ModCloth founders Susan Koger and Eric Koger met in high school. Susan enjoyed shopping for vintage clothing, and over time accumulated so many outfits that she decided to sell some. Eric, who was her boyfriend at the time, offered to build her a Web site to sell the clothes, so she decided to sell online. Susan saw this as way to help pay for college; this initial experience was the foundation for ModCloth’s birth.
Susan and Eric both attended Carnegie Mellon in Pittsburgh. ModCloth was a hobby business the first four years. Susan continued to accumulate women’s vintage clothing, sell them on her Web site, and ship orders from her dorm room. The “customer care”
number on the Web site and boxes was her cell phone number. After graduating in 2006, Susan decided to focus on ModCloth full-time. Eric remained at Carnegie Mellon an extra year to earn an MBA. To make ModCloth a full-time pursuit, Susan broadened her thinking. Up until this point, the only clothes that ModCloth sold were vintage clothing that Susan picked out. She started attending trade shows to make contact with independent designers who designed and made vintage-inspired clothing, which is a much bigger market than vintage clothing. She knew that to appreciably grow ModCloth she’d have to move beyond the small vintage clothing niche and broaden her product line.
To make sure she was on the right track, Susan surveyed 100 of her customers to ask if they’d buy vintage-inspired clothing from ModCloth, along with the vintage clothing the company carried. A total of 95 out of 100 customers surveyed said they would.
Armed with this information, Susan approached two or her uncles and raised $20,000 in seed funding to buy inventory. She could now expand ModCloth’s product offerings to include both vintage clothing and vintageinspired clothing.
Fast-forward to the present. In the six years following Susan’s ability to raise equity funding from her uncles, ModCloth has grown to a 200-person company.
The firm just experienced four years of back-to-back 600 percent per year annual growth. The company is profitable, and over 2 million unique visitors visit its Web site every month. It’s raised two rounds of venture capital funding, including a $19.8 million Series B round in June 2010.
A large part of ModCloth’s success is attributed to its marketing program. Although it’s strictly an online retailer, the 4Ps—product, promotions, place (distribution), and price—have played an integral role in its success. The following is a discussion of ModCloth’s 4Ps. The discussion highlights elements of the 4Ps that have contributed to ModCloth’s success and illustrates future challenges for the firm.

Discussion Questions
1. In a short paragraph, describe ModCloth’s brand.
Comment on the strengths and weaknesses of the brand.
2. What is the difference between ModCloth’s core product and its actual product? Describe its actual product and your assessment of whether the actual product provides an attractive mix of characteristics.
3. In what ways, if any, do you think ModCloth will look different five years from now than it looks today?
4. Follow ModCloth’s primary Twitter account (ModCloth) for five days. Write a short summary of how ModCloth uses Twitter to engage its customers and promote its products. One a scale of 1 to 10 (10 is high), rate how effectively ModCloth uses Twitter as a promotional tool.

Application Questions
1. Comment on ModCloth’s “Be the Buyer” program. To what degree do you think this program plays an integral role in ModCloth’s ability to create an emotional connection with its customers? In addition to the Be the Buyer program, make a list of the ways in which ModCloth engages and creates a connection with its customers.
2. What online retailers, in addition to ModCloth, use crowdsourcing to determine what to sell? Compare ModCloth’s approach to crowdsourcing to at least two other companies you identify.