Flash-sale sites like ideeli and RueLaLa attracted attention as the next wave in e-commerce, marketing themselves as Internet boutiques where shoppers could buy high-quality goods at reduced prices. The second part of that equation may soon disappear. One of the most popular flash-sale sites, Gilt.com, now says that about half of all their merchandise will sell at full price in a few years.
Competition among flash-sale sites has increased since 2009, and with many shoppers concerned with the economy, even the more established sites in the market have begun to worry that shoppers may think twice before spending on luxury goods.
“They’re doing what was the whole danger of the retail business in the first place – investing in inventory – and that’s the part that’s a little unintuitive here,” said Sucharita Mulpuru, a Forrester Research e-commerce analyst. “I wouldn’t say it smacks of desperation, but it’s definitely an attempt to figure out how they can pivot and change their business model because the first one didn’t work out as they planned.”
Read more at The New York Times.
