How online fashion retailer Zalora cracked Southeast Asia

For the past few years, athleisure has taken the world by storm. But while retailers and fashion brands rushed to fill their racks with activewear designed to be worn outside the gym or fitness studio, fashion portal Zalora took pains to differentiate its product offering – by dissecting the demand for performance items for those actually taking part in sports.

“All countries have embraced sportswear as a lifestyle fashion product, but in terms of performance products, the demand is very different by country,” says Giulio Xiloyannis, Zalora Group’s chief operating officer. “In the Philippines, they want basketball wear from top sports brands; in Malaysia, it would be oriented towards badminton or soccer gear.”

It is unique, country-specific insights like these that have given the e-commerce fashion site a competitive advantage in Southeast Asia, a region that industry watchers believe has tremendous potential for growth.

A study by Google found that among the region’s 350 million internet users, 120 million shoppers spent US$23 billion on e-commerce in 2018, doubling the amount from the previous year. By 2025, the market is expected to be worth US$102 billion.

Headquartered in Singapore and Malaysia and owned by the Global Fashion Group, Zalora is a rare Southeast Asian e-commerce company that is focused on fashion, shoes, accessories and beauty.

“We made a very early decision to focus on fashion. The reality is that embracing fashion from every angle, by understanding it inside out from the trends that are emerging to the complexity of returns and sorting products, is what has given us the edge,” says Xiloyannis.

Other prominent home-grown sites, such as the Alibaba-owned Lazada, Sea Group’s Shopee – both of which are also based in Singapore – and Indonesia’s Tokopedia sell a wide range of products, similar to what Amazon does. The American tech giant, which is available in Singapore, is planning to enter the Indonesian market next.

Founded in 2012, Zalora is in Singapore, Malaysia, Brunei, Indonesia, Philippines, Taiwan, Hong Kong and Macau. To gain a strong foothold in Southeast Asia, the company has made it a priority to understand and “embrace the complexity of the region”, Xiloyannis says.

“Southeast Asia is not one big rich market but a multitude of big undeveloped or small developed markets or something in between, each of which has its own customs, culture, religion and language. It is Europe with a complexity multiplied 10 times and by thousands of islands. We embrace all our customers’ needs from modest wear to Chinese apparel for Chinese New Year,” he says.

In Global Fashion Group’s most recent earnings report, Zalora and The Iconic (its Australian online fashion retailer) delivered a net revenue of 110.2 million (US$116.6 million), a 36.2 per cent growth from last year on a constant currency basis. In November, reports emerged that the group is preparing for an IPO and is seeking a valuation of 1.8 billion to 2.5 billion.

One way that e-commerce portals are tapping into the internet economy is by offering bumper sales on shopping days such as the China-led 11.11 or Singles’ Day event, which has become hugely popular in the region. While sales figures indicate slowing growth in China, that is not the case in Southeast Asia. Since Zalora started taking part in 11.11 in 2014, sales have doubled every year, Xiloyannis says. This year, site traffic and the number of items ordered tripled compared to 2017.

The company’s localisation efforts, which include having teams in seven locations, has given it the opportunity to sniff out unique niches ahead of the curve. For example, it was one of the first e-commerce companies to launch a modest wear range by its private label Zalia in 2014, which went on to do well in Indonesia and Malaysia, where there are Muslim-majority populations.

Lovers of Korean fashion, especially the early adopters from Singapore, should also thank Zalora for being one of the earliest retailers to introduce a wider range of K-brands such as Shopsfashion, Seoul In Love and Hopeshow.

“About two years ago, we noticed that sales for certain products from brands such as Mango or River Island were going up. These products were relatable to Korean fashion, so while we started saying ‘yes, we can buy more from these brands’, we should also find the source. So that’s how we ventured to Korea,” Xiloyannis says.

Besides investing in an in-house fashion team to keep track of data-driven trends and ensure the site offers a good mix of products to suit its various markets, the company has also bumped up its investment in its logistics infrastructure. Its latest warehouse, which it calls a Regional e-Fulfillment Hub, is located in Selangor, Malaysia, covers an area of 470,000 square feet – about the size of nine soccer fields – and can process up to 100,000 items per day.

Operations in the Philippines and Indonesia, which have over 7,000 and 17,000 islands respectively, have their own warehouses. This has allowed the company to offer speedy delivery of between one and three working days.

“Fashion is about newness and getting items at the right time,” says Xiloyannis. The company also has a transport network that allows it to offer a liberal 30-day free returns policy, which has helped to spur sales since shoppers do not have to worry about common e-commerce pain points such as sizing or exchanges.

E-commerce opens doors. Someone living in a remote city who once had to take planes to get to a store now has access to next-day delivery

The focus on making fashion accessible even in Southeast Asia’s most hard-to-reach regions has begun to pay off. Xiloyannis says his team was surprised to discover a previously untapped demand for modest wear in the Philippines – before Zalora launched modest wear online, shoppers in the remote islands did not have easy access.

They had similar findings for sales of premium handbags in Borneo, where they sold more bags compared to cities including Kuala Lumpur, Penang and Johor.

“If you look at the distribution of shops, the customers in Borneo had to fly to another city in Malaysia to shop. So e-commerce opens doors. Someone living in a remote city who once had to take planes to get to a store now has access to next-day delivery,” Xiloyannis says.

The hyper-local fashion trends that remain as-yet undiscovered is why Xiloyannis says the company is bucking the trend of opening brick and mortar stores, unlike other retail portals.

“We look at pop-up events as a marketing tool or in collaboration with brands but we don’t see them morphing into offline retail outlets in Asia. One runs out of breath just chasing the e-commerce boom.”


No liquidity crisis in any segment barring gems & jewellery sector: Satish Marathe

Barring the gems and jewellery sector, there is no liquidity crisis for any segments in the economy, Satish Marathe, the government-nominee member on the central board of the Reserve Bank, said on November 29.

He also said the spike in the cost of funds is due to an increased risk perception, and not due to lack of liquidity in the system.

It can be noted that different perceptions about liquidity were one of the key triggers for the recent public spar between government and RBI, with the former calling for special windows for the affected sectors like NBFCs, MSMEs among others and the latter not heeding to it.

The issue reached such a flash-point that government initiated a never-before-used Section 7 of the RBI Act to formally direct central bank to implement its instructions but at the November 19 board meeting both the sides climbed down averting a major crisis.

“Concerns were being expressed about lack of liquidity, but no one is shouting for liquidity today,” Marathe, who comes from the co-operative banking sector, said speaking at a seminar at the Mumbai Marathi Patrakar Sangh here this evening.

He claimed that during the past 15 days, the situation has improved and the only problem is the increase in interest rates, as the cost of funds has gone up from 7 percent in recent past to 8 percent now.

Non-bank lenders used to get support from bodies like mutual funds and insurance companies “easily” earlier, he said, talking about the change in the current scenario.

“The only one sector that has some problems due to liquidity is gems & jewellery. Hopefully, banks will release more money to the sector. If money is not released, then it will be difficult to get exports,” he said.

It can be noted that the government has repeatedly complained about lack of liquidity and sought special interventions from RBI in the run-up to a crucial meet of the central board last week.

In fact, one of the key points among the 12 points agenda that the government had listed in the three letters North Block shot off to the RBI by October 10, was liquidity crunch being faced by NBFCs, MSMEs in particular and the overall system in general.

Marathe said macroeconomic fundamentals are strong enough with fiscal deficit and current account deficit being under control. Our forex reserves are the sixth largest in the world and are sufficient to take care of 10 months of imports, he said and exuded confidence that the rupee will appreciate to 65 against the dollar.

He said headline inflation will narrow to 3.50 percent by November or December.


A New Accelerator Model Tackles Fashion Industry’s Supply Chains

Factory45 and Market45 founder Shannon Lohr wants to help smaller startups in the sustainable fashion space.Factory45

After launching her own apparel brand {r}evolution apparel,  Shannon Lohr was burnt out. She had raised more than $60,000 on Kickstarter in 2011 to bring the idea to life and then taken it to stores across the country. But she needed a break.

She did just that and came back with a new approach to changing the fashion industry — consulting new up-and-coming brands. Her latest platform, Market45 complements Factory45, an online accelerator program that takes sustainable apparel brands from idea to launch. Market45 offers to house their creations and connect them with online customers.

Lohr says that it was her firsthand experience of starting a company and how difficult it can be that led her to set up Factory45. Specifically, she says knows the uphill battle that it takes to break into the fashion industry where supply chains are complex and often inaccessible to smaller brands. Factory45 was the first part of the solution: a business school for sustainable fashion startups, helping connect entrepreneurs with sustainable suppliers around the world.

But this realization took time, nearly a decade. In 2011, Lohr and a friend decided to launch sustainable fashion brand {r}evolution. Following a Kickstarter campaign that became the highest-funded fashion project in Kickstarter history at the time, the pair tripled their goal and quadrupled their first production run. After a sustainable fashion tour of the Pacific Northwest, the two were exhausted though.

At the end of 2012, Lohr sold her portion of the company to her co-founder and moved into consulting, putting to use all the skills she’d picked up during her own stint as an apparel entrepreneur. Although she had stepped away from running her own brand, Lohr realized that all the time she had spent fighting to get her foot through the door could save other designers the effort.


The Making of Georgian Fashion Moment: Tbilisi Fashion Week

From those tiny sunglasses seen on just about every celebrity to cover-rocking distressed denim outfits, Georgian designers have been setting major micro-trends lately. How big is Georgian fashion right now? Well, Tbilisi features two fashion weeks to accommodate its growing number of designers wanting to present to the international visiting crowds of press, buyers, and influencers. We start our series on emerging Georgian fashion industry with the 18th edition of Tbilisi Fashion Week.

Tako Chkheidze (center) with Georgian actresses Irinka Kavsadze (the granddaughter of the Bela Mirianshvili) and Gogola Kalandadze.Courtesy of Tbilisi Fashion Week

Dedicated to the beloved 1960’s Georgian actress Bela Mirianashvili, the grand opening took place high above the city at the spectacular terraces of the Funicular restaurant. Guests were greeted by models in modest monochrome dresses evoking nostalgia for a bygone era of cinema and a slower pace of pre-digital life. Fashion week founder Tako Chkheidze spoke eloquently about art and fashion not as perpetually transient frenetic trends, but as cultural forces leaving a lasting influence. By choosing to dedicate the events to a style icon from a period of Soviet censorship and scarcity, organizers highlighted the creative spirit that has always prevailed in Georgia! Such an intro was perfect for the week’s agenda focused on eco fashion.

Éthéré Accessoire presentation at the GhvinisUbani art spaceCourtesy of Tbilisi Fashion Week

The spring-summer 2019 collections were presented at the Ghvinis Ubani, a former Wine Factory turned multifunctional arts space, with several noteworthy locations such as the Museum of Modern Art and Chaikana Bazar serving as additional stages. In place of the conventional catwalk the runway was converted in an attractive pasture of synthetic grass to highlight the theme: “We must take care of nature.” Designer Lasha Jokhadze opened the show with an unusual theatrical presentation of his sophisticated all-black evening wear collection. His models were arranged lying down and as the music started, they helped each other rise to their feet and walked around hand-in-hand.

Lasha Jokhadze S/S 2019Courtesy of Tbilisi Fashion Week

Designer Tatia Korsava was a winner of the Tbilisi Fashion Week talent competition last season with a menswear debut inspired by medieval arts and neo-expressionist motifs in paintings by Merab Abramishvili. She made a strong highly-anticipated comeback with a post-apocalyptic collection reflecting modern ecological threats. Models wore protective trench coats, rubber suits, military jumpsuits and gas masks. Korsava playfully challenged gender norms, pairing ragged menswear with feminine glossy pleather waist-cinching bodices, bird-print silk blouses, and see-through mesh shirts.

Tatia Korsava S/S 2019Courtesy of Tbilisi Fashion Week

Another gender-bending twist on proportions and silhouette came from the Russian brand 1377. It re-conceptualized menswear staples with inclusion of mixed textures and elements typically reserved for women or children: flower appliques, flowing capes, and lurex tights. Even the lapti¸ the quintessential Russian peasant tree bark shoes, felt authentic in this well-thought-out presentation.


This Latina Fashion Designer Shares All She Has Learned Since Selling Her First Dress

Alexia Maria Alexia Maria

Alexia María started designing clothes for herself long before she ever designed a look for anyone else. Over time, and thanks to word of mouth and a strong social media presence, María was able to build a brand that has led to actors like America Ferrera and singers like Gwen Stefani wearing her looks.

In growing the brand from a business that sold primarily to friends and family to one that can be shopped at two flagship locations – one in California and one in New York — as well as online, María had to learn to juggle the demands from both the creative and business side of any new business.

“It takes a lot of discipline and a great team to give your 100% to both sides,” shares María. “With the help of my amazing team, I am able to completely focus on design when I need to. With their support I am able to let go of the business side for a while and just dive into designing.”

As an immigrant and Latina in the fashion space, María understands that women are layered and that the clothes they choose to wear reflect their heart above all.

“If you are comfortable with what you are wearing, you will be confident and be the best version of yourself,” notes María.

Below María shares her advice to other designers and entrepreneurs, how her Latinidad has influenced the trajectory of her career, and how she navigated making the jump to being a fashion designer.


Three Ethical Retailers For Your Next Sustainable Fashion Purchase

Think of your most recent clothing purchase: do you know where it was manufactured, whether the people who made it were treated fairly, whether any animals were harmed or the environmental impact of its production?

Though most people couldn’t answer these questions, there’s an increasing proportion of consumers that are becoming conscious of what they’re buying.

Ethical spending now accounts for £81.3 billion of the UK retail market, according to Ethical Consumer, and KPMG’s latest annual retail survey noted that almost 20% of shoppers were drawn to retailers that they know ethically source their goods.

Although high street brands such as H&M and Zara have launched conscious lines, shoppers who are clued up on sustainability are growing frustrated with fast fashion brands who only dip into the ethical retail world.

Instead, these are three retailers who provide conscious consumers with a huge selection of clothes, accessories and more, all of which is produced ethically and sustainably.

Gather & See

Every ethical shopper is different: one might care more about the workers behind the products; another might be concerned about buying only environmentally-friendly items.


Gather & See understands that, and the store allows its customers to shop by their priority.

Not only can people filter its products by type or designer, but they can also select them by choosing one of the retailer’s five founding philosophies: fair trade, organic, eco-friendly, small scale production and heritage.

Gather & See adapts to each shopper’s ethical priority.Photo: Gather&See

The shop stocks clothing, accessories and jewelry that fits every budget, from affordable fashion to luxury, targeting the fashion-savvy, ethically-minded customer.

Gather & See is a relatively new retailer, founded four years ago by two fashionable women who were fed up of feeling disconnected from the production process.

Now, they ensure each of the more than 40 designers featured on their site produces clothing that fits into at least two of Gather & See’s philosophies. For them, it’s just as much about the ethics as the aesthetics.

People Tree

Founded 27 years ago, People Tree is one of the most well-established ethical retailers around. The shop’s mission is simple: to be 100% fair trade throughout their supply chain.

But what does “fair trade” mean? It’s a way of doing business that guarantees workers aren’t discriminated against. They are provided with good working conditions, their rights are protected, and they are paid sustainable prices for their products.

That means People Tree’s wide range of women’s fashion, that offers everything from cozy knitted jumpers to party dresses, is created by workers in the developing world who are treated well and not exploited.

People Tree is 100% fair trade throughout their supply chain.Photo: People Tree

Not only does People Tree strive for its stock to be ethically-sourced, but it’s also aware of the environmental impact of fashion.

You can trust that its clothing is all made with organic cotton and other sustainable materials, and colored using safe dyes. Even better, as many of its products as possible are shipped by sea, in order to reduce the retailers’ contribution to global warming.