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What is contextual commerce? Gwyneth Paltrow explains goop at NRF

By Robyn Turk

Jan 29, 2020

Business

Not many 12-year-old lifestyle brands are featured in a six-part docu-series on Netflix, but not many lifestyle brands are founded by Gwyneth Paltrow. The popular streaming service released “The Goop Labs” earlier this week, focusing on the alternative wellness remedies showcased by Goop.

Speaking at the National Retail Federation earlier this month, the Oscar-winning actress-turned-entrepreneur founder of Goop acknowledged that her celebrity status has played a major role in bringing the brand to its current level of success. Goop currently operates a retail business in apparel, beauty and wellness, as well as a digital publication, and was valued at 250 million dollars in 2018, according to the New York Times.

However, Paltrow’s celebrity is not the reason for Goop’s success. Goop tapped into an important niche in the retail business before other brands knew to look for it: contextual commerce.

“We call ourselves a contextual commerce business,” Paltrow explained. “We are first and foremost in content, and we use that content to educate - almost like a service. We talk about things we love, we make things we love, and you can buy them on Goop or from other places.”

Goop’s success comes from its blend of content with retail. It first created the environment with which to pull attention from consumers, then created product lines to satisfy those consumers’ wants. When asked which other companies succeed in the realm of contextual commerce, Paltrow mentioned Disney because it “is a brand that at its nucleus creates content and story and resonance. They create minds and business from that. So that is different [from Goop’s industry], but it's contextual commerce as well.

Paltrow said that from the beginning, her intention with Goop was to create the content that she felt was missing from the publishing world.

“In starting Goop, I was able to create a different dialogue around this white space or answering a white space, which was that myself and a lot of women felt largely ignored by, you know, whether it was out of our doctors or our friends,” she said. “It was hard to get information around and optimization of self, whether it was mental or spiritual, emotional or physical.

Gwyneth Paltrow responds to controversies surrounding Goop

Another source of Goop’s rise to popularity has come from a surplus of controversies surrounding claims the brand has made regarding the benefits of certain products, particularly those advertised for gynecological wellbeing.

Paltrow commented that having already been in the public eye exacerbated the public backlash in response to the controversial claims, saying that articles are “going to get more clicks if my name is attached to it in the news than a business or person you haven’t heard of.”

The brand founder acknowledged that Goop’s controversies were well-founded and attributed the mistakes to the ignorance of youth. She said, “When we were a really young business,we didn't understand about claims or certain regulatory things and we made those mistakes,” despite the fact that Goop was already nine years old when some of the controversies in question took place.

Goop was fined 145 thousand dollars in 2017 for promoting a 66-dollar jade egg that it claimed provided several benefits in gynecological health.

Paltrow said that the brand has since “gotten incredibly buttoned-up” and now has a science and regulatory team to prevent making mistakes. However, she also said that the controversy the Goop has faced is due to the fact that its conversation around women’s health and sexuality is not well-received, rather than the fact that it had made false claims about how to promote women’s health.

“The other controversy, so-called controversy, that comes to us is about our content around alternative modes of healing, especially ones that have been around for thousands of years, or female sexuality,” she said. “It's incredible. It never ceases to amaze me the amount of outrage that it will inspire from women wanting to talk about their sexuality on any level.”

Regardless of the source of Goop’s controversy, Paltrow noted that its attention has helped her business to grow.

“For the most part if you are in the news and it's driving traffic to your site, it's not usually a bad thing. But we don't go out and court controversy - that's not part of the strategy.”

Image: Netflix Press Room