The fashion and beauty online marketplace's revenue spikes as it focuses on new ways to attract repeat business.

Fashion and beauty online marketplace Spring strives to be a digital shopping destination for the urban millennial woman.

New York City-based Spring launched in 2013 with 150 brands available on the marketplace. Now, ShopSpring.com offers more than 200,000 products, mostly in apparel and accessories, from more than 2,000 brands—including Burberry Ltd. (No. 475 in the Internet Retailer 2018 Top 1000) and Gap Inc. (No. 20). Spring is ranked No. 49 in the Internet Retailer 2017 Online Marketplaces database.

“There’s clearly a strong preference for shoppers to be in a multi-brand environment,” says Marshall Porter, Spring’s president. “Consumers get the full catalog of the brands, and there’s also a convenience factor.”

ShopSpring.com has more than 1 million monthly visitors, 60% of whom are repeat visitors, Porter says. Spring’s revenue comes from about half mobile shoppers on the Spring app and half from its website—and that revenue grew 273% in 2017 over 2016, Porter says, declining to provide a specific figure.

Internet Retailer estimates Spring’s 2017 gross merchandise value at $150.0 million compared with 2016’s $51.1 million GMV, a 194% jump.

advertisement

“We’re targeting revenue growth a little north of 273% this year, and we are on track for that. The traffic is there,” Porter says. “It’s easier to acquire consumers via the web, win their trust, and transfer them to mobile.” He also notes that 40% of Spring shoppers who make a purchase will make another one within 90 days, so repeat business is a key factor in the marketplace’s success.

One of the ways it encourages repeat business is through its new loyalty program called SpringBack, which the marketplace launched in late January. When a shopper makes a purchase, she automatically receives 4% of the purchase price back as cash back to spend on a future Spring purchase after 60 days. The funds are listed as “pending” until the 60 days are up to allow for all returns to be accounted for before processing the SpringBack credit. Spring also offers double or triple SpringBack promotions to drive higher order values.

Everything you’re going to see us do is making sure it’s a personal shopping experience for that millennial girl based on how she shops.

Porter says the online marketplace provides a platform in which brands can get margins similar to what they would get if they sold directly to consumers on their own. Spring doesn’t charge brands listing fees to sell on the site, but it does take about a 20% commission on sales.

“Retail is a challenging environment for brands on their own. The emergence of the marketplace is interesting,” he says. 97% of U.S. consumers who shop online do so on marketplaces, according to a UPS Inc. and comScore Inc study released last June. That’s up from 85% in 2016.

advertisement

Spring provides sellers shopping trend data, including the age and geographic location of customers, as well as cross-brand data that gives sellers a clearer vision not just of who the customer is, but of what other brands and products she is buying on Spring.

Amazon.com Inc., No. 1 in the Top 1000, is Spring’s biggest competition, Porter says. The retail giant has made a huge push into apparel in recent years by adding private-label brands such as Under Armour Inc. (No. 33) and most recently Nike Inc. (No. 27) to sell on Amazon.com. Amazon has sold roughly $300 million worth of its private-label goods in 2017—a 12% increase compared with 2016—and its overall apparel sales grew to $1.2 billion in Q3 2017—a 32% increase compared with Q3 2016—according to a report from retail analytics firm One Click Retail.

Porter says 80-90% of products available on Spring aren’t on Amazon. For example, Amazon.com has listings for Gucci products, but the items available are from third-party sellers and likely out of season, he says. Whereas Gucci sells to shoppers directly on the Spring marketplace.

“We’re all brand-direct and authentic,” he adds, noting that Spring shoppers like to receive their items in a branded box rather than an Amazon box. “It allows our brands to control the experience.”

Apparel brand Diane von Furstenberg Studio, No. 836 in the Top 1000, sells on Spring because the marketplace aligns with its direct-to-consumer strategy, says Felipe Araujo, DVF’s senior director of e-commerce. “We control the customer experience, and it ships from our warehouse and has our packaging, so we can continue to have that brand experience that we work so hard to put forward,” he says. “Spring works with us as partners. Our success is their success.”

advertisement

In September 2017, Spring opened a storefront on the eBay Inc. marketplace (No. 4 in the Online Marketplaces database) to showcase the Spring brands to eBay shoppers.

In July 2017 it also introduced a personalization component into its mobile app where it asks the shopper to answer three questions: gender, clothing size and to choose three items from a selection of six styles that she prefers. The app then tailors its available items to the shopper, filtering out products that may not be relevant to her.

“You’ll see us roll out even more new things this year,” Porter says. “Everything you’re going to see us do is making sure it’s a personal shopping experience for that millennial girl based on how she shops.”