Finding another new market for its platform, deep discounter Overstock.com is expanding its private-label storefront business that brings turnkey e-commerce packages to content sites with little or no retail component. Late last month, it launched a private-label version of Worldstock.com, a department on its own site that features the work of third-world artisans, on content site Salon.com, CEO Patrick Byrne tells Internet Retailer. A similar deal with another similarly focused online magazine is in the works.
“We can now create a private-label site in 24 hours,” Byrne says. “If there is an army-navy surplus store in Detroit, for example, which doesn’t want to spend millions getting its own site started, we can put up a web site for them overnight in their colors and look.”
Byrne says the private label initiative–-admittedly something like GSI Commerce Inc.’s model–-is aimed at sites that already have a lot of traffic but not necessarily a way to make money from that traffic. Visitors to Salon.com’s private label Worldstock site, accessible on Salon.com’s home page through an icon, see Worldstock’s assortment, presented in pages that mirror the rest of Salon.com, that are flagged on the page as “powered by Worldstock.”
The “powered-by Overstock” sites are not link-throughs to Overstock.com, but independent sites that Overstock populates with the Overstock departments, categories and products its alliance partners choose, says Byrne. Overstock has formed a number of such relationships with content sites including July’s announcement of a similar “powered by” alliance with women’s content site I-Village.com.
The “powered by” deals follow Overstock’s second-quarter announcement that it would seek such agreements to broaden distribution for its products. Though Byrne did not disclose numbers, he says Overstock pays a revenue share to content sites under the agreements. “We are willing to pay a hefty revenue share, and it lets these sites monetize the traffic they receive,” he says.