Online fashion curator FarFetch, which links shops to customers, grows in China
The e-commerce platform carries no stock itself, but instead links shoppers with more than 500 boutiques amd 1,500 designers around the world. It’s just opened offices in Shanghai and Hong Kong
You don’t need to hop on a plane to shop at your favourite stores in London, Lisbon or Los Angeles, because e-commerce marketplace FarFetch has brought those stores to your computer or phone. Fancy a Stella McCartney dress from Browns in London? Or a pair of Mykita sunglasses from Monocle in Rome? FarFetch will make the connection for you. It is the portal that tries to show you the best of what boutiques and brands offer around the world.
Founded by London-based Portuguese entrepreneur José Neves, FarFetch has a different business model to that of other e-tailers such as Net-a-Porter and Shopbop. FarFetch doesn’t hold any stock. It provides customers with the means to connect and peruse the collections held by their favourite boutiques around the world, and then place orders. FarFetch handles the transaction, offering Alipay in China, and then individual stores will handle the delivery.
The formula has proven to be a success. It is now a US$500 million business and China has swiftly grown to 12 per cent of that (US$60 million), which Neves admits is a drop in the ocean given the number of luxury customers in the country. But with new offices in Shanghai and Hong Kong and what he claims as the first Chinese mobile app, Neves believes business will be further boosted.
“The DNA between us and Net-a-Porter is completely different: Net is editorially driven and advises customers on how to dress; our stance is about curating the curators and bringing together on one platform another viewpoint of fashion,” explains Neves. “We provide a platform for the best boutiques and brands to speak to the luxury customer.”
FarFetch has a portfolio of 500 boutiques and 100 brands internationally, and 1,500 designers are represented on the site, which gives the shopper the feeling, he explains, of travelling the world. Some of those designers are quite small and offer something unique.
“We did a comparison with three luxury websites – one pure e-commerce and two department stores – and found that 88 to 92 per cent of the product available on FarFetch was not available on those websites.”
Neves grew up immersed in fashion, but his first passion was computers and at university, when he was 19, he set up a software development business working with small clothes factories and design studios. In 1996 he moved to London to launch a shoe brand, Swear, and then co-launched a multi-brand boutique called B Store.
His idea was to merge fashion and tech. Net-a-Porter had proved there was now a marketplace for luxury fashion online, and he was also aware that eBay and Alibaba (owner of the South China Morning Post) wouldn’t be able to offer the level of fashion curation that he could.
He persuaded 25 boutiques to embrace his concept, starting with Maria Luisa in Paris, Feathers in London and Henrik Vibskov. It was a challenge he recalls, sustained by belief. “How do you attract talent when you have no buyers, and buyers when you have no product to sell.” He managed and launched FarFetch in October 2008. Two weeks later the global stock markets crashed.
While it was difficult to get funding through those years – the big investors arrived in 2010 – the financial crisis did make boutiques rethink their strategy now that e-commerce was becoming so important. “So they had time to listen, and maybe they wouldn’t have if their businesses were growing like crazy,” says Neves. Now FarFetch has boutiques across America, Europe and Scandinavia, some in Brazil, Singapore, Malaysia and Japan.
Recently the e-tailer acquired London’s Browns boutique, founded by Joan Burstein, which forms part of his plans for the future. “We are keeping the DNA of Browns and polishing the jewel,” he says. It will be a much-needed laboratory to test new omni-channel technology because innovation is moving at such a pace.
His vision is to create “a store of the future” experience that can be rolled out to other boutiques. In the meantime, the focus is on nurturing FarFetch as an inspiring place that seduces you into buying that beautiful new dress, whether it’s from Singapore or San Francisco or anywhere else around the globe.