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TheStandard.com: Shop Here - Everyone's Doing It
June 04, 2001Posted by Mandy  
Thanks to Desha for this :)

I got this in my mail today. Mentions a little blurb about Roswell.

TheStandard.com
Shop Here - Everyone's Doing It
By Anita Chabria


What do alien-themed TV shows, teen fiction novels and BMX biking have in
common? They're all the subjects of media channels that online retailer
Alloy.com is touting to push it's teen-centric image and drive commerce to
its Internet stores.


The New York-based company is quietly building itself into a media
powerhouse with magazine titles, catalogs, books and TV pitches that blur
the site's already murky line between editorial and advertising. At the same
time, Alloy hopes to convince teens -- who accounted for $155 billion in
spending last year -- that its site is more than just a store, it's the
place to find out what's hot, what's cool and what's up.

"The shopping experience for a teen is so much more than going into a store
and buying something," says Michael Wood, VP of Chicago-based Teen Research
Unlimited. "There is always a social aspect."

According to Alloy CEO Matt Diamond, that social aspect of teen shopping is
the core of Alloy's strategy, a strategy that has helped the company beat
analyst's earnings expectations for the past eight quarters, an enviable
achievement in the downtrodden dot-com sector.

While building online communities has for the most part become passé in the
online world, "with teens it seems to work," says eMarketer analyst Jonathan
Jackson. But teen communities are often based on the perception of coolness
-- which is where Alloy's media holdings enter the picture.

"To be a successful Web company, you need to be a successful media company,"
says Diamond. "Our job is to be a distributor for what kids like."

Along with distributing trendy clothes and accessories at allowance-friendly
prices, Alloy has become a specialist in pumping out the kind of content
that seems to fascinate high-schoolers - from celebrity gossip to fashion
trends and hip serial novels. The company sends out about 45 million
catalogs a year under the Alloy brand and under CSS, an extreme-sports title
targeted at boys. Through the CSS.com Web site and Strength magazine, Alloy
targets teen boys with interests in extreme sports such as skateboarding and
BMX biking. Alloygirl magazine, a partnership with Scholastic, targets the
female demographic with a classic format that includes relationship advice
and horoscopes. And Alloy's fiction book department, 17th Street
Productions, creates original titles that are branded with the Alloy name
and sold through major retailers such as Barnes & Noble. The company even
boasts a TV credit. Roswell, a series airing on the WB Network, was o!
riginally a 17th St. Productions book.

Alloy's mixed-media messaging seems to be working. The company has
accumulated a database of 6.6 million people, 1.5 million of whom have made
a purchase at the site. Alloy also saw its revenues increase 169 percent
last year to $91.2 million, up from about $34 million in 1999. Alloy hopes
to draw $145 million in revenues in 2001, according to Diamond.

In addition, with 80 percent of Alloy's revenues coming from e-commerce, the
company has attracted major advertisers such as Eastman Kodak and Coca-Cola,
and its stock continues to get positive ratings from analysts at a time when
most Internet retailers are struggling to remain listed on the stock
exchanges.

But Alloy's biggest risk might be becoming too slick at marketing itself.
Teens, says Wood, are a savvy audience and can smell an advertorial a mile
away. Too much marketing might be perceived as "uncool."

"They're very sophisticated," Wood says of teen shoppers. "They can see
right through that stuff."

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