In the cult classic role-playing computer game Dungeons and Dragons, players would often say, “Wow, Loot” (or rather, “Woot!”) after accomplishing a feat or coming across a good find. That said, it’s only fitting that one of the fastest-growing online retailers, Carrollton, Texas-based Woot, which brought in $117.2 million in revenue in 2007, not only centralizes its business model around good finds and deals, it has also developed a massive loyal following on its site,
Woot, which sports the tagline “One Day, One Deal,” was one of the first companies to embrace the deal-a-day business model on the Internet when it launched back in July 2004. The strategy has become so popular among consumers that many other companies have followed suit with similar initiatives. However, what sets Woot apart from others is not necessarily what the site does, but how it uniquely markets itself.
First, here is a rundown of how the site works: Woot offers only one item each day, usually in the electronics category. Merchandise ranges from a $9.99 pen collection to a $799 HDTV. Whether the product, which is always discounted, sells out early or remains in stock for the entire day, Woot doesn’t put up a new item for sale until the stroke of midnight (Central Time).
On rare occasions, the site will switch up its game during what it calls a “Woot-Off,” which is when a new item is replenished on the site once the previous product sells out. Woot-Offs, which can last up to 72 hours, usually draw in more than $1 million in sales and keep consumers glued to their monitors at all hours of the night.
Another promotion that keeps shoppers on the edge of their seats is Woot’s infamous blind grab-bag promotion, priced at a $1.00. Woot’s “Bag O’ Crap” usually contains inexpensive items, but on occasion, a lucky shopper might receive a large flat-screen television instead. For this promotion, the site instantly receives thousands of orders and the bag sells out in mere seconds.
Woot has since expanded into other markets: It has a site for daily T-shirt deals, another for wine and another with daily closeout deals in partnership with Yahoo! Shopping.
The success of the site is not only measured in sales, but also in its cult-following fan base. These devoted shoppers have even created a service called WootTV that hosts live discussions about daily Woot items. Another fan-developed service is Wootswap, which allows shoppers to swap Woot-purchased items with others.
Woot is thriving proof that a once little-known startup can become a huge online sensation with the right model to back it up.