E058: with Alexis Maybank

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This week we have Alexis Maybank, Founder & President of Gilt Groupe.   Jason Calacanis hosts This Week in Startups at 1pm PT Tuesdays and Fridays.

00:02:00  TWiST Global Meetup, July 20th 11am PST, 2pm EST, 7pm GMT

00:04:00  3 years ago started building Gilt Groupe, taking inspiration from sneaking out to the “sample sales” for friends and family.

00:05:15  After family members started asking to look out for certain items they knew that this would do well nationally.

00:05:40  Launched in Nov. 2007, approximately 2.5 million members, hosting about 17 sales daily, 100s of thousands rush in at 9am PST for the morning sale.

00:06:30  Sales do start at different times of the day but most rush in at the same time to get in on the sale the set sales.

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00:08:00  About 30% of members are guys and are often more competitive to get in on the sales.

00:09:00  Offer is usually 50-70%, however, you need to act quickly. Return policy is they cover return shipping and accept anything that is the improper size and will exchange if available if not credit is given all other sales are final.

00:10:00  How often do the most addicted shopper purchase? A couple times a week buying more than one item.

00:10:50   People pound the refresh button because there is a 10 minute timer to purchase

00:11:30  Over 450 employees, getting great talent is always a challenge

00:12:30  How do you maintain culture? They use current employees to help vet future employees and they are involved in the hiring process, they have a keyword document that helps guide them in every aspect of the company.

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0015:30  Culture documents have become key to the success for many companies but it needs to be created organically, you can’t impose the beliefs.

00:17:25  The example has to be set by the leadership to follow the culture document, it makes it easier to be a manager and people know what to expect.

00:20:00  They hired in all areas, developers to help them scale quickly for a few short hours a day, to all different types of merchandising teams

00:21:00  Gilt has become a marketing channel

00:22:20  They are helping brands broaden their market to a different demographic

00:23:30  The products are the same as you get in the store, which is a requirement of Gilt Groupe, it’s generally off season products.

00:24:30  They are now getting involved when orders are being made but hold off on selling till it is off market

00:26:00  How involved is the community? People comment on other channels such as Twitter, people don’t want the comments to slow down purchasing

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00:29:00  The community feels they are curating the best of brands, it’s a daily escape

00:30:30  What did you learn at eBay? Learned a lot about culture and word-of-mouth marketing with incentives.

00:31:45  The incentivise because they give a lot of their marketing budget for word-of-mouth traffic

00:33:30  Many of the big retailers are trying to copy the idea

00:34:15  What do you think of the imitators? Imitation is flattery but it keeps you nimble, it make you think how can I keep improving

00:36:00   As a company they try to continue to focus on the 5 things that will improve their business long term

00:37:10  How different is travel that fashion? Jetsetter, is not last second hotel deal, it’s compelling because it is a great deal and they stay focused on where their community likes to travel.

00:39:40  Is Gilt Groupe all high end? It’s about a lifestyle and unique things

00:41:30  Can you get businesses that don’t need business, how do you get the hard to get seats? We actually do get those businesses because they want to keep the perception that they are busy, all businesses need business because it is an upscale experience.

00:43:20  Most the purchases are an emotional buy

00:44:15  Have you started considering video? They used to have video but it got in the way of the quick purchase, customers didn’t want another click for a purchase.

00:45:25  How is the iPad affecting the business? It is becoming a huge part of the business, especially on the weekends and holidays, the iPad has enhanced the shopping experience in ways that you can’t experience in a store

00:48:15  Store are perfect for the social experience

00:49:15  An IPO has been rumored but it can be a big distraction and you lose focus

00:52:17  End

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