WGSN Fashion Prediction Profits
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Sam Parr shares a story about WGSN, a highly profitable fashion trend prediction company.
"WGSN is a publicly traded British company that made £91 million in revenue in 2021. Their adjusted EBITDA was 41 million, meaning for every dollar they made, 45% was net income profit.
What they do is tell you which colors are going to be popular. They only have 65-100 customers paying around $25,000 a year. The product is basically a quarterly PDF that tells you what colors they think might be popular.
I'm pretty sure the way they get this information is they put tablets at fashion schools and ask students what they're feeling and liking. A real-life use case is like Starbucks making 100,000 uniforms - if millennial pink is the new color, they'll make their name tags that color.
It's a no-brainer for companies to spend $25,000 to get this quarterly PDF and the ability to DM someone at WGSN and ask questions like 'which shade of green should we be using?' That's their entire business model in the trend predicting space."
Sam Parr
Host of MFM and fitness influencer
Sam Parr is a serial entrepreneur and business media pioneer.
In 2016, he founded The Hustle, a business news media company that started in his kitchen with just $12 and grew to eight figures in revenue.
Sam led the charge in making newsletters popular when few believed in their potential.
After four successful years, he sold The Hustle to HubSpot, a publicly traded company. Now operating as HubSpot Media, The Hustle reaches 3 million readers daily, employs a team of nearly 100, and has been the launchpad for dozens of its staff to found their own media companies and newsletters.
Sam remains the host of the popular business podcast, My First Million, and continues to start and sell companies. He also co-founded Hampton, a highly vetted community for entrepreneurs, founders, and CEOs, and teaches people to write better through his platform, Copy That.