Vente-privee.com business model: online shock prices for chic brands

If you are either a shopping discount addict or a fashion addict or both you have certainly heard about Vente-privee.com. For your knowledge and for Vente-privee.com (free advertising) it is one of the most successful stories of the French Web. For proof, the 360 million Euros sales made in 2007, and the 95% of market shares that it claims on the sector. The reason you never heard about it yet is because its name is exchanged only between friends, as a good tip .It has about 3 million members, they were exclusively recruited by sponsoring or viral marketing.
Link to Nouvel Observateur article
On vente-privee.com for example you can find a half-price Kenzo or Morgan sweater, a coffee-pot Rowenta to - 30%… and even good champagne to - 40%! For that be ready to do a small effort to discover the good deal, the Web sometimes can resemble the paradise (sometimes Hell too).Vente-privee.com sells not only brands clothing but also instruments of kitchen, equipment of DIY, cosmetics products, wine,and even cars!

Vente-privee.com draws its history from the destock market, the co-founder of this website Jacques-Antoine Granjon 41 years old worked for 20 years in the resale roughly to the small retailers and chains of discount shops. It is in 2001,when Granjon imagined for the brands a new concept, when came Internet euphoria, he wondered how to take the wave. Granjon noticed the huge commercial success of the advertising campaign Crossroad at Carrefour " 10 000 television sets at 1 200 francs, and no one more "... And then, one day, he saw a queue of 300 metres at the opening of a private sale of footwear at Westonin the Champs Elysee.Then Bingo! he concluded from it that it was necessary to play at the same time on the feeling of privilege and fright of scarceness: the concept of " sale flash " was born.
Created six years ago, the company’ results equal those of e-commerce French giants. vente-privee. Com invented online occasional sales.The concept met an incredible success and it attracted more than 3.5 million visitors to the first quarter 2007.

a.Vente-privee.com and Customers

• The customers are first of all brands, On Internet; reduction of stocks recovered its dignity to luxury. Christian Lacroix, Burberry, Mark Jacobs or Valentino, fashion, principally female, makes the part of the lion of sales. All brands have unsold items and the growing number of collections, until six a year, encourages them to entrust vente-privee with their products.

• The customers are of course the traditional offline shoppers who converted to online shopping for convenience. Vente privée as an online store is available 24 hours a day, 7 days a week, many consumers have Internet access both at work and at home. A visit to a conventional retail store requires travel and must take place during business hours. Customers don’t need to drive to the Mall; no need to looking for parking space; no parking fees , no pollution with the car and no need to queue up to make payment. Online shopping is a sort of paradise for online customers and vente privées is a ‘priviliged’spot in that paradise.

• Vente privée gives the costumer the impression and feeling being g a privileged consumer (because he gets an email invitation, which actually is sent to a large public, it is not as private at it sounds) it gives them the impression of having made an incredible bargain and a big deal in a very short time (sometimes in the early morning or even the middle of the night), the customer most of the time clicks and buys impulsively not really certain of needing the item: a Vanessa Bruno at 110 euro instead of 355 , a Dolce and Gabana T-shirt at 42 euro instead of 150, a Zegna shirt for man at 50 euro instead of 100 or the digital camera Sony at 230 euro instead of 400, destocked products are sold between 30 and 70 % less than in boutique

• To enter this virtual world of vente privées, the customers have an access via a devoted electronic mail. «The members are informed of sale thanks to an e-mail. A specific link allows them to not miss the event which lasts only some hours, This system gives feeling to the consumer to be a privileged having access to a virtual luxury show-room thanks to precious in his precious sesame. This impression is reinforced by the well-manicured extremist side of this category of sites.

b. vente-privee.com and Suppliers

• Vente privée gives the opportunity for a better control of sales for brands; it is essential for brands, their notability and their picture. By reducing stocks their products on Internet, they have guarantee not to see dragging their goods loose in the receptacles of markets as very often in the real world. The company disposes of photographs of a real studio with professionals of picture and models.
• The multiplication of the actors and suppliers has the effect a serious battle between websites, notably those of the luxury, to attract the most prestigious brand, but vent privé has more experience with these suppliers.
• With more than a million products delivered a month, venteprivee.com establishes itself as the first customer of service package of Post office in Ile-de-France.
• The talent of vente-privee.com is its ability to entice brands they are its main partners. While, for the marketing representatives for the Adidas, Calvin Klein and other Tefal, the wholesalers at the end of series smelt the sulphur, venteprivee.com knew how to win its dignity. For these brands, it is a new tool of extremely powerful reduction of stocks. Not only, are they not any more afraid to damage their picture with products which trail along loose in receptacles. But with vente privée they are assured to sell 20 000 - 30 000 products in twenty-four hours in discretion, and especially at twice as well brought up prices as with the wholesalers.
• Vente-Privee.com allow to the actors of online sale to create strong events to enliven their customers base and to re-make more dynamic and impulsive purchase at various times of the year over and in more hollow periods.

d-vente-privee and the Owner of the business

Because of the success of Vente-privee.com Jacques-Antoine Granjon became the emblem of the French success of the Net and online shopping. The guests during the delivery of Favor' i had to vote by SMS to elect the most striking personality of the world of online shopping. The CEO of vente-privee.com was chosen to enter the " virtual Pantheon " of the e-business, even if Jacques-Antoine was anxious to underline that he was alive well and truly in the world of the e-business.

1. The customer groups served

· Women have a reputation for shopping more than men due to growing incomes. worldwide, women tend to stay longer at the mall and spend more, according to a recent mall study by the International Council of Shopping Centers. The longer customers stay at a mall, the more shops they will browse, increasing the amount of money they will spend. When men need a pair of pants, they go to the mall and buy a pair of pants,Women, when they shop, tend to go to several different stores and do quality shopping. The woman shopper is the quality shopper who tends to spend more per capita.
· Marketing firms are taking note, figuring out the most creative way to craft their messages to the female consumer .Vente-privée.com seems to target this specific group more than others for all items and products on sale, with a very attractive website.
· In the other hand, Men who can’t be bothered to go out shopping are helping to drive rapid growth in online retailing, according to a survey by the British Council of Shopping Centres .FT.com reports that men have a ‘hunter’ approach to shopping – they know what they want and want to get it as quickly and painlessly as possible. Online shopping is the perfect way for them to do this.
· At every opening of sale, at 7 am, between 100 000 - 200 000 members wait in front of their computer to click on the best bargain. Because the best products are often exhausted at the end of some hours,”Sometimes record up to 30 000 requests a second on the website ", tells Granjon, which must have lined up 70 computer waiters to face up traffic of top.

2- Vente-privee.com revenue sources:

At vente-privee.com benefits flow, because it is a generative business of cash: the customer pays cash from order (also regulating expenses of shipping), but he accepts the packet only two or four weeks later. It has then seven days to return it, according to the rules of the mail order. But according to the trader the rate back would not show... 3 %. What is the size of this new El Dorado? No verifiable study exists.

3-Vente-privee.com competitors:

In its wake, many websites (mere copies) launched themselves, for example, achatVIP.com (the number 2 with 1.799 millions of visitors to the 1st quarter), surinvitation.com, espacemax.com, linvitedesmarques.com, spaces-vip. com, vente-groupee one. com, etc. On most of these websites (except, notably, achatVIP.com and linvitedesmarques.com), you will have to give the email of your sponsor to register you.
Another major competitor of vente-privee is 24h00 , of which the CEO Patrick Robin accuses it disloyal competition and of abuse of dominating position. " Vente-Privee.com is accused of monopolyzing the contracts of exclusivity rights that it imposes on the brands, taking advantage thus of his extremist position dominating the market.
By its power, Vente-Privee.com is the only actor able to do the sales of more than 30,000 items. The power struggle between these websites and the brands is in vente-privee's favor. Even if some refuse, they are numerous to have signed a contract of exclusivity rights, which prevents us from work with them." For jacques-antoine Granjon, this contract of exclusivity rights is justified. "When a brand signs such a contract, this is for the services vente priveeprovides: a down payment on the sale, a better promotion, reports marketing.

4-Can the model apply offline as well, or it is unique to the web?

The answer to this question will be simple: this model can not really apply offline becasue the different actors came from offline models to an online platform to make the concept happen, I beleive that offline shopping is sustainble to a certain point and for a certain occasions , certain purchases, and to certain costommers, but the future is for online shopping and more importantly to this model.
This leads us to question weather tCheck Spellinghis business model is scalable and sustainble in the long term , I think yes it is sustainble because with it we can do our shopping online right at home or from the office before leaving for home. We can buy practically anything online and have it delivered right to our doorstep. So my thinking is, will the malls and supermarkets suffer the same fate as the small local sundry shops? We cannot predict how the internet is going to be in the future but if the technology can advance to a stage whereby you can feel confidence in purchasing online without any questions about security, theft, reliable merchants and quality products, will it kill the offline malls and supermarkets? we will have the answer in few years time.

If I owned vente-privee.com, I would internationalise it(it's in the process anyway) and I would diversify
the brands, services and activities for example travel, education, health, and housing.

1 comment:

eac said...

Well thought out and good integration of your resources.

This is a key point;
By reducing stocks their products on Internet, they have guarantee not to see dragging their goods loose in the receptacles of markets as very often in the real world.

Stretch - could VP be used for market research - is internationalization the only growth area?