Members-only retailers and merge

August 21, 2013 01:19 PM and Inc., two Top 500 web-only, fashion-focused, members-only retailers, have merged. The new company will operate as JustFab but retain the two separate brands. It will have a combined membership of more than 33 million.

The members-only companies did not disclose terms of the deal. JustFab is No. 201 in the Internet Retailer Top 500 Guide, which says the subscription e-retailer had $100 million in sales last year. ShoeDazzle, No. 212, had Internet Retailer-estimated sales of about $95 million last year. The companies say they expect to take in more than $400 million in revenue in 2014, and “achieve profitability” that year.

“Today we are creating one of the world’s largest and fastest growing fashion e-commerce companies, with a clear path to creating a multi-billion dollar fashion company here in Los Angeles,” said Adam Goldenberg, co-CEO of JustFab. “By maintaining the distinct JustFab and ShoeDazzle brands, we will be able to significantly broaden our reach in the United States, and continue to take substantial market share from traditional footwear brands, retail players and e-commerce competitors.”

Goldenberg, along with JustFab co-CEO Don Ressler, will work as co-CEOs of the combined company. ShoeDazzle co-founder and president MJ Eng will continue to run that brand. ShoeDazzle CEO Brian Lee takes a seat on the new company’s board.

JustFab launched in 2010 and operates primarily as a subscription e-retailer. For $39.95 per month, members receive fashion product offerings tailored to their tastes each month via e-mail. JustFab sends members monthly e-mails describing the items the retailer sells. The retailer’s members can skip buying any month, as long as they notify JustFab by the fifth of the month. Shoppers can also pay a premium price—between $49 to $69 per item—to buy items without becoming a member, although less than 1% of consumers do, Goldenberg has said.

Earlier this year, JustFab bought European members-only shoes e-retailer The Fab Shoes, which operates in France and Spain. JustFab says it has 15 million members, including in such countries as Germany and Spain.

ShoeDazzle launched in 2009 and says it has 18 million members. In 2012, it moved away from its subscription model. Consumers who subscribe to receive the online shoe retailer’s personalized recommendations no longer need to reply to those picks within six days to avoid being charged.

According to the Top 500 Guide, both brands have a shopper base that is 60% female.




Top Solution Providers