15 Aug 2016
E-commerce: Why the Hong Kong Sourcing Hub Proved Ideal for Zalora (Interview with Zalora)
Founded in early 2012, e-commerce fashion giant Zalora has invested heavily in South East Asia. The Singapore headquartered company sells to Hong Kong, Malaysia, Thailand, Indonesia, the Philippines, and Vietnam, as well as in Australia and New Zealand.
It offers some 500 fashion brands from the US, Italy, France and Britain, as well as local labels. As an online platform, it taps into the massive consumer market in the ASEAN region, with its young population and rapidly growing internet and mobile penetration.
Luca Barberis, Managing Director of Zalora explained the company’s Hong Kong operation, saying: “The advantage of having a presence in Hong Kong is that the city has a strong tradition as a fashion hub. All the big fashion brands can be found here, and naturally Hong Kong is a sourcing hub for Zalora.
“Aside from global fashion brands, Korean fashion has undoubtedly taken the whole of Asia by storm. It is very convenient for us to source Korean brands from here as flying from Hong Kong to Seoul only takes about three hours.”
Barberis believes that his company is the right retail channel for emerging designers, rather than selling through small independent boutiques. Zalora offers them a way to sell professionally, with a fully-fledged platform able to deliver payment security and infrastructure support. He believes many Hong Kong fashion designers can also use Zalora as a springboard to bring their designs to consumers across Southeast Asia.
Despite its reach across the ASEAN region, the company has no plans to sell to mainland China in the near future. Barberis said: “We only want to get into a market where we can be one of the top three key players. In China it appears that we cannot create such dominance. We have no plans to sell to the US and Europe for the same reason.
“We will continue to focus on the Asian market where we are doing very well in terms of the number of unique visitors and traffic. Zalora’s mission is to address a fashion market of 600 million people in Southeast Asia and Australia, worth over EUR 60 billion.”
The e-commerce giant is betting on a future where hundreds of millions of Southeast Asians will experience an increase in disposable income, combined with access to the technology and infrastructure for them to become regular online shoppers.