With Amazon dominating the online retail landscape, how do smaller e-commerce players carrying third-party products without Amazon’s basement prices and unparalleled supply-chain efficiencies strategize to stay relevant, competitive and thriving?
That question keeps Dan Obegi up at night. As the chief executive officer of DermStore Beauty Group, parent of beauty e-commerce sites DermStore.com, Blush.com and HairEnvy.com, he is charged with cultivating a successful niche online by luring customers whose needs aren’t entirely fulfilled by Amazon and convincing brands that his Web sites offer unique and important points of differentiation.
“The e-commerce store of the future, I think, will be defined by what Amazon is and isn’t,” said Obegi. “More interesting for me [is] what Amazon isn’t. Amazon doesn’t help build brands, doesn’t help build demand. They just fulfill demand. We will need to focus on creating value above and beyond what demand fulfillment in historical e-commerce was.”
Added value is connected to information, service, media and advertising, according to Obegi. Expert information, for example, can distinguish one site from another. Obegi pointed to Bbqguys.com, which provides tips on barbecuing from people who are pros at it, and OpenSky, which gets celebrities and tastemakers to recommend products, as sites that make good use of expert information. DermStore has tapped a variety of experts to help address customers’ concerns and find the right products to remedy those concerns.
Enabling information sharing can also be a value-added element of Web sites. Obegi singled out Fab.com, which shows customers products that are trending and what their friends are buying or looking for, as providing a useful platform for sharing. At DermStore, he said, the problem with customers sharing information is that they might be searching for products to resolve conditions like rosacea or acne that they don’t feel comfortable sharing with others, but DermStore can figure out ways to enable its customers to share reviews and articles that won’t make them uneasy.
When it comes to service, DermStore can enhance its ability to engage consumers with customization. On Blush.com, for instance, a customer may take a survey and then, by matching that survey with data about customer purchases and Web surfing behavior, the site could be tailored to that customer’s preferences. On top of that automated customization, shoppers could have access to product suggestions made by makeup artists, dermatologists and similar beauty experts. “We will have many, many more guest curators who are helping make smaller collections within a massive collection,” said Obegi, who noted DermStore carries 26,000 items.
Online videos are critical tools to enhance both information and service. DermStore, which has built a 5,000-square-foot video studio at its offices, is learning from both Joyus and QVC, and has plans to produce live videos featuring products for purchase as well as shorter scripted shopping segments. “If E Entertainment can create a TV channel around a category, why can’t we create a narrow cast online around a category and actually distribute it into DirecTV and into Netflix, maybe Hulu?” asked Obegi. “There’s a new paradigm in video that it doesn’t really matter where it starts.”
Web sites can make themselves valuable to brands as well by generating editorial content and taking the lead in advertising. DermStore has a quarterly magazine with 125,000 subscribers that will possibly become a monthly. Ultimately, Obegi envisions that the company could act akin to an advertising agency that places ads to spotlight products and brands that DermStore sells. “There’s a real opportunity to disrupt the agency model where you find somebody like me who is willing to take all of the financial risk as well as significant financial upside and be a clearinghouse for your inventory and turn it into cash to buy advertising,” he explained.
London’s newly opened @designmuseum will look back on the life and work of Azzedine Alaïa in a show that the designer helped to curate before he died of heart failure last month. The retrospective, which Alaïa had worked on with Mark Wilson, chief curator of the @groningermuseum, will look at the impact of his work worldwide. The show, “Azzedine Alaïa: The Couturier,” will run from May 10 to October 7. Read more about the exhibit on WWD.com #wwdnews #wwdfashion (📷: @zefashioninsider)
@Pharrell and his wife Helen Lasichanh were among the stars that came out to celebrate @rimowa’s first pop-up concept shop. The space, which is located on Rodeo Drive in Beverly Hills, draws inspiration from airport luggage carousels and lounge areas – and features the company’s luggage and accessories. If the pop-up is successful it could pave the way for addition temporary shops throughout the world. #wwdfashion (📷: Owen Kolasinski/BFA)
@carineroitfeld celebrated @crfashionbook’s first calendar last night with a dinner party at Spring Place in Manhattan. Photographed by @stevenkleinstudio, the calendar takes on a fitness theme and features @joansmalls, @gigihadid, @danielle_herrington_ – pictured here – and more. “[Carine Roitfeld] wanted me to feel sexy and she wanted me to be myself and feel it out on my own and do what I felt was right,” said Herrington, aka Miss October. #wwdeye
@saintrecords and @virgilabloh last night at @americanexpress’ “A Night With Success Makers” event. “I always bring it back to community because without that I wouldn’t have the courage,” said Knowles when asked how she has gotten where she is now. Read more highlights from their conversation on WWD.com. #wwdeye (📷: @lizdoupnik)
This Just In: Industry sources have told WWD that Anastasia Soare is rumored to be considering selling her beauty business, @anastasiabeverlyhills. According to those sources, Soare has tapped investment bank Imperial Capital to explore sale options for her eponymous beauty brand –– and with at least $340 million in net sales, this would be a big deal. Put in context of other recent transactions for makeup companies, Soare’s price tag could be in the billions if she were to sell the whole thing. #wwdnews #wwdbeauty (📷: @clint_spaulding)
@assouline’s latest book, “The Spirit of Bentley: Be Extraordinary” captures the adventurous attitudes and opulent lifestyles of @bentleymotors’ most creative owners and enthusiasts throughout the U.K. The 292-page hardcover has a section dedicated to showing its team of skilled artisans and photos of its most colorful owners, from George Bamford to designer @alicetemperley, pictured here by Aline Coquelle. #wwdeye
@google released its report on the most popular search terms this year. For fashion brands, the list was led by @gucci, the luxury brand that stunned the market last October when it pledged to stop using fur. Runner ups were @supremenewyork and @fashionnova, along with more established brands like @louisvuitton, @chanelofficial and @ysl. #wwdfashion (📷: @aitorrosasphoto)
In yet another fashion show shuffle, @elleryland is moving its show in sync with the Paris couture calendar — though the brand is still keeping one foot on the city’s ready-to-wear schedule. Their runway show in January will coincide with the launch of a new strategy: designing two main collections each year instead of four, which will then be released in four drops. “As we all know, the system needs to change. We need to show sooner to give time back to artisans and designers to do what they do best — create,” said founder Kym Ellery. #wwdnews #wwdfashion (📷: @kukukuba)
@maxmara’s classic 101801 coat was the cornerstone of its pre-fall 2018 collection. The design team expanded the traditional double-breasted, kimono-sleeved style into a trapeze coat, lean belted styles and a peacoat and presented them in monochromatic looks – like the camel one pictured here. #wwdfashion #prefall18 (📷: George Chinsee)