“I partner with my customer.”
That’s Sophia Amoruso’s secret sauce for building Nasty Gal into the cool fashion site for twentysomething young women who aren’t afraid to show their edgy, retro side.
This story first appeared in the October 29, 2013 issue of WWD. Subscribe Today.
Amoruso is the company’s founder and chief executive officer.
For her, partnering with the customer came easy: She is the customer she curates for and engages with them in a dialogue on an ongoing basis, using social media to engage regularly with them.
The company’s roots began with Amoruso, at the age of 22, selling vintage apparel on eBay. While she wore vintage apparel and had some photographic skills, Amoruso had never worked in a store. Initially, she did all the work herself out of her apartment, from taking pictures of the merchandise she put up for sale to writing product descriptions for the eBay store. Self-effacing, Amoruso candidly described the process and how she learned through trial and error what worked and what didn’t.
Through the initial sales on eBay, from learnings on presentation and style, Amoruso said, “I realized I was building a brand.” That led to taking the brand off of eBay, and moving it to a MySpace page, where she added content, musicians and other “culturally relevant personalities” who were followers or friends of followers of the brand.
“I didn’t know it was marketing,” Amoruso said candidly.
Today, the site now known as NastyGal.com has broadened its offerings to more than just the vintage market. Last year, the firm received $50 million in financing from Index Ventures, which also invested in Asos and Net-a-porter, to expand the business.
According to Amoruso, Nasty Gal came into being because she was able to ascertain what sold and why. Vintage apparel as a rule is mostly a one-of-a-kind item, and Amoruso said she was watching behind the scenes on her computer analyzing “what items were selling via a photograph and what items were selling [when] on a hanger.”
Keeping tabs using the computer as a form of “listening” to the consumer allowed Amoruso to build the brand via word of mouth.
According to data from the company, the top 10 percent of customers return to the site 100 times a month. The target consumer is mostly in her 20s, either in Los Angeles or New York, and wants to be in fashion or is working in fashion. “She is educated. She is not a wallflower,” Amoruso emphasized.
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As for social media, the ceo said the space is “pretty cluttered” with conversations, adding that “social media is great for brand-building, but it’s not necessary for transactional conversations.” While Amoruso said she is still learning how to engage the customer, those dialogues after five-and-a-half years now allow the company to design product for the site. And because they know what the customer wants, that has led to better sell-throughs.
Nasty Gal just hired a chief financial officer, and will be hiring a chief merchant soon.
Amoruso laughed when asked whether $1 billion in sales is her target goal and, while not directly answering the question, said “$1 billion seems like just a fun number today.” The company has said it hit close to the $130 million range in annual volume last year.
About 30 percent of its sales are overseas, and Amoruso said the Nasty Gal customer abroad likely isn’t that much different from the customer domestically, although she needs to do research to learn more about the international customer.
Amoruso also spoke briefly about her book, “#GirlBoss: How to Write Your Own Rules While Turning Heads and Turning Profits,” set to be published in May. Part memoir and part business advice, Amoruso said the book is about “how you can hack it in life and still make it.” Amoruso left home at 17 and elected not to go to college. Her one-woman store when it was on eBay is now an employer of more than 300.
As for why a business book, Amoruso said she’s always liked business books, although “I don’t actually read them. I read the back of the book and try to absorb that.” More seriously, Amoruso said she is proof that one can build a business learning through trial and error and by working hard.
While she didn’t rule out becoming part of a bigger corporation, Amoruso said her focus is growing the business. “Investors will want their money back at some point. I’m not in any hurry to give it back,” she said, adding that “any smart person will want me in the business.”
As for how to grow Nasty Gal, some options include opening retail doors, maybe some pop-up stores and going to college campuses to get the word out about the brand. Also possibly down the road is the wholesaling of the Nasty Gal line to department stores.
Amoruso declined to offer any predictions about how far down the road she can see in terms of where Nasty Gal will be or how it will evolve. That’s when she said there are so many ideas and opportunities to explore she’s still learning what will really gel with her customer.
One thing the ceo is eyeing is the addition of more content to her site, such as features that get her interacting with her Nasty Gals throughout the day.
When asked why do anything now, such as add a blog tab to the site, Amoruso reasoned, “Because we can.”