Right now I’m reading a fantastic book called By Invitation Only, which is the story of Gilt Groupe. While Gilt may not have been a great outcome for some investors (it ultimately exited for $250mm but was at one time a unicorn), it was still a great outcome for the founders and there is no denying they built a truly unique and successful brand. The book has a number of great take-aways, especially around brand building:
-It’s easier to move a brand down market than up. In other words, “Alexis had also observed over the years that it was easier to start high end and expand into mass market later than vice versa. She could think of a slew of designer brands that had started successful secondary lines, either on their own or through collaboration with retailers like Target and H&M, and in the process attracted hordes of customers hungry for a piece of those brands’ cachet. But she could hardly think of any names from the middle of the spectrum that had succeeded in elevating their brands into the luxury sphere.” More recently I can think of a few brands that have successfully moved down market including Tesla with the Model 3 and Apple with the less powerful version of the iPhone.
-Sell more than a product, sell an experience. “We spent weeks discussing in minute detail how to provide our customer with the best possible package opening experience. Should their purchase be wrapped in black or gold tissue paper? Should it include a personal, handwritten note of thanks? That summer we devised detailed packing instructions for our new warehouse that included information on how to fold various types of apparel; how to use rulers to make the folds neat; which items should be inserted first in the box; where the gold sticker should be affixed to the tissue paper and what customers should see upon first opening the box.” Another take-away here is to create an experience where there might not otherwise be one. Opening a box traditionally is not an experience, but Gilt Groupe changed that.
-Your name needs to be simple. “First and foremost, the name had to be easy: easy to spell, easy to recall, eat to tell our friends about, and easy to type into a browser, search engine, or email. In fact, Alexis knew that a compact four letters were nirvana as far as website names went.” Your name also needs to be masculine. “A business that wanted to capture men needed to design and name itself specifically with them in mind. By doing so, it could capture women too – but not vice versa. Women naturally embrace fundamentally masculine design. But brands with distinct feminine sensibility, like Oxygen network, Lilly Pulitzer, or Vogue are almost never successful in their attempts to cross over and appeal to men. Inevitably, most male consumers find feminine aesthetics alienating.”
-Create rarity and exclusivity. “Luxury brands would be hesitant to be associated with sales on the internet. But we hoped the fact that our site was members only and accessible only by password would help convince them. We’d sell direct to our members and nothing sold on Gilt would ever turn up in a Google search. And each sale would last only 36 hours.” Creating exclusivity creates buzz, similar to the time when Facebook could only be joined if you were in attending university or when Gmail came out and was invite only.
Look out for other blog posts inspired by this book: I’m not done reading it and there is plenty more to write about. Feel free to add your own tips on brand building in the comments section.