May 1, 2012, 12:00 AM

Local talent

(Page 2 of 3)

Italy's economy could literally grind to a halt in 2012, with the European Commission forecasting economic growth of just 0.1%. But one of the country's oldest and biggest online retailing companies—Yoox Group (No. 69 in the Top 400 Europe Guide)—expects to weather the current storm intact, thanks to its diversification.

In 2011 Yoox reported total sales of 291.2 million euros ($387 million), a 35.9% increase from 214.3 million euros ($284.8 million) in the prior year. That figure includes revenue from, and the company's e-commerce services business.

Yoox, which saw sales in its home market of Italy increase 17.3% to 57.7 million euros ($76.7 million) from 49.2 million euros in 2010 ($65.4 million), is growing despite tough economic times in many parts of Europe because the company is well on its way to becoming a global business-to-consumer e-commerce company, says CEO Federico Marchetti. "Since the very beginning, our strategy has been to offer the best online experience to our customers throughout the world and, for us, this means investing seriously in localization for different countries: a global reach but with local expertise," Marchetti says. "Our aim is to be much closer to our customers with tailor-made offerings dedicated to the different countries."

Revenue for North America in 2011 reached 59.7 million euros ($79.3 million), an increase of 41.5% from 42.2 million euros in 2010 ($56.1 million). Sales for Europe, excluding Italy, grew year over year 37.5% to 141.6 million euros ($188.2 million) from 103 million euros ($136.9 million).

Privalia looks to prevail online in Spain and elsewhere – Privalia Venta Directa SA

Armed with a war chest of fresh equity capital and a retailing strategy built on flash sales—limited-time sales featuring deep discounts—Privalia Venta Directa SA (No. 42) is quickly ascending the ranks of Europe's e-retailers. In 2011, Privalia posted sales of 400.5 million euros ($518.4 million), up 137.8% from 168.4 million euros ($218 million) in 2010.

In March of 2011, Privalia expanded into Germany, one of Europe's three largest e-commerce markets, with the acquisition of apparel retailer Dress for Less. The acquisition was funded in part by 88 million euros ($113.9 million) in new equity financing. Prior to the acquisition, Barcelona, Spain-based Privalia had a strong presence in Brazil, Italy, Mexico and Spain, all countries with the potential for rapid online sales growth where consumers have shown they will embrace flash sales.

Privalia offers such top brand names as Claire+Bruce, discounted up to 70% off store prices, to members through exclusive three- to five-day sales. Privalia's membership totals more than 9 million, up from 6 million in 2010. Members are notified about sales by e-mail. Flash sales enable apparel manufacturers to clear out excess inventory. "Brands can sell unsold stock from past seasons and customers can buy first-level brands at high discounts," says Ferran GŸell, corporate marketing director. "This win-win deal for brands and consumers is what has made Privalia grow so rapidly since its founding in 2006."

Since launching The Fan Shop on Facebook in 2010, Privalia has conducted more than 120 sales and presales through the site. About 85% of its Facebook fans have downloaded the Fan Shop app to their Facebook pages.

Catching the early-bird shopper –

Riding its strong appeal to women ages 25 to 45, many of whom tend to shop online using their smartphones between 6:00 a.m. and 9:00 a.m.—a.k.a. the morning shopping rush—Belgium-based Vente-Exclusive N.V. (No. 228) grew its sales in 2011 to 30 million euros, up from 16.5 million euros in 2010.

On average, about 10,000 shoppers visit Vente-Exclusive's web site each morning via smartphone. Since Vente-Exclusive launched its iPhone app in June 2011, more than 20,000 of its 1.5 million customers have downloaded it. Vente-Exclusive, which sells to consumers in Belgium and the Netherlands, is part of a growing list of e-retailers offering flash sales that includes Ru La La and Gilt Groupe.

As a web-only retailer, Vente-Exclusive offers discounts of up to 70% on overstock brand name apparel. On average, members receive a 50% discount on any of the 400 fashion and lifestyle brands in Vente-Exclusive's portfolio. To ensure its deep discounts, Vente-Exclusive secures the available overstocks from the manufacturer or supplier for the duration of the sale, which is usually four to six days.

"Not having any physical stores helps limit our costs," says Peter Grypdonck, CEO of Vente-Exclusive. "Every day our objective is to surprise our members by offering top brands at great discount prices, excellent service and to keep innovating."

Some of the most popular items sold on the site include women's fashion apparel, lingerie and accessories. In 2011, Vente-Exclusive sold more than 1 million items on the site, nearly double the number sold in 2010. "Our mainly female audience loves to buy these products," adds Grypdonck.

Youngsters lured by TV ads and Facebook –

Traffic to fashion retail site was up 400% year over year in Q4 2011, thanks in large part to a major television ad campaign dubbed "Drop Dead Gorgeous," which the retailer rolled out for the holidays, says founder Nitin Passin. Missguided (No. 308) says it is one of the few web-only fashion retailers to advertise on television in the United Kingdom, but finds the TV medium resonates well with the 16- to 35-year-olds that the retailer is after. "Missguided's ad buying has been targeting our core audience through select TV shows," he says. "TV ads are perfect for our target market."

Social marketing also drove a healthy chunk of the retailer's 380% sales increase in 2011, and 15% to 20% of its traffic comes from Facebook. Missguided has focused on giveaways on Facebook and discounts for shoppers who Like the retailer on the social network, Passin says. Those efforts contributed to 40,000 new fans in January 2012, and Facebook is now the biggest single driver of traffic to the site.

Passin, a third-generation member of the fashion industry, launched Missguided as a web-only retail operation with 50 products in 2009 when European bricks-and-mortar apparel retailers were suffering. "I had no e-commerce experience," he says. "But back then e-commerce businesses were the only businesses going up and I didn't see a future in anything else, so I took a chance."

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