Monday, February 07, 2005

Red Envelope finds a way to make more money in e-tailing

The Internet Stock Blog has a interesting entry about the e-tailer Red Envelope. Look how well they're doing:
  • Orders rose 21% year over year.
  • Average order size rose to $87 versus $79 a year earlier.
  • Gross margin rose to 64.3% versus 49.5% a year earlier.
  • 84% of Red Envelope's top 50 sellers for the quarter were exclusive to RedEnvelope and 58% were designed in-house, versus 74% and 30% respectively last year.
  • Repeat customer traffic increased 38 percent versus a year ago.

The blog points out that Red Envelope has avoided commodity products in three ways:

  • Most of its products are exclusive to Red Envelope.
  • The majority of its products are designed in-house.
  • One third of the products it sold in Q4 were personalized.
Sounds like a formula for success for any gift retailer -- both online and "real world".


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