Convergence of the Apparel and E-commerce Sectors

YoStartups Team

The global apparel industry is among the pioneers to jump on the e-commerce bandwagon. The industry is quite well spread around the world, and the convergence with e-commerce has further strengthened it.

According to a research report by YoStartups, close to 10% of offline retailing businesses have been replaced by online marketplaces and e-tail ventures in the years from 2014 to 2018. However, despite the widespread presence of the industry across the globe and an increased number of e-commerce apparel players coming into the picture, there hasn’t been much activity on the investments front.  The same report highlights that the growth rate of investment amounts in the last five years for the industry capped at 1 %. It also found a dip in investment activities in popular apparel e-commerce hubs like that of China. In the five year period from 2014 to 2018, the industry recorded the lowest number of deals in 2018, but maximum amounts of investments were also made in the same year.

An important thing to be noted here is that the decline in investment activities should not be confused with the fall of the industry. An increasing share of the population with access to disposable income is among the several factors that are constantly propelling the growth of the apparel e-commerce sector around the world.  According to a report by IBISWorld, the global apparel manufacturing industry touched $658 billion in 2018 with a growth rate of 4.6% since 2014. The number of businesses adopting e-commerce is on the rise, and this growth can be attributed to a number of factors.

Here are some of the fast-growing apparel e-commerce startups in the world that have created a strong position for themselves in the industry.

Leflair

Leflair is one of the top e-commerce brands in Vietnam. Based in Ho Chi Minh, the e-commerce brand is among the premium ones in the country that offers access to apparel, accessories, and make-up from international brands. The young company was started by Loic Gautier and Pierre-Antoine Brun in 2015  and has a diverse product range for men, women, and kids. Leflair has found a lot of takers in the Vietnamese market as it helps them get access to international brands and offers a number of discounts and other deals on them from time to time.

Know more about this top apparel e-commerce startup from Vietnam

Website: www.leflair.vn

LinkedIn: www.linkedin.com/company/leflair

Limeroad

Indian apparel e-commerce brand Limeroad has carved out a strong place for itself in the Indian e-commerce industry.  It is among the top apparel e-commerce brands in the Indian sub-continent which has an innovative catalogue. The catalogue on Limeroad is created based on the users’ choice and preference using the online scrapbooking feature offered by the platform. Limeroad has received total funding of $50 million till date and was founded in 2012 by Ankush Mehra, Prashant Malik, Manish Saksena, and Suchi Mukherjee. The products offered by the platform include apparel, shoes, bags, and a host of other accessories.

Know more about this top apparel e-commerce startup brand from India

Website: www.limeroad.com

LinkedIn: www.linkedin.com/company/limeroad-com

Twitter: www.twitter.com/limeroadcom

Dolls Kill

Founded by Bobby Farahi in 2012, Dolls Kill is a rapidly growing apparel e-commerce brand based in the San Francisco Bay Area. The company celebrates individual styles and was set up with an aim to encourage to provide women with apparel that makes them stand out. Dolls Kill is getting a growing number of customer base including celebrities who rule their turfs with their unconventional style. It completed its Series B round of funding in December 2018, raising over $10 million from Angel Capital Management. This has been the largest round of funding for the startup to date.

Know more about this fast-growing apparel e-commerce startup from San Francisco

Website: www.dollskill.com

LinkedIn: www.linkedin.com/company/dolls-kill

Twitter:  www.twitter.com/dollskill

Lazada

Lazada (run by the Lazada Group), is a top online selling and buying e-commerce platform in South East Asia. The online marketplaces feature products from both local and international sellers. With a customer base of more than 560 million and a product offering that features more than 2,500 brands, Lazada is an e-commerce force to be reckoned with in Indonesia, Thailand, Malaysia, Vietnam, Singapore, and the Philippines. It is a subsidiary of Alibaba Group Holding Limited and boasts of quick order fulfillment timelines and excellent customer care services. Lazada has partnered with more than 100 courier partners to help achieve the same. Lazada’s shopping platform offers clothes, apparel, and a number of different lifestyle products.

Know more about this top apparel e-commerce startup from South East Asia

Website: www.lazada.com

LinkedIn: www.linkedin.com/company/lazada

Twitter:  www.twitter.com/LazadaSG

thredUP

San Francisco based thredUp is among the top American e-commerce platforms for second-hand apparel from premium brands. Set up in 2009 by Oliver Lubin, James Reinhart, and Chris Homer, thredUp has is encouraging its users to tackle product wastage by offering apparel that is used but ‘like new’. The high quality used apparel platform offers opportunities for both selling and buying on it. The company is the genius behind the Clean Out Bag program and is backed by prominent investors like Goldman Sachs Investment Partners and NextView Ventures.

Know more about this innovative apparel e-commerce startup from San Francisco

Website: www.thredup.com

LinkedIn: www.linkedin.com/company/thredup

Twitter:  www.twitter.com/thredup

Top Countries with an Unparalleled Apparel eE-commerce Sector

According to a report by YoStartups, Singapore, USA, and Germany are the top three countries in which apparel e-commerce startups have received the maximum funding in the years from 2014 to 2018. Countries, where fashion e-commerce startups have boomed irrespective of the investments received, include Singapore, the USA, and China. Let us look at the performance of the sub-sector in the startup ecosystems in each of these countries.

Singapore for apparel e-commerce startups

The apparel e-commerce game in Singapore is so strong that it has led to several offline retail shops pulling down its shutters in recent years. As shopping from the phone or laptop becomes an increasingly preferred habit,  apparel e-commerce brands in the region are leveraging the shift in consumer behavior to capture the markets effectively. The user base of the e-commerce industry in Singapore is expected to cross 3.8 billion by 2020 with the average amount spent on online platforms to touch $1,665. Fashion and apparel are the two largest e-commerce sub-sectors in the e-commerce segment in Singapore and are expected to maintain the same status until 2020, growing at a steady rate.

USA  for apparel e-commerce startups

The USA finds itself among the top countries for apparel e-commerce owing to a number of reasons. Buying clothes online became immensely popular in the country due to the advantages it offered over offline shopping and other alternatives like shopping for apparel through mail catalogues. In 2016, the American fashion e-commerce industry was valued at $63.3 billion and held a 19% share in the global fashion e-commerce industry.  The industry is forecasted to touch revenues of close to $22 million by 2021 at a CAGR of 8.8%.  The high internet penetration rate in the US is lending to a rapid shift in shopping patterns from offline channels to online platforms.

China for apparel e-commerce startups

The Chinese apparel e-commerce market is the largest market from every perspective, whether it is based on the customer base, the number of startups or the revenues and investments made. It was valued at $125.8 billion in 2016 and was among the top three regions that played a significant role in shaping the global fashion e-commerce industry. The other two regions were the US and Europe. The apparel e-commerce market is largely characterized and boosted by the wealthy consumer groups whose shopping revolve around luxury brands in apparel and other fashion and lifestyle items.

Upcoming Apparel E-commerce Industry Trends for 2019

 The dynamics in the apparel e-commerce industry keeps changing at a breakneck rate as new players and technology are introduced in the segment.  These play a huge role in shaping the global apparel e-commerce segment. Here are some of the upcoming apparel e-commerce industry trends that are expected to be seen more prominently in 2019.

The feature of the virtual fitting room is bound to become more common across online marketplaces. The demand for the feature is on the rise as it offers a good idea into how a piece of clothing would look on the buyer offering them the confidence to buy it and also reducing the number of returns owing to unsatisfied fit.

The increased use of augmented and virtual reality tools in the online apparel marketplace can be expected. Fashion e-commerce brands are looking for new ways to reduce the competition and adoption of AR/VR is among the top trends to achieve this.

Increased use of AI to provide precise and better recommendations of products and in marketing, the e-commerce platforms can also be expected.

The apparel e-commerce sector shares close to 30% of the global e-commerce segment with startups from around the world playing a key role in it. The industry was valued at over $300 billion in 2016 and is expected to grow tremendously by 2022.

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This article is from Yostartups, YoStartups is a Pre Accelerator, and it empowers entrepreneurs to propel their business ideas into successful ventures. Yostartups’ core mission is to take the message of entrepreneurship to 1 billion people globally by 2020.

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