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A deal a day

Retail

What’s the ultimate in curated consumption? Limiting your customer’s choice to one product a day. Add a pinch of eBay-style excitement and bargain hunting, and you end up with Woot! (“one day, one deal”) and iBood. Woot founder Matt Rutledge came up with the concept back in 2004, as an internet offshoot for his Dallas wholesale business. Since then, Woot’s combination of great deals, highly novel approach and irreverent attitude have created a huge following. Thousands of regular buyers and visitors perch in front of their computers before midnight every day, hitting the refresh button to be the first to buy the new deal when it’s announced at 12:00 AM Central Time. On average, 27% of sales occur in the first hour, and items typically sell for about one-third of their retail value. The number of units on sale isn’t announced until the item is sold out, and all items are in stock and shipped within a few days. Woot had 300,000 registered users as of February 2006, and community is an important part of its popularity. Hundreds of comments are posted about each item, and Woot feeds back data like ‘first sucker’, ‘speed to first woot’ (0m 31.310s for the phone shown above), and ‘wooter to blame for sellout’. Since Woot doesn’t ship outside the United States, iBood (“internet’s best online offer daily”), smelled an opportunity. The Dutch company launched in October 2005 and ships to most European countries. Although it lacks Woot’s wacky personality, sales aren’t lagging. In the first two months after it started, iBood’s turnover was EUR 1.1 million, and expected turnover for 2006 is between EUR 6.5 and 8 million (source: Emerce). A similar concept in France is Lundi8h, which offers one idea every Monday at 8 pm (spotted by Valek). Plenty of business opportunities exist for wholesalers partnering with smart online companies. Who will offer Brazilians or Koreans a deal a day? Both Woot and iBood lean heavily towards electronics, so how about targeting a different audience? Daily deals for parents, or women, all at bargain basement prices. And don’t forget about the marketing value of placing your product before all those expectant eyes… Oh, and as Paul Jeszenszky rightly pointed out to us: the deal-a-day model has been pioneered by TV Shopping giants like QVC, HSN and The Shopping Channel. So yet another source of inspiration and learnings if you’re going to launch your own Woot / iBood / Lundi8h.

Website: www.woot.com, www.iBood.com

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