You’ve probably heard about a growing trend called flash sales sites. There has been an emergence of these eRetailers, such as Gilt and Zulily, specializing in selling products to the eager shopper looking for items in fashion, consumer electronics, home décor and more. But what exactly is a flash sale and why are they so successful? A flash sale is an e-commerce business model in which a website offers a specific number of products for sale for a limited time only, typically at a highly discounted price. This business model has a large following with a never-ending supply of companies wanting to be the next prominent player on the market.

The History of Flash Sales

The early success of flash sales can be credited to the economic recession that lead shoppers on a hunt for the best discounts they could find. It all began in the brick-and-mortar retailing category, with stores such as Dollar General and TJ Maxx, specializing in “close-out” sales. The items would be purchased from a variety of retailers with a large quantity of products that went unsold in previous shopping seasons. Instead of establishing their own operations with hopes of depleting their inventory and still making a profit, it made more sense to ship them off to a flash sales company. These companies then sell the products at a price significantly lower than the original value. After the success of the brick-and-mortar stores, a surge of e-retailers found that they could do the exact same thing for online shoppers. Initially, they followed the same business model by purchasing out-of-season or unsold items in bulk and selling them at a discounted price but eventually the industry began to change. Instead of being primarily “close-out” driven, these eRetailers began carrying more exclusive, high-end brands. This developed into a new sales channel, creating opportunities for new and existing retailers to grow their business.

eRetailers and the Success of Flash Sales

With the flash sales scene in a constant state of change, the most successful sites offer products for everyone; men, women, children, active, electronics, home goods and more! Gilt is one of those market leaders that has products listed for a few days with another set of products in line to replace them as soon as the sale period ends. This rotation gives the consumers an online shopping experience that is fresh and appeals to those looking for diverse selections.

Another attributing factor to the success of these flash sales is the feeling of exclusivity that members have. As previously mentioned, one of the most popular flash sales sites today is Zulily; targeted to mothers and children, they offer an array of clothes, jewelry, shoes, toys, etc. at extremely cheap prices. The only requirement to be a member is a simple sign-up process. Naturally, you receive daily emails with reminders of new on-sale products or existing sales that are close to expiring, but that’s it! Even something as simple as that makes consumers feel as if they belong and in turn generates more profit for the company.

Flash sale retailers are merging into a very pronounced niche market. With front runners like Zulily and Gilt, the amount of notable contenders has been slimming down but this business model is certainly here to stay. The most successful eRetailers offer a variety of items at highly discounted prices to their members for a specified amount of time.

What types of flash sales sites are you a member of? Do you consistently turn to them for your daily needs?

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