Molson Hart

Metrics also provides the foundation to shift & shape their private label business which ends up being more productive on a units sold per style basis with higher average unit revenue & meaningfully higher gross margins vs. third party. It also keeps avg. order value high at $304

Of course, the question is how much performance marketing runway is left. How can they drive efficient growth? They've acknowledged CAC increases & gets less efficient as digital channel spend increases. Interestingly, they say influencer marketing has an opposite effect.

One thing they're done is deliberately increase marketing spend to higher-margin owned brands w a focus on acquiring "full price" customers who they believe has higher LTV. While CAC increased from $30 to $38, they still generate a profit on 1st order w higher contribution margin

Going forward, the big question is how will brand/influencer marketing drive growth. Revolve is considered one of the best at influencer marketing and in many ways are the "canary in the social marketing coal mine". If they can't make it work, a lot of DTC folks are in trouble.

Revolve is also a proxy for Insta's social commerce initiatives. They will be an early adopter to whatever Insta decides to pursue & will have clear, metrics-driven read into how things are progressing. In theory, Insta's commerce success should drive success at Revolve