Second-quarter sales at Bluefly Inc., an online retailer of fashion apparel sold at discount prices, rose 27% year-to-year to $9.5 million from $7.5 million, as its net loss narrowed 66% to $708,000 from $2.1 million, Bluefly said today.
Q2 Gross profits increased 64% over the same quarter last year, resulting from a 40% increase in gross margins combined with the increase in sales, Bluefly said. In other year-to-year comparisons, Bluefly acquired 25,478 customers in the quarter, up 13% from 22,581, as its new-customer acquisition cost declined by 29%, to $10.81 from $15.16. Gross average order size increased by more than 6%, to $187.52 from $176.70.
Bluefly's July net sales increased approximately 2% to $2.60 million from about $2.55 million in July 2003.
"Last year at this time we were engaged in a company-wide effort to liquidate inventory by slashing our prices significantly," said CEO Ken Seiff. "This year we are focused on gross profit and therefore are not making the same types of price cuts as we did in 2003. As a result, we expect our gross margins and gross profits for July to be significantly higher than last year despite the fact that sales did not grow at the same rate as they did in the first six months of the year."
Melissa Payner, president, said Bluefly has benefited from a deeper understanding of its customers and an improved online shopping experience. "Usability testing and site best practice audits identified a number of opportunities to improve our customers’ shopping experience," she said, adding that Bluefly will use outside software to develop greater insight into customer shopping behavior and conversion rates.
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