Don’t confuse members with customers

Thanks to the so-called flash-sales sites we now have a distorted definition of what being a member means. Before Gilt, RueLaLa and the myriad “private” e-commerce business wanna-bees, gaining membership in something typically meant you needed to actually do something more than have an email address and a pulse.

By now it should be clear to everyone that membership to these sites is simply a marketing gimmick. And an effective one at that.

But beyond semantics, the key issue is really how many of these members are actually customers? And of the actual customers, how many have bought more than once in the last year and how many are actually profitable (or have the potential to be)? You don’t have to tumble too many numbers to realize how shallow the customer base for most of these sites must be.

With competition heating up, and overall core sector growth flattening, it won’t be long before some investors become quite unhappy indeed.

3 thoughts on “Don’t confuse members with customers

  1. You are absolutely right.

    Our new survey of the affluent shows that awareness of these various flash sale sites is less than 10% and that visits to the sites during the past 90 days is much lower.

    The percentage who have ever made a purchase is generally less than 2% of the affluent.

  2. The flash site that I think has the most promise is the new entry from amazon, Amazon is far and away luxury consumer’s #1 visited website in Unity Marketing’s quarterly Luxury Tracking Study. Having joined up myself, I like what I see and think it can give all the rest a run for the money. But amazon is late to the party…maybe people are tired of the flash concept already, having been disappointed by some of the others.

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