VIVRE SCORES $8 MILLION, REWORKS SITE

Byline: Valerie Seckler

NEW YORK — “Vivre la difference!” might as well be the new mission statement of Vivre.
That’s the newly named entity comprising the luxury e-tail and catalog units of L’Art de Vivre and Indulge.com that has just scored $8 million in fresh funds in a third round of financing from its original trio of venture capital investors, plus a European financier the company declined to name.
The new moniker for the venture — formed last January in a stock-based merger of Indulge into the six-year-old cataloger, which specializes in upscale European labels — reflects a reversal of the company’s initial plan to fully integrate the two units. After a year of doing business in cyberspace, Vivre has found it has to scrap that strategy and instead develop two different business units to address what it has found to be two quite distinctive customer bases. In fact, Indulge.com might eventually be spun off as a stand-alone entity, but there are other missions to mount first, said Eva Jeanbart Lorenzotti, newly named chief executive officer of Vivre and founder of the L’Art de Vivre direct marketing business.
“We’ve found the customer demographic and average order size are significantly different for Indulge.com and the L’Art de Vivre catalog and e-tail site,” which now bear the Vivre name, Lorenzotti noted in an exclusive interview. “The Indulge customer is younger, 25 to 35, on average, and is driven more by lifestyle enhancement. The Vivre customer is more motivated to search for particular products under specific brands, and falls largely into the 35-to-55-year-old range. The average transaction at Vivre,” she added, “is $350, while the average at Indulge is $80.”
When these trends first surfaced, Vivre tried staying with its original scheme to integrate the businesses by adding items to the Vivre catalog and Web site that it thought would appeal to the younger customer. That included fashion accessories like red faux ostrich-print handbags, as well as a small range of apparel items such as intimates and sleepwear. That extended the assortment beyond its base of luxe hard goods and gifts. The latter categories also were updated with some trendier items, like Razor scooters and cigar humidors.
“But that didn’t draw the younger customer,” Lorenzotti acknowledged, “and we decided to shift gears. About 60 percent of Vivre’s [buying] customers are women,” she continued. “It is much harder to get the 35-to-55-year-old group to convert to Internet use than it is for the 25- to 30-year-olds.”
Brands carried by Vivre include Annick Goutal, Baccarat, Carolina Herrera, Cartier, Chopard, Christian Lacroix, S.T. Dupont, Ferragamo, Hermes, Lalique, Lanvin, Loro Piana, Molton Brown, Penhaligon’s, Petrossian Paris and Sulka.
A new version of the Vivre site has just been soft-launched, for final testing among the company’s friends and family, ahead of the official reopening slated for the first quarter of 2001. At the same time, the merchandise mix at Indulge has been heavily edited, now amounting to about 4,000 items, or half the number it opened with 11 months ago. There is a sharper focus on beauty and lifestyle essentials.
Another change has come in the management: Cathy B. Taylor, a founder and former ceo of Indulge.com, has left the business. Taylor and Ken Landis founded Indulge in April 1999 as a gift, beauty and high-end accessories business. It went online last November with seed money from three venture capitalists: RRE Investors, based here, and two Boston-area houses, Charles River Ventures and North BridgeVenture Partners. The merged entity formed early this year and secured $20 million in March in a second round of funding from the group.
Landis, who also is a founder of Bobbi Brown Cosmetics, has been tapped as chairman of Vivre’s board, and Doug Ford, Indulge’s chief financial officer, has been named chief operating officer. Ford joined Indulge from Kurt Salmon Associates, where he was a partner and northeast regional director of Supply Chain Services.
“We probably won’t add a new ceo for a while,” Lorenzo said, adding, “For right now, we’re concentrating on fourth-quarter business. In the first quarter, we’ll have a clear plan to announce about Indulge. We may break it out of the overall corporate structure, but in either case, it will have its own customer focus and ceo.” She said Taylor had left “to pursue other interests,” but declined to elaborate.
In addition to restructuring the e-tail businesses, Vivre is establishing a unit to cater to third parties, including its business-to-consumer e-commerce partners, with services such as creating and distributing customized catalogs and magalogs, and implementing customer service and fulfillment infrastructures for e-tailers and other direct marketers.
Through a new marketing alliance with American Express, for instance, Vivre will be in contact with more than 175,000 Platinum and Centurion cardholders with a customized version of Vivre’s Gift Book called “The Gift Diary Vol. 1.” The first edition, whose goods are available now through Jan. 31, features items like a 24-karat gold vermeil Renato Cipullo cuff, priced at $375; a Christian Lacroix perfumed vanilla candle in Limoge porcelain with gold-leaf detail, $130; a Renaud Pellegrino calf-hair bag with brown leather interior, $650, and a Baccarat crystal flower and 14-karat gold 16-inch choker at $700.
New arrangements, like the one with American Express and another with Merrill Lynch, are being built on a foundation of similar deals Vivre did with Christofle and Bulgari: It has designed Christofle’s Web site and produced its catalog for the past four years, and has handled the fulfillment of Bulgari’s U.S. catalog business as well as distributing that catalog.
Also a possibility for Vivre, Lorenzotti said, are potential partnerships with rival upscale e-tailers Luxlook.com, the designer accessories site funded in part by Holding di Partecipazioni Industrali that went live last month, and eLuxury, Bernard Arnault’s ambitious project, mounted in May. “We are very close with Luxlook and eLuxury; we share ideas, we talk with them a lot, and we may end up doing something with one of them someday, since we’ve got different brands and areas of expertise.”
Overall, Lorenzotti said, Vivre’s sales are “north of $10 million,” and the company is expected to become profitable during the fourth quarter of 2001 — a year ahead of its original projection — based on the new business model and plans.

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