NEW YORK — While her classmates were going to the mall and watching movies, Susan Gregg Koger was locked in her bedroom, sifting through vintage clothing and hatching an online business. She launched it at the ripe old age of 18, turning her dorm rooms at Carnegie Mellon into back room operations that belied the size of the company and experience of its owners. Gregg Koger started Modcloth with her boyfriend, now husband, Eric Koger, who is its co-founder.
This story first appeared in the June 15, 2011 issue of WWD. Subscribe Today.
“I was shipping products out of my dorm room,” she recalled.
Today, Modcloth boasts more than 700 independent designers as well as one-of-a-kind finds such as a vintage gray wedding dress from the Fifties for $249.99, and a royal blue and black Rothchild coat from the Eighties for $79.99.
Koger and her husband were named the number two entrepreneurs under 30 by Inc. magazine, she added.
Anticipating the rise of social commerce early on, Koger eschewed the traditional retail model that relies on large brick-and-mortar footprints. “These retailers can support markdowns,” Koger said. “I spent a lot of time in malls. I saw the decline of department stores and the rise of specialty retailers. None of them spoke to me. I turned on to vintage.”
Koger noted the rise of the communications marketplace where eBay decentralized fashion on the Web. Then came Web 2.0, which created a “whole new level of transparency for retailers,” she said. “We’ll see a whole new slew of social commerce brands. But rather than being about a category, they’ll be oriented around an existing community.”
The Modcloth co-founder shared ideas for a successful online business. “Don’t treat social networks as another marketing channel,” she said. “You need engaging contests and programs. Name it — every item at Modcloth is named. Be the buyer. Work with designers to get them to pre-produce and drop samples.”
Koger said their customers can be engaged in ways one never would have thought of before. Finally, she said, “The customer is the next trend. We’re able to create brands to specific customer aesthetics.”
Modcloth allows customers to be the buyer, too. A tab on the Web site features a variety of dresses and the message, “It’s your chance to be a trendsetter! Does this dress have the right cut, color, and style? Do you think it should be produced and sold on ModCloth? You’re the best critic, so vote now!” Customers are invited to comment on the style and how they would improve it. “The detail is really cute!” one consumer said of a peach-colored strapless dress for $69. “This color would only look good on someone tan or a darker skin color….Someone pasty like me couldn’t pull it off.”
“Items that go through the tweaking program have a higher sales rate,” Koger said.