Gilt Groupe Founders Gab About the Future of Commerce

Authors of new book discuss what's ahead for Gilt and online shopping

When Gilt Groupe co-founders Alexis Maybank and Alexandra Wilkis Wilson opened the virtual doors to their online flash sale site in 2007, they were thrilled to sell $9,565 in high-fashion fare on their first day. Now, the members-only site—which has since grown to include travel, food, home furnishings and local services—can generate far more than that in a matter of minutes. 

In their new book, By Invitation Only: How We Built Gilt and Changed the Way Millions Shop, which hits shelves today, the co-founders trace the story of their company's success and how, along with co-founders Kevin Ryan, Mike Bryzek and Phong Nguyen, they reinvented luxury shopping—online and off.  In a chat with Adweek, Maybank and Wilkis Wilson talk about their site's rapid rise and the road ahead.

Adweek: When you look back, when did you first feel like your vision of Gilt Groupe had materialized?

Alexandra Wilkis Wilson: There are two critical moments that stand out in my mind. Our first sale was a Zac Posen sale [on] Nov. 13, 2007, and we had no idea what to expect. We were five co-founders standing shoulder-to-shoulder in a very modest office space, and we had no idea if our customers were going to actually log on and shop. We were armed and prepared for a lot of customer service questions. But we were delighted to find that our customer was self-directed, she was vying for herself, she was not calling or emailing. She just trusted her instinct, loved the product, loved the prices. And she was shopping. That was very exciting. Another moment for us was several months later when Gilt Groupe was mentioned on the TV show The View and our membership more than doubled in a matter of hours.

AW: It was interesting to read that, initially, you didn’t see Gilt’s appeal as a marketing channel. You said that it first struck you during a conversation with a designer. Why do you think that didn’t occur to you first?

Alexis Maybank: We initially conceived of the idea as [an experience like] shopping at sample sales—a really exciting way to get an insider price and designer goods and you’re there for a certain amount of time. We just loved that. Even though that in itself was a new form of retail and a new way to market goods (mostly in Manhattan), we didn’t experience it that way. We really thought it would be more of a [vehicle for] our partners to move the inventory in a unique way online. It was through a call from Ron Berk (the CEO and husband of designer Judith Ripka) that we had somewhat of an "a-ha!" moment. [We realized] that this is actually a unique way to market to consumers online, especially for brands having trouble reaching consumers that aren't going to the store quite as often or that might perceive fashion and luxury brands as maybe not for them. It was really a unique way for many of our brands to connect with consumers online.

AW: You say Gilt also flipped consumer psychology on its head. How so?

AM: The big and exciting change in our model was the feeling that you had to move and act really quickly on making a purchase because it was fleeting. The retail model really was changed in the Gilt formula, which was act now, move quickly. We don’t have everything for everyone. We don’t have goods that are always here and available, and that was the typical norm within e-commerce—everything for everyone and lots and lots of selection. That psychological change was a big one, but effectively it made for a really exciting shopping experience.