LONDON — Net-a-porter.com has the U.S. in its sights, and the holidays have nothing to do with it.
The online fashion retailer founded six years ago by Natalie Massenet is ramping up its American presence with the goal of significantly boosting its U.S. sales. But don't expect Net-a-porter to start offering promotions and other discounts to hop onto the holiday bandwagon. In fact, the e-tailer does very little special for the holidays.
"We're not a Christmas business, and we don't have a high cyclicality like Amazon.com would," said Massenet. "We're a fashion business, and we very much rely on steady growth throughout the year."
She added that bestsellers so far for fall include Christian Louboutin's platform, peep-toe pumps and Miu Miu's Coffer bag.
Much of that demand has come from the U.S., where Net-a-porter has opened a 50,000-square-foot warehouse in Long Island City in New York and has established a separate U.S. Web site entry, with prices in dollars. It also has eliminated taxes and duties on the merchandise that once used to be mailed via DHL from the company's London warehouse; now those living in central Manhattan benefit from the same-day service as Londoners, while customers in the rest of the U.S. can expect delivery in a maximum of two days.
Massenet also plans to tailor the site more specifically to U.S. clients, offering style tips for those attending the Costume Institute gala at the Met in May (she does the same with the Serpentine summer party in London) and advice on winter dressing for Californians. There are also dedicated U.S. customer care and personal shopper teams.
"The U.S. has always been part of our DNA and our business. It's our biggest international market and our most significant market," said Massenet during an interview at the company's bright, airy headquarters near Westbourne Grove here.
Massenet said the company's relationship with the U.S. market works both ways. "We view the U.S. market as an inspiration in terms of service. Service is king there, and nobody does it better than the Saks and Neiman's dot-coms," she said.
Since the Web site's beginning, the U.S. has generated about 30 percent of its business. Massenet said the U.S.'s share of sales could go as high as 50 percent over the next two years, but the company is determined to continue as a global player. "We also want to keep driving growth in the Middle East, Europe and the Far East," she said.Net-a-porter's sales in 2005 were 21.3 million pounds, or $40.5 million, and this year revenues are expected to double once again, maintaining a trend the company has seen since its launch, said Massenet. Profits in 2005 were 1.8 million pounds, or $3.42 million, up from 227,041 pounds, or $431,400, the previous year.
Although the U.S. was an obvious choice for Net-a-porter's next venture, Massenet said there were other reasons for setting up a virtual shop there. "Canada and Latin America are still peripheral markets, but we still want to service them," which the firm can do from its U.S. site, she indicated.
And the U.S. market, where the average purchase is a little more than $1,000, is just the beginning. Although further geographical expansion is not on the immediate agenda, Massenet is already looking to eventually set up a warehouse structure in the Far East.
"Ideally, we'd like to have overnight delivery anywhere in the world. We're doing it in most of the world already," she said, adding, "We have a very sound and stable business model and can grow quite aggressively. This is a sound business for the long run."
The success has been hard-won. Massenet well remembers the red-eye, round-the-clock work days due to unexpected spikes in demand. She said it also took time for her team to understand customers' shopping cycles.
"Now we're able to create the peaks in demand, drive traffic and turn the volume on and off like a tap," she said, but declined to elaborate. "We try not to be complacent about what the customer wants, and we try not to be too rigid in the way we approach the business."
Massenet said about 10 percent of the site's new customers are men shopping for women; as a result, the company is tapping into demand for the holidays by launching a men's Christmas shopping campaign and has a "Tell Santa" option for shoppers who want to drop e-mail hints to loved ones.
Although Net-a-porter has just begun to expand its warehousing capabilities worldwide, it's been a global operation since the beginning and has offered growing design houses instant international distribution. Vera Wang, Burberry Prorsum, Roland Mouret, Jovovich Hawk and Corto Moltedo are just some of the brands that via the Web site gained access to markets where they had no points of sale or resources to open stores."Overnight, we became the global stockist for Burberry Prorsum in Australia, the Far East and parts of Europe," said Massenet.
Roland Mouret, who had no stand-alone stores under his eponymous label and whose collection was distributed through wholesale clients, calls them "the benchmark in truly global retailing."
Corto Moltedo, who has been selling through Net-a-porter for the past three seasons, said it's an easy way for him to sell. "I'm selling bags in northern England, France and Germany where I don't have sales points," he said. "And it's an easy way for people to learn about the brand. If they ask where they can get it — and we're not in a big city — I tell them to go online."
Daniella Helayel, founder and owner of the clothing brand Issa, goes a step further and calls the online retailer a global trendsetter. "All the boutiques worldwide are looking at Net-a-porter to make their buying decisions. They use it as a point of reference."
Indeed, Massenet and her team have married retail with editorial, serving up fashion spreads, designer interviews, editors' style tips and trend reports with the merchandise. Last January, Massenet and the staff launched "Net-a-porter Notes," a twice-yearly, hard copy companion to the Web site. Part glossy magazine, part diary, part catalogue, the book is a celebration of the season's looks.
Massenet said she believes one of the keys to the company's success has been not to consider itself a dot-com.
"We're about fashion, products and service," she said. "We always saw Net-a-porter as fashion opportunity more than anything else, a chance to provide women with the most extraordinary fashion service."
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