|1||18% of users made 2 purchases in 2.5 months|
|2||Over 6,000 people on wait list for public launch in October|
Buying a camera, smart phone or other gadget these days can mean getting lost in the research. You can read consumer electronic product reviews from TechCrunch, CNET and Consumer Reports, and you can watch amateur product advisors on YouTube. You can buy the gadget that your friend recommended on Facebook. But there’s nothing like getting your hands on a product and trying it out. That’s especially true for cameras, where personal preference counts.
Then there are returns—consumers have to decide whether to take the plunge and prepare to pay a steep fee if it doesn’t work out. Depending on the store or manufacturer, returns can be costly and complex.
According to Lumoid co-founder Aarthi Ramamurthy, there’s just no good, cheap way to try something out. That’s why she developed Lumoid’s consumer-friendly discovery and decision-making platform.
Most people don’t write apps on their honeymoons. But that’s what Ramamurthy did. While working at Microsoft, where she managed various projects including bringing components of the Xbox Live platform to mobile devices, she and her husband spent many honeymoon hours in Hawaii working on Bubblegum. The app quickly became a Windows Phone photo-sharing favorite. She moved on to Netflix where she met Lumoid co-founder Eric Schoonover and gained insight into various consumer electronics devices and platforms. The overnight success of Bubblegum gave her the courage to make a big entrepreneurial move.
In 2011, Ramamurthy co-founded True&Co, a no-measuring-tape-needed, online bra-purchase service that uses algorithms to recommend “personal bra styles” that actually fit. The company also has a try-before-you-buy service—customers are sent several options and send back what they don’t want.
“I learned [from True&Co] that if you can make the online to offline experience better, that’s where the magic lies,” she says. While True&Co could have just handled the fit algorithm component and licensed it out, the company became successful by building the entire enterprise, right down to shipping and returns.
Having created a better bra shopping experience, Ramamurthy began talking with venture capitalists and executives at Zappos while developing an investment thesis in an area she’s passionate about: photography. A skilled amateur photographer, Ramamurthy began networking with photography workshops around the country, asking instructors what they and their students need.
“They all talk about needing a platform where they can send their students to rent gear … if only someone would take care of that,” she says. Ramamurthy also found out that amateur photographers are hesitant to sign up for photo safaris and tours if they’re forced to buy expensive gear they haven’t tested.
A new way to buy gear
Ramamurthy quickly put up a basic website, initially listing her own photography gear. She developed a recommendation system for specific photography needs and began shipping products to consumers that they could keep for a small daily fee or return after a trial period. With each return, the consumer would receive a recommendation for another product to try.
Having the daily trial fee count toward the purchase price smashes through the friction inherent in photography and other expensive consumer electronics areas, Ramamurthy says. Lumoid does everything local rental stores don’t. It ships direct to you, takes the product back if it doesn’t work out, gives you a trial and credits you for the trial fee, and recommends alternatives. Customers call Lumoid to “a Best-Buy showroom brought to our living room.”
Lumoid uses cameras from used camera shops to keep inventory costs down, then if the user buys, they are shipped a new camera. The startup also works with retailers who have excess inventory in order to fill orders for customers.
Photography and beyond
Photography is $12 billion business as well as a “great community of people,” Ramamurthy says. Soon, Lumoid will expand from that valuable starting point into handheld devices like phones and tablets—areas where people have too many choices and are best informed by trying items out themselves. To this end, Ramamurthy is already establishing partnerships with companies to provide inventory and sponsorship-type deals.
“I see Lumoid as the destination site for consumer electronics in four or five years,” Ramamurthy says. She sees her site as especially helpful for the average non-expert enthusiast.
“On Lumoid, you’ll find other peoples’ reviews and recommendations based on who you are and what you’re looking for, and you’ll have access to a really easy way to try something and convert it into purchase,” she says. “And if you just want to buy, that’s fine too.”
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