Attention (male) entrepreneurs and VCs: Women and moms aren't actually the same demographic
Michael Carney's post on JustFab's acquisition of JustKids this morning sparked an interesting debate on our staff about the difference between a site that sells to moms and one that sells to women. Yes, all moms are women. But when they become moms, they change dramatically -- not only in size, shape, energy level and priorities but in the way they shop and spend money too.
I'm not saying it's not a smart deal. But I have a hunch that the synergies between these two companies might not be as great as the (male) executives expect, mainly off of this quote from JustFab co-founder Don Ressler: “The opportunities for cross promotion among the brands are vast. Many JustFab members have daughters who are mini-fashionistas and the mothers of the FabKids girls love to spoil themselves with a little glamour.”
I'm sure someone fits that demographic, but it is certainly not the sweet spot for cross selling between moms and kids. If it were, you'd see more stores that sell six-inch stilletto pumps next to diaper bags. That was the premise behind Bravo's reality show "Pregnant in Heels" -- that those women are a massive, massive exception, who weren't always depicted well, getting blow outs in their labor and delivery rooms.
There may come a point when I call my daughter a mini-fashionista and prioritize giving her a "little glamour," but right now that quote quite frankly makes me want to punch someone. It's all a little too JonBenet for me. I already dread my daughter wanting to dress like Kim Kardashian in junior high-- let me at least wait until then. I've banned family members from giving us any glitter oriented gifts. Also -- newsflash! -- a good deal of moms have sons, not daughters. But never mind my personal preferences, glitter is just not a priority when you give birth.
Now, I'm not saying JustFab's competitors necessarily get moms more. In fact, I've been surprised for the past five years or so that there aren't more Web properties dedicated to moms specifically.
Web entrepreneurs tend to build companies out of their own experience, and we've had a huge baby boom among the dominant Web entrepreneur set: From Max Levchin to Evan Williams to Biz Stone to Mark Pincus to Nirav Tolia to many, many more. It seemed to go from everyone of a certain entrepreneurial age was hanging out at parties to everyone seeing each other at baby showers and kids' birthday parties. That's common in most groups of friends and coworkers, but this group happened to be ones who'd had massive success in the Web 1.0 and 2.0 eras.
One example: I went to meet with Tolia last week, and he said, "That's a Japanese Weekend dress isn't it?" When male entrepreneurs know the names of local maternity brands, it tells you how much these gatekeepers have changed.
In fact, a few years ago I predicted we'd see a rise in more family-oriented ecommerce companies as these well-heeled entrepreneurs -- mostly looking to start new ventures -- with plenty of capital at their disposal entered a new phase of life. I was wrong. We mostly haven't.
Not so oddly enough -- given that I have a 15-month-old and am six months pregnant now -- this has come up in conversation with investors and entrepreneurs a lot over the last 18 months or so. The biggest takeaway, other than that moms and women aren't actually the same demographic, is that this is a vastly neglected category for good reasons. There are some real challenges here.
I should note, I'm talking about ecommerce specifically. Content companies like PureWow have done a good job of marketing to moms by not throwing them in the MOM! bucket, and in terms of community, the most baby pictures are shared on broader social networks like Facebook and Twitter. As a working mom myself, I don't have time for mommy groups or to read parenting magazines. I'd rather focus my precious free time on reading and spending time with the people I did before I was pregnant. So while community and content may not change just because you have kids, shopping patterns are another story entirely.
1. Maternity clothes have to fit.
When I was pregnant the first time, I asked a bevy of women's apparel etailers why they don't have sections for maternity clothes. I am speaking more of the flash sale companies and aggregators that have popped up in recent years.
When I asked Shop It To Me's CEO Charlie Graham about this, his answer was the same as most etailers I asked: "It's too hard to do maternity online." And he knows -- his wife was pregnant at the same time as I was (both times, astoundingly.)
Why is it so hard? A lot of women don't want to pay full designer retail for something they'll only wear for nine months. But more to the point, it's the one period in your life where you absolutely have to try stuff on to know if it'll be flattering, or you'll look like you're wearing a tent.
I couldn't argue with his logic. As much as I say I'd like a more convenient way to buy maternity clothes, both are fairly big barriers. At the time, I was a huge Shop It To Me fan, frequently buying at least one thing a week from the site's awesome tailored email newsletter of sale items in your size. But in the past two years, I haven't opened a single email from them, or most apparel companies for that matter. There's no point: Between pregnancy number one, the slimming down in between, and the new pregnancy: Their clothes either won't fit me, or won't fit me for long.
2. While babies are loud, there are a surprisingly small number of them born in the US at any given time.
Another clue of why we don't have more mom-centric Web companies came from the first interview I did with Brian Lee when he launched Honest.com. As he explained, diapers are one of the strangest markets in consumer packaged goods. They represent by far the biggest revenue generator for monster companies like Procter & Gamble. But it's a tiny, tiny sliver of the US market at any given time: Only 8.2 million moms have babies in diapers.
That's not exactly demographics tailored for the Web, except when it comes to things like diapers that are universal. Niches like EcoMom and Honest which aim at all natural alternatives have a core base who will pay a premium. But it's a hard one to win, and you don't see a lot of people trying.
It's not only a small audience. And, as Tolia -- whose wife also just had a baby and hence his uncanny knowledge of maternity fashion -- pointed out in our recent conversation, that phase of life moves relatively quickly. Taken together, that makes an even worse combo of factors for an Internet company: A small addressable user base that's staunchly defended by incumbents, costly to acquire, and one with almost no lifetime value. Even in the case of someone who has babies back-to-back, you're talking about a few years. That's worse than a fickle teenager.
3. The difference between a bride and a mom
Weddings are another strange category where a very small number of women create a huge market year-on-year. There aren't a lot of successful, stand-alone ecommerce companies tailored around weddings either for that reason. But there's a big difference in brides and moms. It's obvious to any woman who has been both, but I'm surprised at how often male entrepreneurs are flummoxed by this.
A wedding is the one time that a woman is allowed to be the absolute center of attention with all of the cash going towards her needs and whims. When you have a baby, it's the precise opposite. You live in a world of drool and baby vomit. Your "Sophie's Choice" moment is more likely to be picking between a nap or a shower, not a Vera Wang dress or a still expensive knock off of a Vera Wang dress.
There's a reason that the successful ecommerce companies aimed at motherhood have not particularly focused on selling to moms. Because moms' needs and desires will typically get the last pennies from each available dollar there is to spend. It's not that parents don't spend money; they just spend the bulk of it on their kids -- whether that's diapers, food, toys, childcare, or saving for education. That's why an UrbanSitter is far more likely to appeal to Web savvy moms than, say, a line of six inch pumps paired with a glittery onesie.
Witness that diaper market: Those 8 million or so babies represent an $8 billion market. Add in all other expenses and platform heels are well down the list for all but the most affluent women who probably aren't buying shoes for $40 on JustFab.
4. "Mom" is a dramatically varying term even in this small demographic.
The biggest challenge may be defining what the "mom" market even is. Even amid those 8 million households that have babies in diapers, the needs of the mom change dramatically over that time.
In a year, a mom will go from spending what little she spends on herself on maternity clothes; to nursing bras; to breast pumping and storage supplies, if she's returning to work; to comfortable, washable sensible clothes and shoes that look good but are also functional for chasing a toddler. And really, that's just my experience. I have no doubt every mom varies from me.
Likely, when kids grow up, go to school, and get out of the chasing stage, moms go back to some of their previous spending habits and priorities. But then they're really back to the "women" demographics, as broken down by age and income.
This struck me last night when I was talking to an entrepreneur who is working on an app for tracking a baby's feeding, sleeping, diaper schedules. There are a ton of apps that do this, and few that do it well. (None in my experience, if you know one leave it in the comments, as I'm about to go through this again.)
But more to the point, how big is the market if one did? Most parents only religiously track this in the first few months of a baby's life before moving onto bigger problems of teething, walking, baby proofing, and potty training. The phases move so quickly that even in the already small bucket of families with small children, there are wildly different needs and spending priorities from month to month.
This is perhaps why Diapers.com is one of the only ecommerce companies to get a decent $500 million exit: It's the lone, great equalizer of parents, if only for a few years.
[Image courtesy x-ray delta one]