Marciano/14/dp1st/mark2nd
By NOLA L. SARKISIAN
Staff Reporter
Dressing millions of people in high-priced, stone-washed jeans was what Georges Marciano did best during the denim wars of the ’80s.
Now, the founder of Guess? wants to parlay his name into a different kind of success by auctioning luxury items like yachts and Ferrari cars on the Web.
Beverly Hills-based gmbid.com, a person-to-person auction site fully financed by Marciano, was launched last week. Among its offerings are Andy Warhol lithographs, jewelry, wine, vintage clothes, and even items from Marciano’s own collection of movie posters and Ferraris.
“The Internet is the business of the future, and what will separate successful companies from others is the services you offer,” said Marciano, who founded Guess? in 1981 and sold his 40 percent share in 1993 to his three brothers for about $220 million.
His Internet venture will join an increasingly competitive field of online auction houses.
In the past four months, eBay announced its $265 million acquisition of Butterfield & Butterfield. In addition, Sotheby’s Holdings Inc. teamed up with Amazon.com to launch an Internet site, and Christie’s plans to debut its site next month.
It’s a market that analysts predict will grow from $1.4 billion in 1998 to $19 billion by 2003.
“There’s plenty of room for sites in the auction format, especially in the luxury segment,” said Stefan Smith, an Internet analyst at Dataquest in San Jose. “We definitely see this (category) emerging with a more affluent society. With (Marciano’s) name recognition, gmbid could carve out a nice chunk of that market.”
Others aren’t so sure.
“In terms of pure competition, there’s lots out there, and you have players like Christie’s and Sotheby’s that have the brand name to lure eyeballs,” said Steven Tuen, an analyst at IPO Value Monitor.
In addition, attracting haughty collectors to a medium geared to the masses could be a gamble.
“What drives off-line luxury purchases is the shopping experience,” said Michael May, an analyst with Jupiter Communications. “The service you receive at Hermes will never be replicated at a Web site. The in-store experience allows Hermes to charge $400 for a belt where Gap can charge $12.”
Marciano said he plans to offer amenities not associated with competing sites. One notable difference will be his 10,000-square-foot showroom on Beverly Drive in Beverly Hills. Items cannot be bought over the counter. But soon, about half a dozen computers will be installed for visitors to join online bidders.
In addition, the company will act as a buyer, offering cash in less than 24 hours for authentic items to be auctioned on the Web. (Payments to sellers from traditional auction houses often take months.)
To avoid any fraud problems, gmbid has entered a partnership with TradeSafe to verify the authenticity of items.
“We’re taking every precautionary measure we can to provide customers with the best possible experience at our site,” said Julie Carson, president of gmbid.
