ecommerce

Jewelry startup Chloe & Isabel updates the Tupperware party for the social media age

April 2, 2014: 10:39 AM ET

The New York jewelry startup has built up an army of social media mavens to sell its jewelry.

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FORTUNE -- New York-based e-commerce startup Chloe & Isabel launched three years ago with the idea of empowering media-savvy young women who like to Instagram, Pin, and Tumblr their personal style with their friends and followers.

The difference, though, is that Chloe & Isabel's army of contributors stands to make a lot of money in the arrangement by selling their jewelry to their networks of friends and followers. The company pays a 30% commission on sales of its jewelry; its sellers make anywhere from $30 per hour of work to $300 an hour. One new seller took home $4,000 on five hours of work in her first month, says CEO and founder Chantal Waterbury. (That's atypical, but shows how quickly some people are able to turn their social media savvy into cash.) It's the Tupperware party model, adapted for the social media age.

To be sure, it's not just a matter of sending out a catalog and telling these young women to spam their Facebook friends. Chloe & Isabel has invested considerable resources into teaching its 3,500 members the ways of branding, product photography, social media, and storytelling. It grooms them to be mini-entrepreneurs within the Chloe & Isabel framework.

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The company starts by vetting its users from the 3,000-plus applications it receives each month, accepting around 20% of applicants. Chloe & Isabel produces a robust set of training tools, from video and articles to quizzes and tutorials, to teach the sellers about everything from marketing best practices and analytics to the best Instagram filters, fonts, and color pallets to use on photos.

But more powerful than Chloe & Isabel's training is what the community has contributed. Waterbury says 80% of the seller best practices on Chloe & Isabel have come from the sellers themselves. "We can come up with great ideas and share them, but to have a merchandizer out in the field that supports our training with real life experiences is much more valuable," Waterbury says. Chloe & Isabel's sellers create thousands of pieces of content each week, sharing product photos, inspirational quotes, styling tips, and details about each piece with their networks.

It has worked: Without revealing specifics, Chloe & Isabel said it experienced 250% growth year-over-year in revenue in 2013 and is on track to grow by 35o% this year. The company raised $18 million in venture funds from General Catalyst Partners, First Round Capital, and others, and has 75 employees.

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Chloe & Isabel is now extending its model into a new category. This week the company launched its first foray into beauty products, with a fragrance called Jardins du Midi. Perfume might seem an odd choice for an e-commerce company, but Waterbury says its direct-selling model builds a unique kind of trust with customers. "If you're good at telling a story and people trust the brand, it becomes less of a problem," she says.

Besides, the sellers are increasingly finding success with in-person pop-up shops in partnership with local businesses. Waterbury says this gives the brand a physical presence (3,500 times over) without the overhead of brick-and-mortar retail. But even that can be repurposed for the digital world, as customers will see when the company releases a mobile app in the coming weeks.

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