are taken to the merchant's Web site," she said.
The boo brand, she said, "has a positive and compelling association with fashion, and that is what we need to carry forward. You can only leverage your assets, and that means using our credibility in fashion and style.
"We don't have any credibility in terms of the previous business model, which was associated with squandering money." (Boo went through $120 million in capital in a year.)
The association with style and fashion, however, seems to have held up, she said, citing high media interest and the 35,000 people who visit the holding page every week. "So there is some level of consumer interest."
Buggeln had a survey on the holding page for a month with 20 consumer and fashion questions on it, and 20,000 people replied. "What we need to do is execute extremely well when we relaunch," she said.
"We have to take advantage of the awareness and the interest in boo and deliver on that. We have a short window of time to take that awareness and give consumers a wonderful experience when they come to our site. If we do they'll come back, if not we've lost.
"One advantage we have now is not owning inventory. We believe that the more fashion-forward you elect to be as a brand, the more dangerous it becomes on the inventory side.
"It is difficult to anticipate what people are going to be wearing a year from now, but that's how far you have to look ahead, particularly as global style becomes a bigger influence on everything we wear."
A wrong guess can load a company with a "ton of unsold inventory," so for the first year the new boo.com will act as a fashion advisor. It will not begin selling boo-branded items until the fourth quarter of next year.
Partners will hold the inventory and will pay boo.com "some percentage of boo-branded sales."
But that is only one revenue stream in the business plan, Buggeln said. "Our core revenue stream will be advertising and sponsorship on our site." Further down the road will come monetization of a planned community section made up of chat rooms and message boards.
"A lot of people have that, but what makes ours better is that we will be engaged in the online conversation. We'll monitor the board. We'll look, listen and take part. I'll come on regularly, and so will others in boo."
When a woman in Germany, say, finds a great pair of studded jeans and talks about them with boo surfers in London and New York, the company will pay attention and start looking for them as a possible Web offering.
Should boo's "style scouts" want recognition for an idea or a new product, "we'll do that as well. Connect the right people on our platform to talk to each other, and we as boo can influence where fashion is going," she said.
"The data we aggregate in the community area is of interest to people in the business world, and we will be building a data model we can sell over time." The data will not be unique or individual.
"We won't sell Harry's e-mail or what he has bought, but we will sell what all the Harrys in Germany are doing and how that differs from other trends." She has talked to data companies but has not discussed yet how to structure the idea.
"My personal approach to building the business is antithetical to the original boo. We don't like to spend money unless there is a clear return on investment for that spending.
"The original boo spent $40 million for marketing the launch, and we will spend less than $1 million. We focus on profitability, and boo was focused on a rapid IPO." The market, she conceded, is quite different from a year ago.
"Then it rewarded companies with a significant high evaluation at IPO time, and profitability was not part of the value proposition. Today the market has flung completely the other way and wants quick profitability."
She is using guerrilla marketing to publicize the launch, mostly in London and New York because "that's our core market where our trade lives," and on a far more limited scale in other US markets.
"We plastered posters all over town in New York and London. We have teams of people handing out Frisbees, postcards and stickers. We're trade focused, meaning we go where people in Internet and fashion work and live."
She is also using print media, ranging from GQ to small art magazines like Smock and Nylon.