First, designers allowed Gilt to sell current season merchandise for a fraction of the department store price within weeks of its arrival on brick and mortar floors.
Then, it started selling full-priced product from brands like Helmut Lang.
Now, rumors are circulating Gilt is starting its own label. While creditable sources say that this rumor is just that---a rumor---we don't think it's a bad idea. Here's why:
Pros: Even tighter inventory control. Even larger markup. Easy way to supplement product when other brands' inventories are low.
Cons: Risk brand dilution. People might not buy it. The thing about a private label is that, even when it doesn't have a fantastic sell-through, it still typically makes the company money because it's so cheap to produce. (Consider Barneys private label--They've always got a ton of inventory left, but they keep making it. There must be some sort of financial gain.)
In the end, this could be Gilt's way of truly separating itself from the flash sales pack.