Case: Online Bridal Store

Creating a niche in a competitive market

Online Bridal Store had been an active online retailer since 2002. It was acquired by Exactly LLC in late 2004.

Pre-Acquisition Strategy:

Before it was owned by Exactly LLC, Online Bridal Store’s strategy can be described as high touch, high margin, low scale. The owner very carefully selected products from a few select suppliers. Prices were high, and orders went through a large degree of manual processing.

Our Initial Assessment

After acquiring Online Bridal Store and studying the website's visitor stats and behavior, we found the following:

  • High prices resulted in an abnormally low conversion rate. It is certainly possible that the personalized service justified higher prices, but that had never been tested.
  • The product selection was sub-par compared to competitors. The selection also lacked a narrow theme or specialty that might justify the low number of skus.
  • Manual processing was not a positive for customers. A clear line must be drawn between a responsive customer support department, which adds value, and manual processing, which is human intervention that does not necessarily add value.

Strategy

Analyze categories within the bridal segment and select one in which to specialize. Within that category, offer competitive prices, good selection and differentiated service. Automate manual processing to create a more seamless customer experience.

Actions

  • Focus within bridal accessories; that is, accessories that are worn by the bride such as shoes, jewelry and undergarments. These products tend to have a high margin, and at the time, many competitors avoided them because of high return rates.
  • In shoes, clearly the most competitive segment, differentiate with add-on services such as dye service, international shipping, and special discounts for bridal parties.
  • Automate 90% of order processing, and outsource the functions that cannot be automated. Focus domestic personnel time on Tier 2 customer support and supplier relations.

Results (2010):

  • Grew revenue roughly 800% in 4 years (2005-2009), and maintained profitability every year.
  • Defended share from major competitors such as Zappos and Shoebuy through differentiated services that cater specifically to brides.