In the past decade, online shopping has grown exponentially, proving to be a profitable business. As such, there is an emergence of the fashion tech industry, especially in Southeast Asia, with many startups setting up shops in the area. As the industry grows and expands, companies within the region have begun to address some of the problems many consumers and companies face while shopping online.
One major risk of buying clothing online is the possibility of the item being ill-fitting.. Ill-fitting purchases drive customers to return items. In 2019, the cost of returning online purchases was a hefty $256.4 billion USD in the Asia-Pacific region. As these issues increase with the growth of the fashion tech industry, many startups in Southeast Asia are looking to change the online shopping experience for consumers.
Malaysia-based Pixibo is an omnichannel retailer that helps enable online fashion in a seamless way for consumers and companies. The startup offers customers several options to shop, including a try-before-you-buy option designed to mitigate the sheer amount of returns fashion retailers deal with regularly. This gives both the consumer and retailers the opportunity to work with each other for a better online shopping experience.
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The biggest draw of Pixibo is, of course, the try-before-you-buy option. Their website states that the feature can help boost conversion rates, encourage higher than average orders and lower logistic costs through free express shipping and return options. Countless brands have already partnered with Pixibo, and the company hopes to see massive growth in the coming quarters. This comes on the heels of opening up a brick-and-mortar location in January 2021 following a Series A round funding of $1.4 million USD from Atlas Venture.
With sustainable fashion on the rise, more consumers are looking to flee from fast fashion.
Fashion tech startup Reflaunt is utilising this sustainable momentum to bring consumers and brands second-hand marketplaces so consumers can resell past purchases on a specific brand’s site.
In February 2021, they announced the resale-as-a-service tech company raised $2.7 million USD in pre-Series A funding. One of the world’s leading distributors of luxury fashion, MadaLuxe Group, led the investment round. Big names in the fashion industry, such as the former Jimmy Choo EO and the founder and former CEO of Ganni, Nicolaj Reffstrup, have invested in Reflaunt’s service. With the funding, Reflaunt will bring more talent to their team and develop a solid growth strategy for the coming quarters. The brands that lead the fashion industry can choose from various resale models, which will give more consumers the ability to resell luxury items while keeping fashion waste to a minimum.
The startup Zilingo came from humble beginnings to allow small merchants to scale their business. Now, the Singapore-based company is making waves in the fashion tech industry. In February, the startup secured $226 million USD in Series D funding, raising their valuation to $970 million USD, granting them near-unicorn status. Investors include Sequoia Capital and Temasek Holdings Pte. The company’s year-over-year revenue increase since its inception in 2016 gives it a considerable edge over competition in the fashion tech startup scene.
The Thai fashion eCommerce company Pomelo is currently making changes to its offerings. It recently announced that in an attempt to increase revenue, the company would give other fashion brands the ability to use its technology in analytics and demand forecasting. The business-to-business unit, Prism, launched in June and is designed to allow other fashion retailers to transform their traditional models into more sustainable brands.
Since the majority of Pomelo’s products are made from sustainable materials, their aim with Prism is to bring other fashion brands into the future of fashion tech. In September of last year, a recent Series C funding of $52 million USD brought the fashion brand’s total funding to a hefty $83 million USD.
Singapore-based luxury fashion digital marketplace company BlinQ launched in January 2018 and has grown steadily since. The company is geared towards bringing luxury brands and small designers together in one online marketplace for consumers.
The platform is unique as it provides a major missing feature across the fashion tech industry. It allows consumers to try on clothing virtually using augmented reality technology. Since its launch, the product return rate is zero, proving the 98% accuracy rate promised by founder Bob Chua.
In March 2020, the company raised $2 million USD, and they are now gearing up towards the second round of funding.
Fashion tech in Southeast Asia is making a bid for one of the world’s major industries. Looking ahead, it is unlikely that startups providing customers with a better online shopping experience will dwindle but instead prosper, as the industry is just beginning to make its mark.