That's right, the home is now the fastest-growing sales outlet for apparel, footwear and accessories, a burgeoning $10 billion industry created by apparel and accessories marketers catering to consumers from the comfort of a friend's couch. According to NPD Group's chief industry analyst, Marshal Cohen, more than 5% of consumers report they have attended a home party for fashion in 2005, a five-fold increase from 1% in 2000.
"If I was a brand today, I would absolutely make sure that home-marketing was part of my sales equation," Mr. Cohen said. After all, he noted, 82% of women now state that shopping is a chore, and with less time to shop, fewer funds to shop with and nearly no personal attention from traditional retail channels, the social home-party setting is sure to stand out and make shopping fun again.
Though the direct-selling trend has been built mainly on the backs of smaller start-up companies over the last few years, the success and hominess of home marketing is now on the radar of bigger fashion players such as Jones Apparel Group, which in March launched accessories line Million Wishes, its first brand to be sold via a nationwide party program.
Jones, the owner of venerable fashion brands such as Jones New York and Nine West, conducted focus groups among women who, according to Million Wishes President Betty Palm, told the company, "I wish I had someone to help me edit the trends each season and have a personal shopper." As a result, Jones began a test in October using 22 independent style consultants to showcase a line of on-trend jewelry, handbags, belts and belt buckles for exclusive sale at home parties. The test, Ms. Palm said, "exceeded our expectations in terms of average party size and the fun women had." Jones promptly expanded the concept to include a growing network of more than 200 consultants in 38 states.
Patty McBride, a 22-year direct-sales veteran brought on as a founding leader and recruiter for Million Wishes, said the deep pockets of a big backer makes it easier for consultants to sell, offering consultants their own Web site and a kit complete with a training DVD, catalogs and party invitations. Average sales for a party are expected to run around $650, she said. For Million Wishes, the party thrower keeps between 25% and 35% of sales.
And unlike most other home-party hawkers, Jones advertises. Using the tagline "Friends and trends" to play up the socialization aspect of the brand, Jones has developed ads consultants can download for use in local papers. Million Wishes is also working with Jones' marketing department to put together a national ad plan for September magazines that appeal to its broad female target.
Jones' effort is likely a response to the many smaller marketers, often entrepreneurial stay-at-home moms who have successfully built their brands through home parties. Beijo, a handbag company founded by stay-at-home mom Susan Handley three years ago, had sales of roughly $20 million last year mainly from home parties. Shade Clothing, a line kicked off in 2004 by two Utah moms aimed at Mormon women uncomfortable with belly-revealing styles, has hit it off beyond the Latter Day Saints crowd as word of Shade parties spread to modest women across the country. Char Garn, Shade's chief operating officer and owner, said the company's sales from roughly 1,000 or so parties last year totaled $4.6 million.
The company has added roughly 30 representatives (for a total of 90) and five full-time recruiters this year as part of a new nationwide Personal Shopper program intended to spur that growth further.
New businesses crop up every day, with small overhead and built-in marketing networks of the playground and PTA set providing incentive.
Calling from a cellphone on the way to her son's soccer practice, Jane Cournan, founder of online accessories company Frosted Brownie, said the company's sales last year-its first full year-totaled $150,000, mostly from parties she and her former partner set up. Although she used to run a regular bricks-and-mortar store, three kids later that proved impossible and now she sets up mini boutiques in friends' homes across Connecticut, Massachusetts, New York and Rhode Island, supplementing word-of-mouth interest sparked between parties with Internet sales.
The hundreds of companies such as Ms. Cournan's that suburban women are now happily inundated with are taking their toll most directly on the luxury market and specialty boutiques, NPD's Mr. Cohen said. "Scoop in New York is selling $250 jeans in its store, but if they have a competitor selling at a party in their apartment with 50 friends a block away, that's much more fun," he said.
The reality, though, is that direct sales, however fun and homey, will never replace the more traditional options, said Amy Robinson, a spokeswoman for the Direct Selling Association, a trade association for the $30 billion-a-year industry that makes up a mere 1% of total U.S. product sales.
For Boden, a U.K.-based catalog and Internet company for women's, men's and children's apparel, using a network of roughly 40 representatives around the U.S. is a great way to add names to its database and drive awareness. Susan Weinreb, a New Jersey mom, recently signed on to represent Boden and its kids' line, Mini Boden, and has sold about $17,000 in merchandise through five shows. Her commission, she said, is based on whether purchasers are new or existing Boden consumers. "My job is to mine the fields and find new people so Boden can get more customers. Once you've bought something, they have your name and address, and it's a way to sell their catalog business," Ms. Weinreb said.
Of course, what makes parties in general so successful, she said, is that they make shopping entertaining and easy, especially for children's clothes. A rep for years for a former kids' clothing company, Big Enough, she said, "Moms don't worry about kids having a fit in the middle of the mall. Kids can sit and watch Nickelodeon while their moms try samples on them." And, if you do the party in the evening, it's a girls' night out, a big selling point for weary caregivers. The biggest allure of a personal representative, though, is service. Ms. Weinreb, for example, offers buyers a beautiful return option: "Drop it on my doorstep," she tells them "and I'll send it back."