According to Business of Fashion, Condé Nast has decided to close its first major experiment in online fashion retail, Style.com. The media giant will instead forge a new strategic partnership with e-commerce site Farfetch.
Style.com has discontinued operations effective immediately and any visitors to the site will now automatically be directed to Farfetch. The latter has acquired Style.com's trademark, intellectual property and its customer database.
The move by Condé Nast comes despite a rumoured $US100 million investment into the Style.com less than a year ago, which included the merging of fashion editorial with e-commerce to help revolutionise the way its readers shopped. It's thought that instead, Farfetch will commercialise Condé Nast's online and social media content and link the media company to its network of 200 luxury brands and 500 fashion boutiques around the world.
“Our experience with Style.com taught us that content is a powerful driver of commerce, and the combination of great editorial with a great shopping experience creates a great user experience and revenue upside,” Condé Nast general manager of digital strategy Matt Starker told The New York Times. He acknowledged, however, that the skill sets required to create content and those required to run a seamless shopping site were very different.
The New York Times also reports that with increased competition from blogs and online publications over the last decade, combined with an industrywide drop in ad spending, traditional magazine publishers are having to plan aggressively on cultivating new revenue streams – luxury e-commerce being a particular focus.
Farfetch surpassed gross sales of $US800 million in 2016, up 60 per cent from 2015 and has estimated annual revenues of around $US150 million. Accodring to BoF, the company is still losing money but its core marketplace product delivered significant underlying profitability.
