THE $100 MILLION EQUATION: THE ART & SCIENCE OF E-COMMERCE, Eric Koger, Co-Founder & CEO, ModCloth Check out Eric's presentation that goes with this slide deck here: https://www.youtube.com/watch?v=pCN_eiuR_Sw

1. Eric Koger
CEO & Co-Founder, ModCloth
The $100 Million Equation:
The Art and Science of E-Commerce
Commercism Conference
March 21, 2014

2. Who Is ModCloth

8. Raised $48 Million in Funding

10. 503 employees
Headquartered in SF
San Francisco – 154 Los Angeles – 53Pittsburgh – 296

11. In 2013...
• Collection of over
7,500 designs from
over 1,200
designers
!
• Growing private
label business

14. Remarkable Assortment
of Fashion & Decor
Retro &
Vintage-Inspired
One-of-a-
Kind
Vintage

17. Unique Marriage of
Art and Science

18. 965 4,550
2,914 3,031
26,621 14,767
25,061

19. Available
for Sale
2-12
Weeks
Traditional Retail “Push” Model
Disruptive “Pull” Model
Customer signals inform buying
re-order decisions
Vast majority of
Inventory sold at
full price
✓
1 YearBuyers Inventory Discounting
Buyers
2-12
weeks
2-12
weeks

20. How It Began:
Be the Buyer

22. Morgan
Skip It!
Holy salmon stripes, Batman! What is that
ruffly crap oozing out of the blood red waist
line, there? Honestly, from the waistline down
is sort of cute, but that top is a hot mess.
Bethany
Skip It!
If it weren’t for the ruffles above the
waistband, this would be a really adorable
dress.
ModLover
Skip It!
The ruffles over the belt completely ruin this
dress! Get rid of the ruffles and it would be
amazing.
11.3% Pick It!
88.7% Skip It!
Before

23. Bethany
Skip It!
If it weren’t for the ruffles above the
waistband, this would be a really adorable
dress.

24. Customers provide direct feedback…
“Get rid of the ruffles and it would be amazing.”
… we incorporate into our merchandise.
11.3% Pick It!
88.7% Skip It!
Before
63.4% Pick It!
36.6% Skip It!
After

25. • Be the Buyer
products historically
sell 2X as much
!
• Lifetime spend
of Be the Buyer
customers is
3X more

26. Lean DNA
Paves the Way
for Great Ideas

29. Community outfit-sharing platform with
shoppable images and style inspiration.

34. Windy City Dress
in Navy
Style Gallery Inspiration (11)

35. !
• Over 20,000 total
photo submissions
!
• Conversion is over 50%
higher than site average
!
• Over 1.1 million loves on
our Style Gallery

36. Efflorescent Effect
Dress
Heart of the World
Bag
Too Much Fun Dress in
Black Dots
Installation Art Exhibit
Tank in Aqua Zigzag
Time for a bite
Necklace
Efflorescent Effect
Dress
Heart of the World
Bag
Too Much Fun Dress in
Black Dots
Installation Art Exhibit
Tank in Aqua Zigzag

37. Takeaways

38. SHE ENGAGES
SHE INFLUENCES
DATA ENABLES
PERSONALIZATION
SHE FEELS
OWNERSHIP
SHE VISITS

39. Takeaways
• Niche Start = Competitive Advantage &
Fundraising Disadvantage
!
• Niche Focus x Iterative Expansion = Scale
!
• Marriage of Art & Science = Lean Principles x
Creative Leadership x Analytical Course
Correction