One of every five beauty purchases online is made via the Amazon marketplace, according to a new report.
FanTree uses star power and shoppers to market sales through social media.
FanTree, a members-only flash-sale site that launched quietly in August at TheFanTree.com, has social baked into its business model and is banking on the social followings of its shoppers and its product designers for its success. The e-retailer, which bills itself as an e-commerce network for athletes and celebrities, today works with San Francisco 49er Marcus Lattimore and soccer player Jozy Altidore, among others, to select or design limited-edition products that FanTree then sells.
“We evolved the idea around athletes and celebrities having direct access to consumers through social media, but were missing the e-commerce part,” says FanTree founder and CEO TK Stohlman.
The athletes post about their products to their friends and followers on social media with links to their FanTree pages. Lattimore, for example, has about 96,000 followers on Twitter; Altidore has almost 600,000. Other athletes working with FanTree include Kenneth Faried of the Denver Nuggets and Joe Lauzon, a mixed martial artist. Stohlman says FanTree has commitments from 10 to 15 more athletes whose pages and products will roll out in the coming months.
Athletes get a cut of each sale, but Stohlman says most are opting to channel proceeds to their foundations or charities, noting that a primary draw for athletes is that FanTree helps them promote their personal brands and build relationships with fans that can extend beyond their sports careers. A tweet by Altidore in August contained photos of a T-shirt for sale with a link to TheFanTree.com and a message that the T-shirt supports the Jozy Altidore Foundation. Altidore’s foundation raises money to helps kids in need, according to its web site.
When consumers visit FanTree, they are encouraged to log in with their social credentials and most do, 40% with Facebook and 20% with Twitter, with the rest signing in after creating a FanTree account using their e-mail addresses.
Upon making a purchase, consumers are added to a Fan Rankings system for their preferred athlete. Buying gear gets the shopper points, as does sharing news of their purchases or talking about FanTree on Facebook and Twitter. For example, an Altidore fan who bought the T-shirt tweeted, “Just got my JozyAltidore JA Foundation charity Shirt from thefantree looks great great cause #fantree.” That sort of share earns the consumer points, Stohlman says. A leaderboard appears on each athlete’s page and shows the top six ranking fans. Such social shares will drive traffic and sales to FanTree, Stohlman contends. In 2012, traffic directed from Facebook, Twitter and Pinterest to the web sites of the 300 e-retailers ranked in Internet Retailer’s Social 300 collectively generated $1.6 billion in sales during the visit.
FanTree and the athletes host competitions to encourage participation, offering prizes like autographed gear or a simple shout-out on Facebook or Twitter from the athlete to their No. 1 fan. “A message like ‘thanks for being my biggest fan,’ that is gold in the social space,” Stohlman says.
Stohlman says once FanTree fills out its sports star roster with about 15 athletes, the e-retailer will begin marketing FanTree to consumers through affiliate relationships with bloggers or fan sites whose audiences are attuned to each particular athlete. For example, Lattimore played college football for the University of South Carolina before going pro. FanTree plans to work with web sites that follow South Carolina sports. It’ll also place display ads on targeted sites.
The e-retail startup, which started as part of Tech Wildcatters, a Dallas-based business accelerator, counts ESPN analyst and former Dallas Cowboy Darren Woodson and retired Nike Inc. executive David Heath among its advisors.
Stohlman says that as FanTree grows it’ll be able to use the Fan Rankings and customer data, such as order shipping addresses, to identify a particular athlete’s biggest fans in each major market. Then if Lattimore’s 49ers are playing a game in Chicago, Lattimore can reward his biggest fans in the Windy City with free game tickets.
For more on Fantree and its social strategy read the upcoming October issue of Internet Retailer magazine.