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March 2000 |
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Sue Levin`s startup gives the long-ignored women`s sportswear market a www.workout
By Nicole Grasse
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
In other ways—such as its eclectic staff—Lucy mirrors other Internet startups. The site’s “About Lucy” section describes the 50-person staff as: “a finalist to play Snow White at Disneyland (she declined the opportunity); a cheerleader dubbed her high school’s “most athletic;” six moms (and one mom-to-be); a self-admitted exercise junkie keeping alive a four-year, 10-month (and counting!) exercise streak; a former male field hockey player; a published novelist; a former roadie for ZZ Top; two bike-trip leaders who’ve easily logged a combined 15,000 miles in the saddle; and an intrepid romantic who spent her honeymoon in Irian Jaya where she and her hubby nearly got stuck in a native insurrection!”
What draws the Lucy staff together is their passion for sports. Along with Levin’s ultimate Frisbee background and Delhagen’s experience as a triathlete and marathon winner, co-founder Hochman’s wife was a member of the U.S. Olympic Rowing Team. “We understand our customer.” Levin says, “Many of us are her, or we’ve spent long careers learning about her.”
The shipping side
To put that knowledge to work in a reliable Web store operation, Lucy has contracted with Norm Thompson Outfitters, a distribution and fulfillment company, to ship orders from a warehouse in West Virginia. Delhagen says 90% of orders ship in 24 hours. To score more customer service points—and reassure shoppers leery of getting stuck with ill-fitting gear—the site offers free exchanges and returns. Each purchase, for example, is shipped with a postage-paid return label.
Lucy’s product specialists focus on offering customers even more reassurance about ordering online. A customer with a question about running tights or a sports bra can click on a tab below the image and fill out a query for the staff. Delhagen says the staff tries to reply in a few hours. Customers who don’t want to wait can call a toll-free number listed on merchandise pages—even though the number is nearly obscured in small type .
As they enter their second year at Lucy, Levin, Delhagen and their colleagues are challenged to make shopping the site easier, expand product lines with reliable supplier agreements, consistently ship orders on time, and generally make a good name for the company. A recently inked deal with America Online will list Lucy on AOL’s shopping channel, helping build more visibility and traffic. And executives are mulling sponsorships of major women’s athletic events. Even more significantly, the company plans to enter the world of print by publishing a catalog this year. “Our customers tend to be young and busy,” says Delhagen, “and they want multiple channels.”
Improvements via a second-generation design are already under way, a pattern that’s become common with recently launched sites. Levin and Delhagen will only say that the new version, set to debut in late spring or early summer, will make the site faster.
Another e-commerce ritual that Lucy has conquered is financial backing. In January, Levin and Hochman secured $28 million in third-round financing from Oak Investment Partners and Maveron, with founding investors Sutter Hill Ventures and Foundation Capital kicking in, too. To Levin, the funding makes the process of establishing Lucy as a brand possible. “We’ve chosen our products meticulously, built a phenomenal team and created a cool storefront,” she says. “We now have everything we need to meet the huge customer demand for these products.”
Market moxie
John Lovett, sporting goods analyst at Gomez Advisors, Lincoln, Mass., agrees that the demand is out there for Lucy. What will bring customers back, he says, are the site’s community-building “Style in Motion” and Live and Learn” content sections. Lovett sees the appeal stretching across a diverse crowd that includes teens as well as 30-somethings. Lovett calls women’s sportswear “an important market that Lucy has staked an early claim on.”
That diversity means Lucy must cater carefully to its audience, says Levin, with content suited to various ages, interests and needs—hence articles dealing with both finding the right sports bra and buying a post-mastectomy bra. And a piece about how to dry out ski boots alongside another article addressing how women over 50 can get fit.
In fact, Lucy.com is based on an understanding that the marketing model used for most sports doesn’t apply well to women. Women shop differently than men and respond to different marketing techniques. “What works on men—like sports hero endorsements—doesn’t work on women,” Levin says. “Not enough retailers know the needs of women and address them in a quality way.” •
Sue Levin
— Experience
March 1999-present: Cofounder and CEO of Lucy.com.
1998: Finalist for Sporting Goods Business magazine’s Woman of the Year award.
1999-1997: U.S. women’s brand director, Nike Inc.
1994-1996: Founded and directed the Women’s Sports Marketing Department, Nike Inc.
1991-1998: Editor-in-chief, City Sports magazine.
1987: Associate Editor, Women’s Sports & Fitness magazine.
1986: Contributed to the startup of Walking magazine.
— Education B.A. in history, Swarthmore College, Swarthmore, Pa.
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