Sample sale is an interesting resource for products for both mainstream and luxury brands. Even, you’ll find online private sample sales which are increasing in number.

In general, in a sample sale, big designers, (Marc Jacobs or Versace) offer their access inventory on a sale site at 50 to 70 percent discounts over a several day period. Such sales are private which means they are available only to members. Such sales are announced via emails. Products available in sample sales include clothing for men, women and children as well as jewelry, handbags and home accessories. If you want to attend such sample sales, you can get invites from other members or request invites via the site.

There are several startups who are active in the online sample sales space like Gilt Groupe,  Ideeli  and Hautelook .  The user base and the money are both are growing at a rapid pace and they are turning a strong profit. Retail giants like Saks and Nieman Marcus also find the concept interesting and  have joined the bandwagon  to offer their own private sales. Even GSI Commerce,  which plans to get into the private sale business with the recent acquisition of sale site RueLaLa.  

Sample sales are on the way of becoming a compelling market opportunity. Vente-Privee is on target  to achieve €650 million in global turnover this year. According to reports  by The New York Times, Gilt Groupe, founded in late 2007 achieved $25 million in it’s first year of operation. Gilt currently has 1.6 million members, $40 million  in funding in July and the startup was valued at $400 million. Ideeli was founded in November of 2007, has more than one million members, is set to do $50 million in revenue this year, and expects to earn $175 million in revenue next year.

This model is successful because of several reasons. Among them the following three are most important -

  • 1. People ( women and men) can now avoid the chaos of the in-person sample sales
  • 2. The sales are now brought to the masses. So shoppers from all over the world now have access to these goods.
  • 3. As the sale only takes place in short amount of time, with limited stock available, shoppers feel the urgency to actually buy the product.

These sample sale sites presents the brand in a luxurious, desirable way, via a “private” sale, and that is why designers don’t feel bad about that these online sales because the value of the brand in intact. Designers find that it is better than their products sitting in a bin somewhere. That is why Gilt has got a premier designer like Marc Jacobs to sell his coveted handbags on its site for half the price. Startups like Hautelook even provides the designers a real-time metrics dashboard that lets them see what items are being bought, what parts of country where specific items are selling best and more.

With the success of this model, several retail shops and other technology companies are planning to either acquire or build private shopping sales of their own. DailyCandy released the news  of their private shopping club. Designers themselves, like Tory Burch, are holding few-day private sales online. At the same time, Gilt, Amazon and eBay are looking at acquisitions in the European private shopping club space.

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