An online retailer of off-price designer clothes, accessories, and housewares, Bluefly provides a fix for those with Prada tastes but Kmart budgets. Its web site offers a dizzying amount of merchandise, separated into six categories: womens, mens, teens, kids, housewares, and gifts. Kenneth Seiff started Bluefly in March 1998, folding his golf apparel company Pivot Rules (which had gone public just a year earlier). His new site launched in September 1998, rolling out merchandise that became an immediate hit among label-conscious bargain hunters.

No seconds at Bluefly

Bluefly differs in one respect from its brick-and-mortar outlet cousins: it only offers first-quality merchandise, which it buys both directly from the designers and from resellers at wholesale. (Outlets usually sell factory seconds and irregulars in addition to top-quality goods.) Bluefly sells products from 200-plus designer labels, including Gucci, Calvin Klein, Diesel, and Donna Karan, at prices of up to 75 percent off retail.

An infusion of $10 million in capital from financier George Soros in July 1999 and another $15 million in early 2000 helped Bluefly solidify its standing as a premier online retailer and a legitimate competitor of heavyweights such as Fashionmall.com, Macys.com, and Nordstrom.com. The company is betting that consumers will get over their fears of buying clothes on the Web with a 90-day money-back guarantee. Still, it remains to be seen whether enough customers will enable Bluefly to fly into the black in the near future. To help ensure its continued success, Blufly has incorporated a series of strategic practices. In addition to the popular "My Catalog," which allows users to customize their search by selecting items by size, brand, style, or price, the company will be implementing an e-mail service to notify customers about newly available products of interest. Bluefly has also secured exclusive content deals with major magazines such as Marie Claire, Esquire, and Seventeen, as well as Internet portal relationships with MSN.com, theglobe.com, Warner Brothers, and Alloy. Consumers can expect a Bluefy-First USA co-branded Platinum Visa credit card in the near future as well.

How Fly are the Flyreps?

Bluefly makes every effort to deliver to customers a more personal Internet shopping experience. Therefore, it trains its flyreps to be more of a personal shopper than a mere order taker. This can mean extremely long hours over the holidays, but Bluefly tries to ease that pain by encouraging frequent breaks and offering soft lighting, which supposedly has a calming effect. The mostly 20- to 30-year-old workers at Bluefly seem unaunanimous in their embodyment of the "work hard, play hard" philosphy shared by many dot.coms.

Those flyreps and the rest of Bluefly must be doing something right, since, at the end of 1999, Media Metrix named Bluefly the No. 3 apparel-retail site in sales. Power Rankings issued by Forrester Research ranked Bluefly as the third-best apparel site overall and the No. 1 apparel site in terms of ease of use and customer friendliness. While the company is unsure of when it might make a profit, Bluefly continues to generate business, as well as interest.

The MSN.com Butterfly