of the company’s struggles stem from the financial meltdown of 2008 — founder David Reinke explains that after raising some seed money, StyleHop was planning to close a Series A in October 2008, which happened to be right when Sequoia’s RIP: Good Times was making the rounds. The funding round never happened, and the company quickly had to shift gears from its consumer-facing fashion games to something more directly related to generating revenue.

This second model was to help retailers with their merchandise selection by assembling a consumer panel of women who had proven that they could pick winning items. To create this panel StyleHop asked prospective panelists to rate items that had already been released, and compared their predictions to historical data to see who had the keenest eye.

StyleHop signed up two big-box retailers as pilot customers, who used the service to pick out which fashion items to feature in their stores the following season. And it apparently worked: Reinke says that StyleHop panelist predictions were seven times more accurate that the predictions of in-house ‘product pickers’ when comparing how each item sold versus how much inventory had been ordered.

Unfortunately, despite these encouraging results, the service couldn’t land any larger-scale rollouts. Reinke attributes this in part to the company’s lack of funding, and also to the fact that many retailers weren’t ready to experiment with new merchandising techniques during the economic downturn. He also believes that StyleHop may have taken the wrong approach when dealing with these retailers — it was mostly negotiating with middle- to senior-level managers, some of whom could have their jobs potentially threatened if the system worked. Instead, Reinke thinks StyleHop should have tried to work more directly with CEOs and company boards.

The failure of StyleHop is interesting in part because there are currently an increasing number of services looking to reinvent the way fashion is selected and presented to consumers. ModCloth has done extremely well turning this model on its head (see my interview with the founders right here), and Moxsie is also looking to help crowdsource merchandise selection. However, both of these are targeting the indie fashion market — StyleHop was hoping to reinvent merchandising for mass-market stores.

StyleHop has been added to the TechCrunch Deadpool.

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Authors: Jason Kincaid

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