Fab Presents Madonna: Smile, you're designed to dance.
When Madonna’s team started talking to us about the idea of helping launch Madonna’s new album MDNA on Fab, we were ummmm in awe.
At Fab, we strive to offer our members unique access to great designers and artists, both emerging and iconic.
We’re thrilled and humbled to now include Madonna among them. Our Fab members have done so much for us the past 9 months, spreading the word about our products to the tune of 3 million people joining Fab, 50% from social media.
Thanks to the enthusiasm of our members, we’ve sold more than 1 million products already and we’re hands-down the leading innovator at the intersection of commerce, content, and social. And, we’re still just getting started.
On Fab’s first day of sales, June 9, 2011, we sold $60,000 worth of design products. We’ve been off to the races ever since.
While some might consider that an overnight success, the real story is that June 9, 2011 was day 474 of our work on this company. It took lots of failure and learning to finally get it right; and one giant mother-of-all pivots.
Since the beginning of 2012 we noticed that “has mobile app” is a big indicator of customer engagement. We saw that Fab’s mobile users purchased more then 2x faster, 3x more often, and in much larger basket sizes than web-only customers.
A few weeks back we started to notice that iPad users behaved exceptionally differently from all other mobile users and web users.
To dig in deeper, we engaged Custora to analyze and project out the lifetime value of an iPad customer. Custora is a software-as-a-service that analyzes historical user and order data and then develops bayesian probability models to forecast customer lifetime value.
The predictions regarding the value of a Fab iPad customer are striking.
First, the Custora model shows that iPad customers convert to making their first purchase exponentially greater than non-iPad users, to the tune of >40% making a purchase by month 3 and >70% making a purchase with 7 months of joining.
￼A lot of really good businesses build their business model around getting to 10% conversion rate to purchasers within 6 to 12 months. It’s simply amazing that we’re seeing 10% conversion to purchase within the first week for iPad users.
Second, the Custora model forecasts that iPad users are worth twice as much 2-year revenue vs. non-iPad customers.
Third, while 15% of Fab’s purchasers currently use our iPad app, those 15% are forecasted to generate 25% of our revenue over the next 2 years.
What does all this mean?
Here are some possible explanations:
The Fab iPad shopping experience is just more conducive to purchasing. The Fab iPad experience focuses in on browsing one product at a time while the Fab web experience allows the user to more easily browse across multiple sales and products.
The tactile touch experience of the iPad more closely resembles being able to physically “touch” a product like physical-world shopping vs. the web which can feel more distant when browsing with a mouse or track-pad.
iPad users are just more likely to be design lovers.
iPad users have more disposable income.
Our hunch is the answer is some combination of all of the above. We’ll be digging in even deeper to learn more.
Or, maybe we should just buy all of our users an iPad? ;-)
Fab Welcomes Scott Ballantyne as Global Chief Marketing Officer
We’ve got a simple formula at Fab: Find one thing you can be the best at and do that one thing better than anyone else in the world.
Our one thing is design. We’re on a mission to establish Fab as the world’s most valuable design resource. We believe that that’s an Amazon-sized business opportunity. Yes, we’ve got big ambitions.
Our brand goal is to make Fab synonymous with design. We want people to think design and think Fab, think Fab and think design.
With that goal in mind, we recently set out to find a Chief Marketing Officer who could take over Fab’s marketing from myself so I can focus more on what I do best, product. Today, Fab has achieved more than 2.5 million members in less than 9 months. We’ve just had our best month ever in February, beating our stretch plan by 25% and selling even more than we did during the holidays - in a short month! We went looking for a seasoned marketing exec with a well-designed blend of analytics, brand building, and humor, who could take our already torrid growth and accelerate it even further. And, especially, someone who just gets shit done.
We’re thrilled to announce that Scott Ballantyne is joining Fab as our Global Chief Marketing Officer.
I’ve known Scott for 10 years now, ever since I worked with him on launching Blackberries at T-Mobile back in 2002. Since then I’ve gone on to start companies and Scott’s gone on to build global brands. Throughout, we’ve stayed in touch, celebrated each other’s progress, and developed a deep professional friendship and mutual respect and admiration.
Scott Ballantyne is a globally respected senior marketing executive. He has 25 years international customer acquisition and brand building experience in both large and niche brands, consumer facing and enterprise categories and he has lived and worked in 3 continents.
For the last year, Scott was the Chief Marketing Officer of NYSE listed Vonage. There, he delivered annual subscriber growth of 8% in a tough market while reducing the overall cost of acquisition by 12%. Most recently he launched Vonage on iPhone and Android, and the Vonage Extensions product - extending the unlimited international calling value proposition to subscribers mobile phone. He also built 3000 new retail POPs by deals cemented with Best Buy, K-Mart and Sears.
Immediately prior to Vonage, Scott was SVP at Tendril, a Venture-funded Clean Energy start-up in Boulder, CO. As a key member of the leadership team Scott was responsible for the overall consumer and enterprise value proposition creation, development and deployment. During his time at Tendril he grew revenues 300%, won 8 of 9 GLOBAL RFPs in which Tendril bid, and won best-in-show at world’s largest energy show.
Before Tendril, Scott was the VP & GM of North American consumer-direct for HP’s PSG division. In this capacity he had full P&L responsibility. Major accomplishments included: Growth in the business from $500M to more than $800M in less than 2 years, taking the division from losing money to a Net income profit of 8%, and driving 20% out of the marketing budget by investing in more efficient marketing vehicles and channels.
As noted, Scott also is a former SVP Marketing at T-Mobile USA where his number 1 accomplishment was driving the highest volume of RIM Blackberry sales than any other wireless carrier in the world. Through relentless customer-insight gathering his team produced the 1st “Blackberry for the masses” and drove sales, ARPU and LTV higher than any other single device in the company’s portfolio.
Scott also has experience with start-ups and new product offerings at Asia Global Crossing, Dell and Motorola. At Dell, for example, he led the charge that took Dell from 6th place in global marketshare in the Laptop category to 1st in less than 18 months.
Alright, alright, I can go on and on forever. Short story is that Scott’s awesome. He’s got the right mix of experience, passion and charisma. He’s Fab.
Exactly 1 year ago Bradford and I went to our Board of Directors and requested approval for us to shut down our 150,000-member social network, scrap everything, and restart from scratch on an entirely new business.
1 year later it looks like we may have made the right choice.
It all began with a simple drawing on a napkin (and a great dinner with a lot of wine). We had decided that we were going to pick One Thing and do that one thing and only that one thing better than anyone else in the world. We found our One Thing at the intersection of:
What we are most passionate about
What we believed we can realistically be the best in the world at
What we were certain could develop into a big business in a market ripe for disruption.
It took us all of about 5 minutes to realize that Our One Thing is Design.
And, following a 20 minute board meeting 1-year ago today, Fab.com was reborn.
Since then, we’ve been doing our One Thing and loving every minute of it.
Fab’s new Weekly Shops, launched in mid-Feb, already contributed more than 10% of our overall sales in February 2012.
Repeat purchasers continue to make up 2/3 of each week’s Fab purchases.
More than 25,000 of Fab’s customers have already made 5 or more Fab purchases.
Fab’s social shopping integrations with Facebook is driving viral activity. 15% of Fab’s daily traffic comes from Facebook and our Facebook visits have doubled since December.
We acquired Casacanda in Germany and relaunched it as Fab.de, as the first step towards taking Fab around the globe. We believe that good design is made in all parts of the world and that everyone everywhere can benefit from good design.
We continue to pick products to feature on Fab based on what we love and what we think will make people smile, not based on sales. This is an emotional business. Our approach remains: Pick out products that make people smile; if they like it, we’ll sell lot’s of stuff over time.
We continue to keep it real. Fab is all about good design. We’re true to our design partners and the objects they create.
We continue to drive real business for our design partners as we create the worlds most valuable design marketplace. Thousands of designers have made business-changing money on Fab. Hundreds have sold more in a week on Fab than they would otherwise in months. The whole thing is so humbling and inspiring.
We are designing a workforce and a workplace for success. We’ve gone from 4 fulltime employees in NY at this time last year to 200+ people working on Fab worldwide in NY, Berlin, Pune, and Deinze, all while fostering Fab as a kooky culture of excellence and fun. You’d think that a business rising as fast as ours would be all about celebrating success. We do celebrate success, but we just as enthusiastically celebrate our challenges and push ourselves to do more and better.
We’ve developed a simple formula that seems to be working ok, but we’re ever trying to improve on: A beautifully designed website and app, featuring beautifully designed products, backed up by beautiful service. It’s not perfect, so we challenge ourselves every day to make it better and better.
And, we’re just getting started.
Much, much more to come. As we’re known for, Fab.com will continue to be the leading innovator in e-commerce 2.0. This is just the beginning of a long journey we’re on to build Fab into the world’s leading design resource. As I’ve noted, we have big Amazon-scale plans for Fab: We’re building a business for the decades. This is just 1 year into working on it and 9 months into operating it.
Our One Thing: Fab.com is design.
Thank you to everyone who believed in us, helped us and supported us the last 365 days.