Online Discount Luxury: In Search of Guilty Customers

Discount luxury sites mainly serve as online platform for the “flash sales†method, offering limited-time availability of high fashion, travel, home dA©cor, and culinary bargains to its members. The idea of moving “sample sales†online was first realized on a European website, Vente-Privee.com, which now has more than 13 million customers. Following Gilt’s introduction in the United States, flash sales skyrocketed and led to the launching of many new sites, which have proved popular both with consumers seeking impressive discounts on luxury goods, and with exclusive brands wanting to unload their unsold stock quickly. Recently we found that many of the sites are going through the customer fatigue stage, and their further success requires more than just deep discounts. The article reviews possible new business strategies and models within discount luxury retail segment mainly based upon experience of the Gilt Groupe.