A new web site, Eve.com, is set to launch this summer in an attempt to cash in on the online market for cosmetics and personal care, which it estimates will reach $1 billion by 2003.
The start-up has already raised $3.2 million in its first round of funding from Idealab, Menlo Ventures and Charter Venture Capital. Bill Gross, Idealab's founder and chief executive, said he listened to Eve.com's strategy for 90 minutes before deciding to invest.
"After a few years in this business, I've learned that making instinctive decisions is the best way to make an investment," Gross said. He has already invested in a number of ecommerce sites such as eToys, WeddingChannel and CitySearch.
Mariam Naficy and Varsha Rao, co founders of the site, came up with the concept in June 1998, and have since been building it, hiring executives from the traditional cosmetics industry and creating a board of directors that include Idealab's Gross, and Marleen McDaniel, Women.com's chief executive.
The site will sell top brand cosmetics and fragrances that, according to the founders, are targeted at "busy professionals, who travel four days a week and read all about the new products in fashion magazines, but never get to a department store".
It has already signed up such brands as Philosophy, Benefit, Vincent Longo, Calvin Klein, Givenchy, Jil Sander and Orlane, and has limited exclusive agreements with them. This enables the vendors to sell their products through department stores, but not via Eve.com's major online competitors such as Cosmetics Counter.
The founders also plan to differentiate their site by offering a search function to enable women to quickly locate products that meet criteria such as oil free and hypoallergenic and by providing personal advice and tips.
A recent study, "Conventional Wisdom About Women and Internet Use," which was carried out under the direction of Professor Donna Hoffman at Vanderbilt University, found that women shop online because they find it is convenient and provides them with discounts not available from traditional outlets.
They rated the "24 hour availability, speed and ability to compare prices easily," of Web shopping the most highly.
Lisa Allen, an analyst with Forrester Research, said: "Any business tapping the online women's market these days will need to be innovative and develop strong content, utility and an advertising base."
Source: VNU Newswire
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