Moving out of the red, and still flush with its last investment round, which netted $165 million from Apax Digital and Chow Tai Fook heir Adrian Chen, Moda Operandi is looking to the East for growth.
“In the past, it was about sales and margins,” said the company’s chief executive officer Deborah Nicodemus. “Now it’s about profitability. Sales, margin and EBITDAs [earnings before interest, taxes, depreciation and amortization].”
The luxury e-commerce site had a presence during the recent Hong Kong Art Basel with a Style Suite at Upper House in Central Hong Kong, and is looking for permanent space for a consumer-facing showroom. “It’s something we’re currently working to secure,” Nicodemus said. “We hope to have a physical showroom in the region within the next year to year-and-a-half.”
Moda’s overseas business grew 69 percent last year, and Asia represents 8 percent of that. Nicodemus said China, Singapore and Seoul are also on the short list for showroom locations, which is the company’s version of stores.
Domestic business, which represents 65 percent of sales, also had a strong performance, posting a 50 percent increase over last year. Standout categories included nonapparel, which soared 70 percent, and fine jewelry, which shot up 147 percent.
“Moda’s top customers were the big drivers of the business,” Nicodemus said. “For that top tier, sales were up 83 percent. Clients are spending more with Moda. The average order is close to $1,300, which is up 6 percent.
“We’re embarking on an international expansion right away,” she said. “Our senior team is looking at taking the expansion plan to an operational level.”
Luxury fashion consumers and tourists visiting Hong Kong for Art Basel made up Moda’s customer base. “We know consumers in Hong Kong are fashion-forward and savvy when it comes to how they shop,” Nicodemus said. “They’re looking for the best of the runway along with access to emerging designers.”
The Style Suite offered looks from the fall 2018 collections “that just walked the runway the previous month,” Nicodemus said. “They likely hadn’t seen the collections yet, unless they were at the shows this season. We also brought a selection of fine jewelry with some one-of-a-kind pieces.”
The trunk show model isn’t new to the region, Nicodemus said, adding that Moda has existing customers in Asia. While other retailers tend to buy a designer’s most commercial offerings, Moda features the entire collection through its trunk-show model. “During Hong Kong Art Basel, we had a team of Moda stylists on the ground to help educate new customers about our trunk-show business,” the ceo said.
Moda has been developing its nonapparel business, and Nicodemus sees in Hong Kong an even split between ready-to-wear and nonapparel purchases. “Our clients in Asia gravitate toward our marquee brands and emerging designers,” the ceo said. “They love well-known brands such as Giambattista Valli and Marchesa, and also Johanna Ortiz, Monse and BOYY. The coveted brands run a wide range, which is exciting because we have the capacity to cater to both ends of the spectrum.
“It’s a Millennial customer who’s interested in emerging talent,” Nicodemus said, adding that Moda is leveraging KOLs (key opinion leaders) in Asia. “We understand the importance of KOLs as a key vehicle in communicating our offering since many customers look to these personalities for fashion inspiration,” she said. “Working with this influential network helps give us brand credibility since they’re widely respected. We’ve already started to engage with influencers in the region through activations focused on key business initiatives such as fashion month and The Platform.”
The Moda site continues to evolve. A recent modification included a feature for sorting products by category, not simply designer. That way, for example, consumers can view all of the dresses at once.
The online retailer is mining the abundance of customer data it collects to leverage it and cater to global clients. “We know our customers like to communicate and shop in a variety of ways, including services provided by our stylist and customer care teams via phone, Live Chat, social media and e-mail,” Nicodemus said. “We ensure the entire experience is personal and managed by us.
“We realize that personalization is key to improving the user’s experience,” she added. “We’re leveraging client behavior data to create efficiencies by enhancing our CRM program to ensure that we can address customers in a more productive and quicker manner.
“We’ll continue to build out nonapparel,” Nicodemus said. “Our home test was successful and we’re building out a dedicated section for home on the web site. We’re launching a full assortment of men’s wear and accessories on the site this summer. It will be a mirror of women’s.”