In its second-largest acquisition, Amazon buys the company for $970 million.
Sue Levin had all the vantage point she needed to survey the sorry state of women’s sportswear retailing. A five-year marketing executive at Nike, lifelong athlete and former sports journalist, Levin knew that few retailers specializing in women’s sports apparel had dared to tread beyond shoes. So when her friend Steve Hochman urged her to come run a company with its sights on pioneering the market, Levin gave up the security of her job at Nike for the uncertainty of a startup. It didn’t hurt that the new company played to the two biggest strengths in Portland, Ore.-the sports business and the Internet.
“I had been frustrated by the dearth of great women’s sports retail,” says Levin, a former ultimate Frisbee player and member of a 1990 world championship Frisbee team. At the few stores she’d come across, merchandise pickings were slim.
Hochman, a former senior product manager at Intel, proposed opening a Web store combining a full line of stylish women’s athletic wear with articles and expert advice on diet, exercise, fashion and relaxation. Last March, Hochman’s idea emerged as Lucy.com, a name inauspiciously borrowed from the dogs of two founding staffers. Levin took the lead as Lucy’s CEO, while Hochman oversees site development.
Levin knows the market like the back of a Frisbee. In her five years at Nike, she was U.S. women’s brand manager. She also opened the company’s women’s sports marketing department and held positions in public relations. In 1998, Levin’s peers named her a finalist for the Woman of the Year award from Sporting Goods Business magazine. Before joining Nike, Levin saw another side of the market as a sports journalist. She held jobs as editor in chief of City Sports and associate editor of Women’s Sports and Fitness and contributed to Shape, Walking, Mademoiselle and Outside.
In merging merchandise and content, Lucy.com promised to tap the range of Levin’s experience. But she still needed help getting the word out. She went looking for a business strategist with an understanding of both women’s athletics and selling on the Internet. Former professional triathlete Kate Delhagen, then an e-commerce expert at Forrester Research, fit the job-and Levin’s blunt style-like no one else. Delhagen, Lucy’s vice president of business strategy, is better known around the office as the company’s talking head. “If you talk to our customers, they all say that finding apparel for women’s sports is a real challenge,” says Delhagen, who’s also a 10-year veteran of Runner’s World and Backpacker magazines. “Women don’t want to be sold a sports bra by a 19 year-old guy.”
League of one?
Unlike other online categories crowded with contenders, Lucy has no major competitor in the $17 billion market for women’s sports apparel. Sporting goods sites carry selections of active wear, but nothing approaching Lucy’s range and diversity. The store, which went live on Nov. 15, currently features more than 350 products from 35 manufacturers, with brand names both familiar-Danskin, Fila, Columbia Sportswear-and less so-Bula, Juno, Mysterioso. The selection runs from tights, t-shirts and tennis wear to maternity sportswear, socks and Swiss Army watches. Footwear from half a dozen manu-facturers is coming in March.
Few others could enter Lucy’s market easily. Big-name athletic brands like Nike and Adidas tend to target men and could not reach out to the women’s market “without upsetting their apple carts” over product development and marketing, Delhagen says. And most e-retailers that sell well to women are fashion sites with limited sportswear selection, not to mention limited sports knowledge.
Delhagen says Lady Footlocker comes closest in matching Lucy’s business model. “But they tend to focus on feet, and we include much more personal information.” Indeed: Article titles range from “Looks to Lose,” a compendium of fashion don’ts from the staff, to “What Your Toes Tell You,” a chart of common toe problems and how to treat them.
That’s what sets the site apart, says Keven Wilder, a retail and e-commerce consultant based in Chicago. “It’s positioning is very good,” she says, “and it does a good job of cross-selling.” Aside from a few navigation missteps-she found the type hard to read and the toll-free number for customer service almost hidden-Wilder pronounced the site off to a strong start.
Another potential contender is Boo.com, the widely hyped sports and fashion e-retailer also launched in November. Yet Boo doesn’t put much of a scare into the people at Lucy for a couple of reasons. As Delhagen puts it, “Lucy sells things you might actually want to sweat in,” while Boo follows the mold of most other women’s site by focusing on fashion.
Boo is also off to a rougher start, beginning with a launch date delayed for months by technical problems. Though hip and tech-heavy, the site has proved slow and difficult to navigate. Boo executives have denied disappointing sales, but few analysts were surprised when the company recently dismissed about a quarter of its staff, saw its executive chairman depart, and announced a major redesign.
Lucy, which takes a much more direct approach to merchandising, also charts a marketing course that diverges from other big dot-coms. Its launch occurred without much drum roll, and its nationwide advertising campaign in women’s magazines won’t begin until this month.
Delhagen says the team at Lucy kept a low profile while testing the site and its systems for bugs. That’s not to say Lucy’s developers checked their marketing hats at the door. By the time the site went live, the company had collected the names and e-mail addresses of 10,000 women who wanted to be notified.
A passion for play