The great race for China's online fashion market
As fashionistas swap malls for online checkouts, local e-tailers are battling Western websites for the lucrative Asian market, writes Divia Harilela
While the US has the largest and most established e-commerce market in the world, it's no secret that Asia and, specifically, China, is catching up fast. A MasterCard survey in November and December found that Chinese internet users shop online the most. When it comes to fashion retail, the strongest interest comes from China (54 per cent), followed by Thailand and South Korea. By the end of 2016, China's e-commerce is predicted to be worth 2.8 trillion yuan (HK$3.5 trillion).
With such promising figures, it's no surprise that established Western fashion e-tailers have turned their focus to this part of the world. In the past year we have seen popular websites such as Net-a-porter.com open an Asia-based fulfilment centre to serve its customers better, while shopbop.com and yoox.com have also launched dedicated Chinese sites.
However, what they didn't bargain for was fierce competition from their Asian counterparts. These sites are run by some of the region's savviest entrepreneurs, who pride themselves on knowing the local market. Their main challenge is differentiating themselves from the more established players, and they are launching sites with product offerings and services aimed at capturing the jaded Asian consumer.
Singapore-based Inverted Edge was launched only a few months ago, but is hoping to lure in fashion-lovers who are searching for Asia's next big designer star. Each brand is hand-picked by founder and CEO Debra Langley, who leverages her regional networks and relationships to find off-the-radar names.
"We focus on independent designers who, for many different reasons, may not be on the major e-tailers' radars. These are designers who often went to some of the best schools in the West, and are now doing their own thing in Asia.
"I call them the 'global citizen designers', because their sensibility, while decidedly international, is also very grounded in their heritage, and that's what makes them different," she says.
Currently, the site features brands such as Hong Kong-based Daydream Nation, Demoo Parkchoonmoo and Nineteen Eighty from South Korea and Major Minor from Indonesia. Besides stocking ready-to-wear collections, Inverted Edge also offers exclusive capsule collections and pre-order limited editions - something Asian consumers are looking for.
"Asian shoppers are becoming so sophisticated and discerning. While they love big global brands, they are no longer in awe of them. They may want something from Fendi, but similarly they would buy something from an Asian designer, because it's innovative and authentic," says Corinne Ng, director of Shopthemag.com a website that brings together Asian brands, such as Koonhor, Manish Arora and Fly Now.
AnyShopStyle.cn has set itself apart by promoting the best talent on the mainland. It stocks items from rising labels, such as knitwear designer Yang Du and environmentally-conscious, Shanghai-based womenswear label Moodbox.
"Creating a network where different designers can sell their wares on our site and where we can distribute across China was a very logical business model for us," says AnyShopStyle.cn co-founder Alice McInerney. "The Chinese middle class has been estimated to grow to 600 million in the next decade, so we're looking to offer a mix of the most interesting emerging Chinese and international designers to our potential clients.
"There are some phenomenal Western retailers in the marketplace, but our focus is the mid-range market. We're not high street, but we're not high end, and it's a really interesting space to be operating in."
Indeed, the contemporary realm is where many Asian-based retailers are excelling, and Hong Kong-based Zooq.com is catering to this market. Launched last year, it offers affordable designer fashions from more than 100 brands from Britain, the US and Australia, with the average price below HK$1,000. Other features, such as its price-matching service (if customers see the same product cheaper on another website, Zooq will match the price), give it an edge over its Western competitors, such as ASOS.com
"We offer a localised shopping environment: we convert the myriad of international sizing into units familiar to Asian customers; we operate a local, toll-free customer service hotline; our customer service representatives speak fluent English, Cantonese and Mandarin," says Zooq co-founder and president Norman Cheung.
"While China is an expansive market with many opportunities, it is also complex and competitive. It is common for the market to fluctuate, and we have seen a large number of Western businesses fail. This is why we strongly emphasise the need for local experience and know-how and the right product selection that caters to the local taste. For example, accessories are increasingly important to expand upon because they generally have a faster sell-through nature and are easier gifting options."
Indeed, accessories' popularity in Asia is why sites such as Bkrm.com have sprouted up. Capitalising on Asia's love of designer accessories, it offers "selectivity without a waitlist", allowing customers to access hard-to-find designer handbags and other products.
"The name Backroom means the room in the back of a store that keeps all the goods - including items reserved for VIPs - that you might not have access to," says co-founder Pinky Ngie.
To spice up its curated selection of luxury handbags and accessories, Bkrm also offers a vintage section offering everything from Chanel belts to Hermes disposable cameras.
And if Hong Kong customers are weary of buying online, they can visit the showroom in Harbour City to view and touch the products.
Who says West is best?
More Asian e-tailers to add to your shopping list
Offers pieces of jewellery and other accessories from exotic locations such as Turkey and India
Specialises in rebellious, cutting-edge jewellery from independent designers
A platform for contemporary Chinese design featuring everything from gifts to houseware
A funding site where you can discover and support emerging designers
International and local brands at affordable prices
Launched by a former fashion executive it carries 30 up-and-coming designers along with established names such as Alice Temperly and Sass & Bide