This story appears in the June 25th, 2012 issue of Forbes Magazine.
“I wake up every day and wonder if I’m crazy,” says Mar Hershenson, 40. “I’m working like a twentysomething. I have three kids.” And a year-old startup, Revel Touch, that has taken $100,000 of her savings, $2 million from angel investors—and is some distance from profitability.
But there’s promise in her approach. A tablet-based platform that supplements a brick-and-mortar visit, Revel Touch wants to change the way people shop by making the iPad a supplementary tool—not a destroyer—of in-store sales.
Say you walk into a specialty children’s boutique like Mod Mama in Providence, R.I. looking for a Tea Collection Botanic Garden Play dress, 2-year-old size—and the store has that item only in a 4-year-old. No problem, you can order it online while in the shop, via an iPad app made for Tea Collection. Revel Touch adds to both sides of a transaction: Customers get to buy something right away without being told to go home and look for it online; store owners can offer greater variety without piling on inventory costs, while keeping margins roughly on a par with items sold off the floor. Mod Mama claims Tea Collection sales have jumped 20% since using Revel Touch.
Hershenson charges a set-up fee, then $5,000 to $15,000 a month to keep the app refreshing frequently, as it pulls images from catalog stock photos, product reviews and videos. So far, though, she’s signed only five customers, including clothing line Anthropologie, furniture brand Design Within Reach and Tea Collection. Hershenson hopes to pull in sales of $4 million this year, which implies a quadrupling of customers. She bets she’ll be in the black next year.
She’s definitely onto something. Nearly two-thirds of people browsing Revel Touch apps are doing so between 5 p.m. and midnight, and half are lingering on the fancy touch features that let you match tops and bottoms with the swipe of a finger. Users are also spending twice as much time browsing these catalogs than they are on websites via PCs. “People are using iPads to unwind,” says Hershenson. “Much like you’d grab a few thick catalogs to thumb through after a long day.” Anthropologie is betting that 20% of its sales this year will occur on tablets. Its software detects if you’re visiting its website with an iPad and offers you the Revel Touch app; one in nine shoppers download it.
Since half of the largest U.S. retailers have already created their own iPad apps, why should anyone pay attention to Revel Touch? Because roughly four in five apps fail to get even 1,000 downloads. Reason: They’re boring, slow to load and don’t give you a chance to buy something.
Hershenson knows the frustrations but also understands the technology. She spent a decade launching startups that designed analog chips and sold them both. Then she joined Foundation Capital, a Menlo Park, Calif. VC, as an entrepreneur in residence, where she tried out various ideas. “Then I got an iPad,” she says. “That was transformational.”
Others are on it. TheFind, a San Francisco rival, is already showcasing 80 retailers’ catalogs on tablets and boasts 1 million downloads in various app stores. A little outfit called Google has also gotten into the act.
