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Zulily
Based in
Seattle, Washington, United States
Delivery, E-Commerce, Retail
B2C
Online retailer that offers consumers with daily product deals
Acquired
Attended an Accelerator
Dates
Launch
1 January 2009
Closure
1 January 2014
Duration (months)
5 years
Failure
Reason
The main culprit for the downfall of the popularity of Zulily is poor marketing and user-attention strategies. Most notably, in order to access the search engine and databases of Zulily's shopping items, the platform required from new visitors to give their email address prior to even seeing what the online store had to offer. This marketing trick met with a lot of criticism since it violated some basic marketing principles. Zulily initially achieved a record success with the number of new subscribers who registered on the site, but Zulily team soon noticed that sales began rapidly to decline. People gave their mail only to peek at the site and registered users couldn't necessarily be considered loyal or even willing customers. Zulily inadequate marketing strategy and front-page email request discouraged thousands of potential new customers to sign up, while their existing users often bought only once or anyway not enough to sustain the financial stability of the company. Users also stated that they felt overwhelmed by the number of merchandise and flash sales invitation the e-shop offered so the company complied by diminishing them, and a decrease in revenue also followed. Moreover, although Zulily sometimes offered brand names for ridiculously small prices, there would often be longer than expected delivery times to customers which also earned them poor reviews.
Submitted Failure Story
Failure categories
User Retention Difficulties
Poor marketing
Founders and team
Investment
Number of investors
8
Investors
Andreessen Horowitz, Trinity Ventures, August Capital, Meritech Capital Partners, Maveron, Alibaba Group, Greenspring Associates, Mark Vadon
Accelerator program
-
Acquisition status
Acquired by QVC for $2.4B
Acquisition date
17 August 2015
Employee count
1001-5000
Founders
Darrell Cavens, Mark Vadon
Founders Twitter
Funding
Total funding
$194,600,000
Number of funding rounds
5
Funding round(s) amount(s)
Series A - $4,600,000, Series B - $6,000,000, Series C - $43,000,000, Series D - $85,000,000, Post-IPO Equity - $56,000,000
Last funding
$194,600,000
Last funding date
10 May 2015
Last funding type
Post-IPO Equity
Funding Status
M&A
Online
Website
Public synopsis
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