Daniel Lim started his entrepreneurship journey as an undergraduate at the Singapore Management University (SMU), together with Reebonz’s other co-founder, Benjamin Han. Daniel has always been interested in business and in particular, e-commerce. Recognising the potential in the Asia Pacific consumer market, Daniel along with Benjamin came up with the concept of a luxury e-commerce platform. In March 2009, with other founding members, they launched Reebonz in Singapore. Today, Daniel’s team has expanded into 8 countries within the region, with offices in Singapore, Malaysia, Indonesia, Hong Kong, Taiwan, Thailand, Australia and Korea. Today, Daniel shares with The Asian Entrepreneur, his incredible journey.
In your own words what is Reebonz?
Reebonz embodies my aspiration to make luxury accessible, by providing Asia Pacific shoppers with a trusted platform for buying and selling the widest range of luxury products across our luxury eco-system, providing a seamless shopping experience for everyone.
Reebonz is designed to connect shoppers to the world of luxury through three ways: as a luxury B2C e-tailer (Reebonz), a marketplace platform for individuals (C2C) to buy and sell pre-owned luxury goods (Closets), and allowing shoppers access to multi-brand luxury boutiques without a presence in Asia (Reebonz Marketplace).
What is Reebonz’s position in its industry?
Reebonz is the leading luxury e-commerce retailer in Asia Pacific, with a presence in 8 countries within the region and over 300 employees in offices across Singapore, Malaysia, Indonesia, Hong Kong, Taiwan, Thailand, Australia and Korea.
Reebonz is different in that we were one of the first entrants in the luxury e-commerce space and we have evolved over the years to continue to stay ahead of the pack. The brand was conceived based on two key industry trends that emerged in 2009: first, e-commerce was incipiently taking off in Asia Pacific; second, the global financial crisis also meant many brands and companies were dealing with an overstock. As such, they were turning to new avenues to liquidate inventory.
Recognising this as an opportune moment to make our first move into the luxury e-commerce space, Reebonz was built on the idea of making luxury accessible and that vision continues to drive our business’ growth today. Strategies have obviously evolved, but the single idea crystalised a large portion of the company’s doings over the past 7 years, and has yielded results that prove that we are on the right track. We benchmark ourselves against the best in the industry and constantly innovate to keep Reebonz ahead of the competition.
How has Reebonz been developing in the last year?
In the last year, we have focused on expanding our luxury eco-system, having the widest range of luxury products and solidifying our position as part of our customers’ luxury consumption journey. We also understand that success in the e-commerce space is also largely dependent on your inventory, which we have managed to grow by tapping on consumers and merchants around the world. For the latter group, we launched Reebonz Marketplace after identifying the likes of merchants, boutique owners and luxury resellers, who were looking to buy and sell luxury borderlessly. The online marketplace opened up another avenue for consumers to access luxury, either via lower price points, or in vintage models and styles that are otherwise hard to access.
Reebonz has also been evolving our customer service. We ensure that we are constantly listening to customers’ feedback and strive to tighten/shorten processes to make their shopping experience even more seamless.
We have also been opening pop-up stores in strategic locations to bring our products and services nearer to our customers. Our latest pop-up in Singapore is situated within Plaza Singapura, within most prominent shopping belt in Singapore.
Has there been any changes in consumer behaviour for luxury products in Asia?
The luxury market is probably one of the slowest industries that has adopted e-commerce but that’s slowly changing. In developed markets such as Singapore, Hong Kong, Taiwan and South Korea, people are well-connected, average incomes are higher, and they have physical access to luxury stores – so in terms of these markets, it is about shifting their behaviour to online.
However, for middle markets in Asia, such as Malaysia, Indonesia, Thailand, Vietnam and Myanmar, there is an aspirational middle class, although the group is still quite small at this point in time. But we definitely see this growing in the next three to five years and these people will start to access luxury in a different way.
For these developing markets, their way of accessing luxury may not necessarily be through a computer desktop – in fact, they might completely bypass the e-commerce phase of using the web browser and go straight to mobile. For example, in Indonesia, 65% of Reebonz’s revenue comes from our mobile app only and the number is even higher if you include mobile web. Therefore, Indonesia is a country where the middle class have completely bypassed desktop and gone straight to mobile. We had to cater to their needs, and we have successfully done so, through great apps and a mobile-optimised site. The potential for online luxury consumption in Asia definitely seems to be a stable trend that Reebonz is riding on.
Overall, we have also noticed a higher demand for niche/cult brands that has grown tremendously in the last few years, in addition to a growing segment of younger customers that are starting their luxury consumption journey with Reebonz.
How has Reebonz been working to connect to luxury product consumers?
The strategies we use at Reebonz are very much data-driven and as a pioneer in the e-commerce space, we continue to stay innovative.
A key example would be Reebonz Closets, launched in January 2015, which uses a C2C business model that allows customers to create liquidity with their luxury merchandise. It was created as a trusted platform for luxury consumers to buy, sell or trade their luxury pieces in simple steps. Closets has a community of over 4 million users across Asia Pacific and over 10,000 transactions were completed within our first year of business.
We’ve recently relaunched Reebonz Closets in July 2016 as a standalone app that offers a more seamless buying and selling process for users, and growing the use of the platform is one of key priorities. A focus will be to market Closets to a wider audience and grow the online community of engaged users across the region.
Our core strategy has always remained – at Reebonz, we understand the importance of trust and promise authenticity in all our products, across all platforms, allowing our customers to shop with confidence. We have in place a 100% buy-back /trade-in guarantee for pre-owned Reebonz items in either cash or store credits (terms and conditions apply).
How does Reebonz play to secure itself against competition?
As the luxury fashion business is always changing we are constantly challenging ourselves to take innovation to the next level by relying on the latest technology advancements to ensure our consumers are connected across multi-platforms.
We are the most trusted luxury online platform with more than 4.5 million members to date; and the third largest e-commerce business based in Singapore, shipping to over 20 countries around the world.
We carry over 100,000 SKUs from more than 500 brands to satisfy Asia’s consumer appetite for luxury; and have expanded to bricks and mortar – also known as Reebonz SPACE in Singapore and Australia, reinventing what has traditionally been a physical-to-digital approach among retailers.
What’s unique to Reebonz is our luxury online ecosystem trusted by luxury buyers and sellers.
Beyond the provision of a seamless shopping experience, an essential part of our business is ensuring the best services and experiences are delivered at every single customer touchpoint. We offer unparalleled delivery services, where all orders are delivered within three working days – imagine getting your hands on the extravagance of Hermès, without the hassle of a drawn-out wait!
With a customer-centric approach to business, our consumers always come first. We believe an authentic brand experience is just as important as the authenticity of our products. Therefore, we keep ourselves on the toes of technology and aim to stay ahead of the curve of innovation: this is to provide our customers with an exceptional shopping experience, which will help us foster a community of loyal customers who trust us, and whom we support.
The Reebonz luxuy ecosystem includes a range of unique services that build trust with our customers and aims to put their minds at ease when shopping with us. For example, every item listed on Reebonz has been put under the most rigorous testing to meet the highest standards of quality. All our products are closely examined by our professional Reebonz Atelier team before they are issued a Reebonz Atelier Authenticity Card. Customers can look up the authentication process on the Reebonz website, where they can understand the extensive process our Atelier team goes through to guarantee the authenticity of all items.
Since launching in 2009, one of Reebonz’s best marketers are our customers themselves. Word-of-mouth recommendations from our 4.5 million strong community has helped to propel our growth through the years and remains a key factor and allowing us to stay ahead of the competition.
Are there any other industry insights that can be shared with our readers?
The digital revolution has caused tectonic shifts in the retail landscape and the rules of engagement when it comes to luxury shoppers are no longer as they were before. The traditional approach that brands and merchants used to apply for decades, needs to change.
The increasing shift to mobile means that consumers today are increasingly plugged into brands and products with technology opening up new streams of information discovery and they are no longer as easily satisfied with the same old; the way they shop and make purchase
Key to navigating this new world is to understand the luxury consumer, what they are moving towards and evolving retail strategies to keep shoppers engaged and loyal.
An analysis of Reebonz’s data (2014-2015) shows that in Asia Pacific, Singapore leads online shopping while Australia and Indonesia are charting the biggest growth when it comes to buying high-end goods.
Reebonz will be releasing the first-ever Asia Luxury Index in August 2016, the first of our efforts to track the performance of the online luxury ecosystem, which will provide our take on the future of luxury in Asia.
Are consumers in Asia different to those in the West?
The Asia Pacific e-commerce market continues to grow and digital retail sales in the region are growing faster than anywhere else in the world.
T. Kearney reported that the combined retail value of online sales in Singapore, Malaysia, Indonesia, Thailand and Vietnam was estimated to be US$7 billion in 2013. Singapore accounted for the largest share at 25%, while Malaysia and Indonesia each accounted for 20% of total sales. A.T. Kearney expects online retail spending in ASEAN to grow by 25% annually (2013 to 2017) due to increasing purchasing power, growing internet penetration and improved online offerings in the region.
The boom in e-commerce has brought challenges – both brick-and-mortar leaders and major pure-play online retailers are learning that the future of the industry is not merely online, but rather in creative omnichannel offerings that link online and physical shopping .
Recognizing this opportunity for growth, we expanded into Reebonz SPACE, our brick-and-mortar concept in Singapore and Australia, reinventing what has traditionally been a physical-to-digital approach among retailers.
Consumers are increasingly connected, shopping through a variety of mobile platforms and this says a lot about consumer confidence and the adoption of e-commerce, particularly in a region such as Asia where many emerging markets are leapfrogging in their digital evolution.
The quality and final presentation of the product is also important to consumers. We understand the importance of aesthetics, ensuring that when the product reaches our customers, they are excited to tear open the sleek, black Reebonz boxes, which is a key touchpoint in the Reebonz shopping experience.
What is your opinion on Asian entrepreneurship vs Western entrepreneurship?
I believe that the same principles of success applies regardless of location. The two most important attributes for entrepreneurs are adaptability and innovation, no matter what industry they are in.
Any parting words of wisdom for entrepreneurs out there from your personal experience?
There is no perfect product. Ensure that you launch, test and improve the product as you evolve and grow. Study the market before you enter it – understand that not everyone is your customer. Find a mentor and learn from him/her, and be open to their advice. Finally, take calculated risks – first you fire bullets then cannonballs!