Does Ashfords attempt to bring luxury online represent a fundamental change in the nature of e-tailing?

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Does Ashfords attempt to bring luxury online represent a fundamental change in the nature of e-tailing?

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Yes. There is a shift going away from pure discounting and high volume being the only types of approaches to selling online. Because there are so many pressures on profitability, people are beginning to realize that a category like luxury goods is more attractive. Our average order sale price is $500 — much higher. And because the products are so small, we can do the shipping out of one facility in Houston. We don’t need any additional warehouse space. Our operating costs are fixed. The only thing left is marketing spending, and that goes down as we build up customer loyalty. All this makes people realize that this is a far more viable business model than other Internet retail categories. I believe this will be the first category that e-tailers will make money. Q: Is price a barrier? A: No. Price is not a barrier. We have sold someone $60,000 of jewelry and 30,000 watches. Our customers already have shopped online and have had a good experience at sites such as Amazon. Now they are re

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