In its second-largest acquisition, Amazon buys the company for $970 million.
RedEnvelope.com isn’t sitting still. One of the handsomest retail sites on the web, RedEnvelope undertook a re-design just before the holidays. Its clean graphics and sharp look only got better-but its philosophy stayed the same. “It’s not about doing everything; it’s about doing the things that affect a customer’s experience,” says Martin McLennan, CEO. Thus a major focus of the re-design was to simplify the checkout process. RedEnvelope reduced it by five steps. The challenge was to make it as easy to check out as at Amazon.com, the standard by which many consumers judge e-retailers, yet offer additional steps that gift-giving requires.
This is not the first time RedEnvelope has reinvented itself. It started as gifts911.com and changed its name last November. “That name worked for the giver, but not the recipient. When someone gets something they know was bought at the last minute, it detracts from the experience,” McLennan says.
There is little now that detracts from the experience of either the giver or the recipient. The key to RedEnvelope’s success is its tight focus. “The real key to merchandising has been their product selection,” says Duif Calvin of IXL. “Their gifts are a little bit unusual, but always very tasteful and high quality. You could send anything to your mother-in-law with perfect confidence that it will be entirely in good taste.” The site is organized by occasion or by recipient. It also highlights seasonal gifts on the home page. Don’t know what you want? RedEnvelope will make suggestions. “They’ve worked hard to set shoppers’ expectations that they are not a site for when you have a specific idea in mind,” Calvin says. “They say, ‘We will make a recommendation and you decide what you will do.’”
Next up for RedEnvelope: “Corporate gifts are a natural extension,” McLennan says.
San Francisco, Calif.
Monthly visitors: 269,000*
Went live: October 1999
Design by: In-house & EmDash
E-C Software: Broadvision
*Source: PC Data