1. December 3, 2013
By Adrianna Ryles, Hongqian Su, Chanjuan
Zhang, Xiaoshi Zhang
Alloy.com:
After IPO Marketing Analysis

2. Outline
• Competitive analysis
• Company differentiation strategy
• Recommendations
1. Acquisition, Retention, Reactivation
2. CLTV
• P & L statement
• Summary of recommendations

3. Competitive Analysis
• Direct competitors dELiAs, mXg
bluefly.com
• Indirect competitors The mall-based stores
Bolt.com, Seventeen, Twist and Jump

4. dELiAs Inc.
• The largest online
and catalog
merchant
• 20 conventional
retail stores
• Company website
Features
Threats
• Larger database
• Extended product lines
(ex: home furnishings)
• Online to Offline (O2O)
• Many touchpoints (online
magazine, other brands,
websites, Brick and
Mortar)

5. mXg Media Inc.
• A hybrid of catalog
and magazine
• Sponsor concerts
• Company website
• Sensitive to teen girls’
tastes
• Many touchpoints
(fashion shows,
concerts, website etc)
• Multiple distribution
channels (newstands
and bookstores)
Features Threats

6. Company Differentiation Strategy
• Catalogs
• Newsletters
• Events
• Contest
• Online ads
• Brand
recognition/awareness
(advertising creates the
most revenue)
• Customer engagement
• Constant
communication
• Extended database
Features
Strengths

7. Recommendation
• Catalogs/Email
• Online Ads: Banners, SEMAcquisition
• Email
• Event
• Contest
Retention
• Letters/EmailReactivation

8. $2,600,000
$1,400,000
$1,500,000
$2,000,000
$1,000,000
$1,000,000
$0
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
$3,500,000
$4,000,000
$4,500,000
$5,000,000
Acquisition Retention Reactivation
Catalogs Online Ads Email Events Contest Letters/Email

9. Launch Time

10. Acquisition
Sources Catalog (print)
Online Ads
(SEM,
Banner Ads)
New Customers 35,455 179,226
Response Rate 9% 3%
Prospects 393,939 6,288,640
# of efforts 12 9
VC/ effort $0.55 $0.02
Total Marketing Inv. $2,600,000 $1,400,000
Avg. Acquisition Cost $73 $8

11. Retention
Sources Email (E-Zine) Event-1 Event-2 Contest
# Renewed
Customers 501,958 486,099 446,477 395,340
Retention Rate 78% 68% 68% 60%
# Existing Customers 264,681 714,851 656,584 658,900
# of efforts 52 1 1 1
VC/ effort $0.15 $1.40 $1.52 $1.52
Total Marketing Inv. $2,000,000 $1,000,000 $1,000,000 $1,000,000
Avg. Retention Cost $3.98 $2.06 $2.24 $2.53

12. Reactivation
Source Letter/Email
# Reactivated Customers 660,000
Reactivation Rate 40%
# Lost Customers 1,650,000
# of efforts 1
VC/ effort $0.606
Total Marketing Inv. $1,000,000
Avg. Retention Cost $1.52

13. CLTV
Year Acquisition Year Second Year Third Year
2000 2001 2002
Customers 214,681 175,292 145,493
Retention Rate 82% 83% 85%
Orders per Year 3.8 4.4 4.6
Avg. Order Size 75 88 92
Total Revenue $60,379,031 $67,873,224 $61,572,513
Costs 48% 43% 41%
Cost of Good Sold $28,981,935 $29,185,486 $25,244,730
Acquisition/ Mkt.
Cost $19 $16 $12
Marketing Costs $4,000,000 $2,804,679 $1,745,912
Total Costs $32,981,935 $31,990,165 $26,990,643
Gross Profit $27,397,096 $35,883,059 $34,581,870
Discount Rate 1.14 1.30 1.48
New Present Value $24,032,541 $27,610,849 $23,341,777
Cumulative NPV
Profit $24,032,541 $51,643,389 $74,985,167
Customer LTV $111.95 $240.56 $349.29

14. P & L Statement

15. Thank You