I know there is a whole lot of noise in the online sales arena – large players, segmented players, acquired players. I began following the space closely when the talk of Amazon potentially acquiring Vente-Privee started. For newcomers (you would have to be embroyonic!) VP is the French originator of the online luxury brands sales concept with earnings of over €600 million and over 10 million members. The firm must have the highest monetization per member around €100.

Eventually however the American behemoth went after the cheaper option of acquiring Spanish BuyVIP at close to $97 million. The firm had revenues of €70 million in 2009 with a targeted €100 million in 2010. They have a relatively high membership at 6 million members but low monetization at €13.

We then have Brands4Friends, one of the larger European players with rumoured revenues over €80 million in 2009 and €250 million targeted in 2010, which has been expanding its European reach beyond Germany and Austria. They currently have over 2.5 million members with a per member revenue range around 32 euros. The firm invested in Secretsales earlier this year, one of UK’s larger players with access to the excess inventories of over 450 brands to serve as a nucleus for their UK growth – a smaller, more localised player but on a fast growth track.

And that brings me to the UK. A huge market and increasingly such a fragmented market!

There’s the French Brandalley which like Vente-Privee have been growing their market share in UK over the last two years. However small, Cocosa deserves a passing mention.

The largest UK player however I am sure must be ASOS. With revenues of over £222 million and net profit over £20 million in UK, the rest of the pack has a lot of catching up to do.  Besides known brands, ASOS is also launching an innovative section ‘ASOS Marketplace’ which will allow members to sell their own clothes and accessories. The marketplace could soon develop into a platform for new designers to launch without the capital investment required currently for a retail store etc. By 2011, ASOS plans to launch into Germany and France, the backyards of B4F and VP. Frankly it’s a wonder they haven’t done that already. BUT, and this is a big but, while B4F and VP are sales oriented member driven brand resellers ASOS is more of an etailer. A private sales oriented channel may be a thought for the future for inventory management purposes but it doesn’t seem to be in the pipeline at the moment.

In addition there are various other players in the UK which are focusing on smaller segments and becoming the lead providers therein. Figleaves is a name that comes to mind – the firm stocked over 100 lingerie brands and received over 1.2 million visits per month. A significant presence. They were recently acquired by online shopping business N Brown for £11.5 million (on revenues of £23 million) And then there’s a new addition - UK based firm Tagadas has recently launched a baby focused private buying club – niche but focused.

The closest UK competitor to ASOS and Vente-Privee however would be Net-a-porter. Their focus is procurement of the latest fashion products, in-house inventory management and online distribution rather than surplus inventory management for the big brands – a completely different market with its own drivers and issues. However, Net-a-Porter has gone a step further and launched a sister site – Outnet – which hosts time limited shopping events. Et voila we have the perfect solution for excess inventory without any dilution of the brand! The extension is part of the acquisition of Koodos earlier this month – a logical extension.

In summary, there are a number of competitors popping up in the private sales market – both the fashion oriented and the niche oriented. But is there really space for that many? Moreover what’s the solution when the large retailers decide to provide their own solution? I think the answer lies as much in excess inventory management as generating demand and a new sales (pull based) channel.

Simplistic as it sounds, the key for any of these websites is in the membership and the opinion generating and purchase driving power of the websites. With a significantly large membership base at the providers, retailers wouldn't need to go through the rigmarole of setting up their own platforms. In addition there are always stories like the one about the huge demand driven by the Gilt Groupe for Louboutin shoes which drove the maker to actually schedule higher production (Urban rumour?)

The ideal scenario for me would be a Net-a-Porter with an integrated Crowdstorm!....I for one am routing for N-A-P...the UK story.