Houston-based luxury goods retailer Ashford.com, Houston, has formed a new alliance with Amazon.com that will focus on marketing through e-mail and package inserts rather than online links. Instead of making an up-front payment, Ashford says it will pay Amazon for individual marketing activities.
Ashford chief executive Kenny Kurtzman says that although the company will still have to pay Amazon under the revised agreement, it will be able to tie its costs to certain marketing activities known to drive traffic to its site. Ashford will compensate Amazon.com on a cash basis for this targeted outreach.
In another move to improve both its customer base and cash position, Ashford agreed on Thursday to acquire the online art dealer Guild.com in a stock deal valued at about 3.5 million dollars.
In addition to offering customers a broader line of merchandise, such as original artwork, hand-crafted jewelry, and home accessories, officials at Ashford says the acquisition of GUILD.com supports Ashford’s path to profitability by bringing $11.5 million in cash as of year end and a 100% gross margin business model with no inventory and no debt.
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