Fashion e-commerce start-up Berrybenka recently opened a physical store in a popular shopping mall in Jakarta.
It’s the company’s second permanent store so far – there’s another one in a different mall, in addition to a handful of temporary pop-up stores. Besides raising brand awareness, the offline shops have proven to help boost Berrybenka’s sales, CEO Jason Lamuda said in an interview.
“When we first opened pop-up stores, we were surprised because they were able to quickly return our investment. That’s why we continued opening more in other spots.”
These stores serve multiple purposes. You can buy Berrybenka clothes on display. But you can also have your online orders delivered there and pay for them in cash. You can also return things you ordered on Berrybenka if they don’t match your expectations.
Jason says opening offline shops is easy for Berrybenka because it has its own labels and collections so there’s no need to coordinate with merchants.
More offline stores don’t mean Berrybenka is shifting away from its online business. It’s still hoping to grow both online and offline sales, and believes physical stores will serve as a bridge that helps boost both.
The Trust Gap
Established in 2011, Berrybenka is one of Indonesia’s early local players in fashion e-commerce. The start-up raised seed funding from East Ventures in 2012, followed by multiple investment rounds in the following years, from VCs like Gree Ventures and TransCosmos. After a minor restructuring in 2016, Jason had to trim down Berrybenka’s team size, but was able to secure new funds – an “eight-figure amount” in US dollars from Maj Invest Private Equity, Asia Summit Capital, the SoftBank-Indosat Fund, and other local investors.
As part of that investment, Jason revealed plans to build online-to-offline (O2O) touch points, and to strengthen Berrybenka’s presence on messaging apps like WhatsApp, Facebook Messenger and Line. The company’s competitors in Indonesia include Zalora, which is backed by Rocket Internet’s Global Fashion Group and local start-up Sale Stock.
Zalora has also experimented with pop-up stores in Indonesia and countries like Singapore and the Philippines. It operates regionally. The purpose of these stores was to “fill the trust gap” Zalora Group’s managing director Tito Costa said in an interview in 2015.
Until now, a good proportion of consumers still isn’t confident about shopping online, as a recent report by Macquarie Research found. Zalora, unlike Berrybenka, hasn’t opened any permanent store locations yet. It also currently doesn’t run any pop-up stores in Indonesia.
Can you see how important is O2O? You have to consider adopting O2O in your business if you are an e-commerce operator.
Source: Tech in Asia