Revolve(RVLV) - 2022 Q4 - Annual Report

Financial Performance - In 2022, the company generated $1.1 billion in net sales and served over 2.3 million active customers, with an average order value of $304[44] - Approximately 85% of net sales in 2022 were at full price, indicating effective inventory management and pricing strategies[35] - The company's owned brands contributed 22.4% of the REVOLVE segment's net sales in 2022, with a significant increase from previous years[37] Customer Engagement and Marketing - Mobile sales accounted for 66.6% of total orders in 2022, reflecting the growing trend of digital channel usage among consumers[40] - In 2022, 48% of traffic for REVOLVE was driven from free and low-cost sources, highlighting the effectiveness of its marketing strategy[48] - The company has over 10.3 million Instagram followers across its brands, enhancing its social media and influencer marketing efforts[67] Product Development and Innovation - The company launched over 1,500 new styles per week on average in 2022, showcasing its commitment to product newness and trend responsiveness[35] - The company utilizes machine learning and artificial intelligence to optimize assortment and personalize the website experience, enhancing customer engagement[71] - The management team emphasizes a culture of innovation and data-driven decision-making, which has proven effective in navigating macroeconomic challenges[53] Customer Relationship Management - The company aims to continue acquiring new customers, leveraging strong repeat purchase behavior to enhance customer lifetime value relative to acquisition costs[54] - The company plans to deepen existing customer relationships to improve revenue retention and increase wallet share through enhanced customer experience and expanded loyalty programs[55] International Expansion - The company intends to grow international sales by localizing the shopping experience and leveraging its influencer network to accelerate growth outside the United States[56] Technology and Operations - The company has developed a highly scalable technology platform that supports its operations and enhances customer experience through data analytics and reporting[69] - The company's proprietary technology platform manages hundreds of millions of data points, enhancing its merchandising and marketing capabilities[51] Workforce and Structure - As of December 31, 2022, the company had 1,384 employees, with the largest teams in fulfillment and logistics (682 employees) and owned brand design and development (144 employees)[75] Strategic Focus - The company is focused on pursuing strategic acquisitions and investments to expand its product offerings and improve technology infrastructure[59] - The company has a portfolio of 31 owned brands and continuously optimizes its assortment to drive revenue and profitability growth[62] Financial Management - The company primarily holds cash and cash equivalents in money market funds and cash deposits, which are not significantly affected by interest rate changes[416] - Most sales are denominated in U.S. dollars, minimizing foreign currency risk; however, pricing in local currencies may impact demand in foreign markets[417] - Fluctuations in foreign currency exchange rates have not materially affected the consolidated financial statements, and the company has not engaged in foreign currency hedging[418]