Fresh from an initial, and ultimately failed trial, the premium online retailer Italic is rolling out a new strategy: to be a members-only business.
This is according to a report in the Wall Street Journal, which reports that Italic’s new membership scheme will cost $100 for a year, and will grant members access to lower-priced luxury goods.
In 2018, when Italic debuted, it was a $10-a-month club that gave access to lower-priced luxury. Though it was popular enough to bring in $13m in funding and racking up a six-figure waiting list.
However, it became quickly apparent that customers were finding it difficult to buy any more than two items a month, even though the company only sold around 15 items.
What’s interesting is that it’s the company’s second pass at such a system. Now back with a new membership plan, and armed with a larger inventory of around 100 items, it’s having another go.
“We have this large offering compared to brands and we also have it proprietary to us, where it’s never sold nowhere else,” says Jeremy Cai, CEO. “That allows us to develop this membership model where it’s actually compelling enough.”
Beginning in May, the scheme has now drawn around 2000 sign-ups.
Subscriptions are becoming an increasingly interesting business model outside of endemic businesses (such as magazines or information services) since the shift of tech companies like Microsoft, which used to sell one off packages of its software, before switching to a recurring revenue model. In luxury, where the connection more often comes from the experience of a place and of a particular level of customer service, a membership is able to provide a less situational point of connection.
It also chimes with the rise of services such as Amazon, and rival Walmart, in providing a baseline revenue with the added bonus of encouraging shoppers to spend more and more frequently.
Sourced from the Wall Street Journal