ModCloth

ModCloth

Company type	Private
Industry	Retail, Fashion
Founded	2002 (2002)
Founder	Susan Gregg Koger, Eric Koger
Headquarters	Los Angeles , United States
Area served	United States
Key people	Matthew A. Kaness (former CEO)
Products	Women's apparel, accessories, home décor
Parent	Nogin (since 2021)
Website	modcloth.com

ModCloth is a U.S.-based online retailer that focuses on women's apparel inspired by indie and vintage styles, with its main office located in Los Angeles.

History

Established in 2002 by Susan Gregg Koger and Eric Koger during their time at Carnegie Mellon University, ModCloth initially operated as a platform selling pre-owned vintage dresses. By 2005, the company had achieved $18,000 in sales and obtained initial funding in 2008. The revenue surged to $15 million by 2009, prompting a move from Pittsburgh's Strip District to San Francisco. This growth continued with sales reaching $100 million in 2012 and surpassing $150 million by 2014.

In January 2015, Matthew A. Kaness took over as CEO from Eric Koger. Kaness brought experience from his previous position as Chief Strategy Officer at Urban Outfitters. Under his leadership, ModCloth introduced its own branded label and ventured into multichannel retail through pop-up Fit Shops located in Los Angeles and San Francisco. These shops offered a selection of apparel, accessories, home décor, and products from local artists while highlighting online features such as Fit for Me and Style Gallery.

During 2016, ModCloth embarked on the "IRL Tour," setting up temporary pop-up stores in major U.S. cities including Washington, D.C., Portland, Austin, Denver, and Pittsburgh. Later that year, the brand opened its first permanent FitShop in Austin; all other temporary locations have since been closed.

In March 2017, Walmart's subsidiary Jet.com acquired ModCloth. This acquisition was intended to utilize Walmart’s financial resources to grow ModCloth’s brick-and-mortar footprint and expand its customer base while allowing the brand to operate independently. The purchase price was reported to be between $51 million and $75 million.

By October 2019, Walmart sold ModCloth to Go Global Retail, a brand investment firm, as part of a strategic shift following difficulties within Walmart’s e-commerce sector.

Nogin purchased ModCloth from Go Global Retail in May 2021. After Nogin filed for Chapter 11 bankruptcy protection in December 2023, a restructuring plan was approved in April 2024 that involved B. Riley Financial becoming the new equity partner.

Support for the Truth in Advertising Act

In 2014, ModCloth distinguished itself as the first retailer to endorse the Heroes Pledge for Advertisers, committing to refrain from Photoshop modifications that alter the shape, size, proportions, or features of models in its advertisements. By June 2016, ModCloth publicly backed the Truth in Advertising Act on Capitol Hill, with co-founder Susan Gregg Koger delivering remarks alongside Representative Ileana Ros-Lehtinen, a leading advocate of the bill.

Utilization of Authentic Models

Beginning in 2015, ModCloth featured its own employees as models in swimwear campaigns, reflecting its dedication to promoting body positivity. This move was informed by studies linking exposure to thin models with diminished self-esteem among women and strengthened ModCloth’s market position by showcasing genuine body representations in marketing materials.

Rebranding of Plus-Size Offering

Also in 2015, ModCloth eliminated the separate plus-size category from its website after a company survey found that nearly two-thirds of women felt uncomfortable shopping within a distinct plus-size section. The plus-size collection was merged into the primary site and became accessible through size filters, consistent with ModCloth’s inclusive business philosophy.

Crowdsourcing Strategies

ModCloth has actively employed crowdsourcing methods to refine its product offerings and boost customer interaction.

Style Gallery

Style Gallery serves as a platform where customers upload photos wearing ModCloth apparel. Highlighted on the company blog, this feature emphasizes real customer imagery over professional modeling, enhancing brand credibility and consumer connection.

Fit for Me

Available through the ModCloth app, Fit for Me delivers customized clothing suggestions based on individual body measurements and user reviews. This analytics-driven tool minimizes purchase uncertainty by providing recommendations tailored to unique body shapes, reinforcing ModCloth’s focus on customer-centric innovation.

Be The Buyer

Launched in 2009, the Be the Buyer program allowed customers to vote on clothing designs presented in a virtual tradeshow. Designs garnering sufficient votes were subsequently produced and sold on ModCloth’s platform. This crowdsourced approach complemented the traditional business model by increasing customer involvement and guiding product development.

Make the Cut

Introduced in 2012, the Make the Cut contest invited customers to submit original clothing designs. Winning entries were incorporated into the spring collection, with designers credited on garment labels. This initiative further emphasized ModCloth’s strategy of integrating consumer creativity into product innovation.

Deva Pardue Design Controversy

ModCloth encountered criticism for utilizing an artwork by designer Deva Pardue without obtaining permission or providing attribution, raising questions about intellectual property protocols within its design process.

Philanthropic Efforts

On March 5, 2012, ModCloth contributed over 500 dresses to The Princess Project, a nonprofit organization that offers free prom dresses to high school girls facing financial hardship. Additionally, for every dress sold from its Fancy Frocks collection that day, ModCloth committed to donating an extra dress. Employees also participated as volunteers during dress distribution events.

In 2015, ModCloth collaborated with Schoola, an online retailer supporting more than 10,000 U.S. schools, to generate funds for the Malala Fund, which promotes education for girls worldwide. As part of this partnership, ModCloth donated clothing items that Schoola sold at discounted prices, with proceeds directed to benefit the Malala Fund.