Nasty Gals, an eBay boutique selling vintage clothes, was started in 2006 by Sophia Amoruso. Its customers are mainly 18-24 years old. Over time, it has grown from selling vintage clothing to a multi-category retailer. Eventually, Amoruso was challenged on where to venture next. She wonders if she should focus on product line expansion. She is also faced with the question of how she would be able to steadily apply the focus she had with Nasty Gals as it was expanding. With those issues and more, what steps should Sophia Amoruso take?
David J. Collis; Diane Chang; Matthew Shaffer; Ashley Hartman
Harvard Business School (715412-PDF-ENG)
Jan 7, 2015
Case questions answered:
- To what would you attribute Nasty Gals’ initial success?
- What factors contributed to the continued growth of the company?
- What were key issues (pain points) associated with company growth – if any?
- What are the key growth opportunities for Sophia at the time referenced in the article (2014)?
- What are the key challenges associated with these growth opportunities?
- Given what you have identified in questions 1-5 above, how would you recommend Sophia proceed? You can propose any combination of options presented in the case – or develop a completely new go-forward plan. It is critical that you provide your rationale for your recommendation. In putting together your recommendation, you may want to consider the questions posed in the case (i.e., you do NOT necessarily need to respond to these specifically):
- Should Sophia concentrate on product line expansion into lingerie, swimwear, cosmetics, and fragrances?
- Should she introduce a clothing line for women of Sophia’s age – now 29?
- How would a brick-and-mortar store impact the focus of the company or its ability to develop customized websites for overseas markets? How would wholesale distribution impact the company?
- Was #GirlBoss a smart marketing strategy to boost Nasty Gals’ sales or simply an unnecessary distraction?
- How would she maintain the detail and attention she had put into so many aspects of the company as Nasty Gals grew?
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Nasty Gals Do It Better Case Answers
1. To what would you attribute Nasty Gals’ initial success?
Nasty Gals’ initial success can be attributed to two things: (1) Authentic brand and (2) Strong customer loyalty through social media.
Authentic brand
Sophia started the Nasty Gal brand from a tiny shop on eBay that focused on vintage finds. Sophia maniacally focused on the details – photography, inventory selection, thumbnails on the listing, etc. This allowed the brand to be humanized through the strong, relatable voice of Sophia.
According to the case, Nasty Gal “embraced a fierce, provocative aesthetic for the body, confident younger self.” This strong, authentic brand empowered female consumers to seek out the brand and allowed Nasty Gal to grow organically.
Strong customer loyalty through social media
Nasty Gal’s initial success was based on smartly leveraging social networks and eBay to reach its audience. Sophia developed “ongoing conversations” with her customers through MySpace and eventually Facebook.
This one-to-one connection was critical for Nasty Gal to learn through trial and error what consumers wanted. By truly “listening” to consumers through social media, Sophia and Nasty Gal were adept at translating “likes into sales” in their first few years.
2. What factors contributed to the continued growth of the company?
Some of the biggest factors of the continued growth of Nasty Gals were (1) Expansion to non-vintage lines and designer brands, (2) poaching talented executives & venture-backed funding, and (3) advantages through inventory management.
Expansion to designer brands and other product categories
Nasty Gal turned to selling recognizable designers such as Sam Edelman, Mink Pink, UNIF, and Jeffrey Campbell, along with its core product offerings.
As the company grew, it ventured into other complementary items that fit well with its edgy brand. These extensions allowed the company to drive more revenue as a multi-category retailer – including third-party clothing, shoes, and its own private labels.
For example, Sophia launched her own line of shoes called “Shoe Cult,” which filled the space for fashion-forward shoes.
Poaching talented executives & venture-backed funding
Sophia reloaded her management team at Nasty Gal by bringing in top talent from other successful retailers – Deborah Benton from ShoeDazzle and industry veterans from Zappos and Urban Outfitters.
This was critical for growth as good talent can help push a company forward with strong leadership and oversight. Sophia also decided to take venture-backed funding…
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