A year after its IPO, Stitch Fix keeps pulling revenue out of the box
Stitch Fix’s stock jumped 14% after it beat expectations and announced a new line for kids, and it’s shaping up to be one of the few subscription boxes that can stand on its own.When the subscription clothing company went public a year ago, critics doubted the company’s prospects. But, so far, the company has proved the haters wrong — a win for AI-driven style curation, female tech founders, and your closet.
The ’Fix knows it looks great
After raising $120m in its IPO last year, Stitch Fix tried on a few different tactics in its first public quarters — but it finally found one that looks goooood… The company increased its revenue 29% and grew its customer base 30% in the past year — beating Wall Street’s quarterly estimate by more than $10m.So how did Stitch Fix founder and CEO Katrina Lake and her 50% female executive team pull such a big win out of the box?
The company Stitched together multiple threads for a perfect fit
Stitch Fix uses AI for efficiency and a human touch for personalization — giving it a competitive advantage over physical stores and e-commerce giants alike.After its IPO, Stitch Fix doubled down on its hybrid advantage by hiring an experienced, hotshot CMO and continuing to respond to consumers with lines like Plus Sizes and Kids.Stitch Fix’s combination of AI and human stylists garnered widespread praise — and the sincerest form of flattery (imitation) from some dangerous competitors.
The subscription box that’s beating the odds
Other boxes copied Stitch Fix’s model, but none could unbox consistent revenue. Competitor Trunk Club sold out to Nordstrom for just $350m — Stitch Fix, in contrast, did $1B in sales in 2017. But the bigger key to Stitch Fix’s success is its immunity to the e-commerce angel of death, Amazon. The newly created Amazon Wardrobe mimics many of Stitch Fix’s features, but Lake is not concerned about the e-commerce giant, telling Bloomberg “we’re not in a place where we’re competing with Amazon.”
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