At ShoeDazzle, old CEO boots old business model for something rewarding (exclusive)

ShoeDazzle is reverting back to what it knows best: helping women find trendy, discounted shoes.

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Just three months after the L.A.-based e-commerce company reinstated its cofounder Brian Lee as CEO, it has announced some big changes. Among these is a new “VIP” membership service that enables users to receive special discounts on shoes. This harks back to the site’s early days when women paid $40 each month to receive a pair of shoes.

Over coffee, Lee said the plan is to bring back “innovation and creativity” to the site. Recently departed CEO Bill Strauss had planned to turn ShoeDazzle into a Zappos clone and bolster its marketplace with apparel, lingerie, and swimwear. Strauss also did away with the membership model to enable the site to appeal to a broader audience.

“Bill Strauss helped us build a foundation,” said Lee over coffee. “But I didn’t feel that the site was headed in the right direction.” Shoes account for 80 percent of the overall business — although the site will continue to sell handbags and accessories.

The new VIP membership service costs $9.95 a month. Unless users make a purchase, the monthly fee accumulates in an account known as a “shoe fund.” Women that sign up to the program receive special discounts, advice from personal stylists through a concierge service, and extended return policies.

Lee hopes to increase return visits to the site and gather data about consumer purchases. ShoeDazzle uses an algorithm, not dissimilar to Netflix, to target its members with shoes they’ll love. The curatorial piece is central to the company’s vision — Lee explained that customer service reps receive “fashion training” so customers can call and ask for a pair of shoes that will match their red dress.

Lee said the program is showing early signs of success. ShoeDazzle is adding 500 women a day to the VIP program from the wait list. Likewise, results from the beta have been encouraging (about 12,000 women are currently signed up). The VIP program will be launching to the public in mid-February.

The site is already known by over 45 percent of women aged 18 to 32, but to increase awareness, ShoeDazzle surveyed its members for their ideal celebrity spokesperson. The winner? Rachel Zoe, who was recently named the company’s chief stylist. Lee is no stranger to the benefits of celebrity endorsements — he cofounded the Honest Company with actress Jessica Alba.