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Online gift retailer Red Envelope's (ticker: REDE) Q1 numbers and guidance disappointed the Street (as you'll see from the chart below). But CEO Alison May had interesting things to say on her May 17th conference call about Red Envelope's strategy to counter price competition on the Internet. Her remarks are now even more relevant after the announced acquisitions of comparison shopping sites Shopping.com and Shopzilla. Extracts:

In an online environment of competitive price-driven comparative shopping, we believe it remains important to offer customers proprietary gifts that cannot be found elsewhere… We specialize in meaningful gifts across 14 different product categories… which convey special sentiment to the recipient. The quality of the gifts, the personalized touch, the gift wrapping, story cards and gift cards, all contribute...

We recently introduced digital photo gifts where our customers can incorporate their own digital photos into our frames and distinctive products. We also introduced our “build-a-gift” concept where customers can choose from a variety of small gift items to create a customized gift box for the recipient… For Father's Day we are introducing a personalized bound photo book where the customers can go to our Site to create a photo album with captions and we will send a hard-bound book filled with professionally printed photos.

…We introduce approximately one third new products each season, keep one third dedicated to our assortment to our best sellers, and discontinue approximately one third of our products, which we generally sell on our site via normal sell-through or through special and sales pricing…

(Quotes are from the CCBN StreetEvents transcript.)


Source: Red Envelope on e-commerce strategy and comparison shopping (REDE)