Gilt City Takes Facebook Further

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Street Smart Moves: The best or biggest deal, assertion, investment or other strategy this week.

Who: Gilt Groupe

What: Using Facebook Groups to create a private loyalty program

Last spring, an intriguing New York Magazine profile discussed some of the challenges Gilt Groupe faced as it grew bigger and more popular. Among them was the loss of its aura of exclusivity and community. At the very end of the article was revealed a long-term strategy: “Over time, company executives say, the idea is to divide Gilt Groupe into ever-smaller segments, showing customers only those items that fit into their style, or their price range.”

This week, Mashable reported that Gilt City, the company’s local daily deals arm, is test-driving a private loyalty program  on Facebook Groups. It’s not an extensive segmenting effort, but last month Gilt City sliced off 100 top-spending members in Chicago and invited them to join the group, offering up special invitations and other perks, and encouraging them to sign up other Gilt City shoppers. Giving customers special status and having them use Facebook to share deals is more convenient and personal than the usual “share this deal though email” strategy — and the company says its been successful in building subscriber base so far.

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