Luxury Shoe Club Launches: Co-Founder Scott Van Valkenburgh Discusses Its Unique Retail Tech
A new way for shoppers to buy and sell pre-owned luxury shoes has hit retail. Luxury Shoe Club (LSC) just launched its new membership club, iPhone app and next-generation shoe-trading platform. The trading club for pre-owned designer shoes has a unique model, which lets members get designer shoes at a fraction of the retail price and pays them upfront to sell shoes they no longer wear.
Co-founder Scott Van Valkenburgh, LSC, who has a strong tech background in systems design and analytics, knew there had to be a better way for shoe lovers to purchase designer shoes.
“When I saw how much it cost women to sell their shoes on consignment sites like The Real Real and the pain and hassle of eBay and Craigslist, I wondered why women who have the same shoe size couldn't just trade the shoes they no longer wear with each other,” says Valkenburgh.
Luxury Shoe Club differs from competing services by using a Club Point system for shoe trading. Members buy and sell shoes using points instead of cash. Each Club Point is valued at one US dollar. When a member lists a pair of shoes for sale, LSC’s uses its proprietary pricing algorithm to determine the shoe’s fair market resale value and then instantly pays up to 50% of that value to the listing member. The remaining amount is paid once the shoes are bought. This unique model allows members to immediately earn points to shop members’ shoes closets without having to wait until their shoes sell.
"The concept behind the creation and usage of points was to have a fair way for members to trade shoes without having to trade a shoe for a shoe," Valkenburgh tells RIS. "The Club Point system (1 Club Point = $1 in value) allows members to have a way to measure the fair market value for the shoes they list and, the unique part is, get paid up to 50% of their value upfront and use those points to shop for other members shoes. This let’s all club members get great shoes at a fraction of the cost."
Obviously a lot of effort goes into designing such a retail model. RIS had the chance to catch up with Valkenburgh to learn more about the retail technology that went into creating the membership club, app and next-gen shoe-trading platform.
LSC's front-end is built as a mobile app only to leverage these devices built-in capabilities for optimal UX design, camera, touchscreen and 3rd party app interoperability. The back-end is custom built on AWS using js.node, Docker containers and Mongo DB. All of components in the app such as shoe pricing, shipping, message, etc. are built as stand-alone micro-services that are API driven and can be modified independently.
"This design allows robust scalability, flexibility, reliability and responsiveness that is very cost-effective to run and automatically expands as usage grows," Valkenburgh tells RIS.
Creating a pricing algorithm for the resale value for shoes, however, was definitely a challenge, he says.
"Unfortunately there is not a lot of common structured data about designer shoe types, styles, brands, names, age, pricing, etc. We had to scrape data from over 100,000 pre-owned shoes for sale on the internet, classify the data into common categories and develop a pricing algorithm based on the data to create a very accurate resale value. This took several months to refine and tweak to get the accuracy levels we have achieved."
Memberships to LSC also offer some perks, beyond the ability to buy and sell shoes. Personalized shopping, express shipping, free shipping boxes, at home pickup and a 7-day return policy are a few of the features that the three membership levels offer. Depending on the membership level, Intrigued ($49/year), Passionate ($99/year), or Obsessed ($149/year), benefits include bonus Club Points for shopping, savings on Club Point purchases, discounts on shoe repair and polishing, as well as free shipping for shoe purchases.
Logistically, getting express shipping options and at home pickup off the ground takes teamwork.
"It’s all about partnerships," says Valkenburgh. "We were lucky enough to have connected with the founder of Endicia who helped us create and establish our shipping capabilities for members that lets them create pre-paid and printable labels from the LSC App and ship directly to each other. In addition they connected us to a specialized e-commerce team in USPS that helped us integrate our technologies with them to allow 1-touch next day pick-up from our app and also order and send complimentary priority mail shipping boxes to their homes when they join."
Personalized shopping is another must-have in today's e-commerce retail environment. When members join LSC they share their shoe preferences by size, brand, style, colors, etc. A "For You" section in the app highlights shoes that match these preferences.
"As the members interact more we capture this data and in the future will be giving even more personalized recommendations based on their past usage," explains Valkenburgh.
Valkenburgh advises building an e-commerce first business takes a lot of patience and learning.
"First and foremost, you need a useful product or service and from there you need to build and understand how the technology, data and analytics can combine to build a business that scales," he says. "If you can make this happen and you can have insights into how users behave, what they see as valuable, and can easily adjust the technology, you’ll have a great chance to succeed. If you’re stuck without these in place, you really will have a tough time to be agile and adjust quickly enough."