The Iconic has grown to take the crown as Australia’s largest online fashion website in just five years.
Now the company has launched its next stage of growth, moving to a new, larger headquarters and warehouse in Yennora, NSW. The centre is equivalent to three football fields, which they’re calling “Australia’s largest fashion wardrobe”.
The $10 million centre will hold 700 brands and more than 45,000 different products.
At a time when the retail industry is facing uncertainty with the looming entry of global e-commerce giant, Amazon, and high profile bricks-and-mortar businesses closing due to what some are calling “the retail apocalypse,” we spoke to The Iconic CEO Patrick Schmidt about what it means for his business and the sector more broadly.
* The transcript below has been lightly edited for clarity.
BUSINESS INSIDER: What has been the biggest impact on the Australian retail industry in the past five years and how has The Iconic managed to stay on top during the shift?
PATRICK SCHMIDT: In just a few years we’ve seen a tremendous increase in customer desire for shopping on a mobile device because people are doing more and more with their phones these days. They’re browsing content, they’re searching for the closest restaurant, visiting Facebook, and they’re using smartphones contextually throughout the day. It’s logical that they also want to buy product with their phones, too.
Two years ago mobile represented a third of our traffic; today it’s more than two thirds. Our iOS and Android apps have been downloaded on more than one million devices so far, and we continue to invest in the quality and the speed and the experience across these apps, both built in-house by our incredibly talented team of engineers who constantly work with our customers to innovate for their experience and enjoyment. For example, we have a daily feed on the app, aptly called “The Daily” – users of this feature have doubled in just the past six months alone. Our priorities are shaped by our customers’ requests, and clearly customers want an amazing mobile experience.
BI: What has been the biggest challenge for the business as it scaled? How did you overcome it?
PS: Our biggest challenge is also our biggest opportunity given that in many ways we’re operating in a young industry with essentially no playbook. We are creating a shopping experience for Australians using technology which didn’t even exist a few years ago, and we get to come to work every day to try, test, invent, fail and learn.
In just five years we’ve grown from a handful of people working on picnic tables to a team of more than 450 of some of the smartest and most passionate people I’ve ever worked with. Staying focused on a very clear shortlist of priorities can be a challenge when there are so many exciting things we want to do all at once because we truly have the team and the talent to try it. But as CEO, I could have worse problems!
BI: What is The Iconic’s strategy for its next stage of growth? And how will what you’re calling your “Fulfilment Centre” assist in the brand’s growth?
PS: It’s simple: focus on the best possible customer experience. Everything we do starts and ends with the customer and that continues to serve us well.
We’ve made the decision to move into a much larger space now, based on our journey over the past few years and to accommodate future growth through 2020 and beyond.
To provide the best experience for our customers means we must continue to offer the world’s best product assortment of global and local brands and designers. Our considerably larger space ensures we have the space to keep up with rapidly increasing customer demand for the latest in fashion.
BI: What are some of the new technologies being implemented to assist with this growth?
PS: There are so many possibilities for The Iconic, but I strive to keep us focused on the few areas I believe will take our platform to the next level and serve our customers best. We are placing big bets on personalisation technology, which will make every single customer’s shopping experience unique to their individual preferences. Think about it – when you enter a brick and mortar retail shop, the store looks the same for the hundreds or thousands of consumers who might go through those doors over a busy weekend. Technology gives online retailers the special capability to customise the shopping experience down to the finest detail. Rather than one shop, we can be a different shop for each unique visitor.
Whenever we release new personalisation features we get extremely positive feedback from customers. We recently introduced the ability for consumers to follow their favourite brands on our app. This means when they jump onto the app on their smartphones they can see which products have launched from their favourite brands and they can stay up to date with the latest trends. You can effectively curate how your version of The Iconic appears. We are keen to further this type of experience in the years ahead.
Likewise, customers told us that sizing can be challenging when shopping online. Though we offer free returns to ensure convenience if you want to try on different sizes, this feedback inspired a “find my best size” feature we recently rolled out which prompts customers to enter their measurements, and then suggests the best size for you for any item on the site. Technology is absolutely the future of creating shopping experiences that consumers enjoy and look forward to.
BI: How do you see Australian retailers innovating to ensure they are part of the future of retail?
PS: We realised in our very early days that nothing is more important than taking the time and proper measures to get to know the customer – both the customer you have, as well as the customer you want to serve. We’re not afraid to admit that we’ve made plenty of mistakes in the past but ultimately we’re at the point where we’ve got the right product assortment that our customers want, and we’re at the stage where they keep coming back for more. This wasn’t necessarily the case when we launched, but we’ve spent the time to know them better and therefore better serve their needs.
While it may seem basic, this is advice I’d share with our local industry peers, and I also think it’s worth looking to some of the industry leaders overseas for best practice inspiration.
There are reports that the US is going through a “retail apocalypse” of sorts, do you think Australia is just as vulnerable to such an event occurring?
From my perspective, this is the time for traditional retail to get online and make the effort to do it well. In Australia, rents and fixed costs are high, especially in capital cities with the most foot traffic. There’s huge opportunity for e-commerce in Australia, and we’re still truly at Day One compared to markets like the US and the UK who have been shopping online for longer. I saw data recently that suggests a current $2 billion discrepancy between the online fashion market in Australia vs the US. It’s time for local retailers to help close that gap.
BI: How do you expect the entry of Amazon to impact The Iconic?
PS: The Iconic is focused on the inside-out first, and this will be a big year for us. We are on a clear path to becoming sustainably profitable, we have moved to a larger fulfilment centre to accommodate our growing customer demand; and we continue to invest in compelling and engaging marketing strategies and creative campaigns.
We are Australia’s largest online fashion and sportswear destination and we plan to be for many more years to come.
BI: How do you expect the entry of Amazon to impact the broader retail sector in Australia?
PS: We encourage competition in the online buying space because it provides consumers with more options, raises the bar for the industry, and drives online shopping behaviour, which can only be a positive thing for us all.
BI: How do you expect the entry of Amazon to impact the online shopper in Australia?
PS: Australians deserve the best online shopping experiences and we’re proud to be an e-commerce pioneer in this market. We believe that technology enables unparalleled convenience, ease and enjoyment for consumers who love to shop for fashion and all their other needs.
It’s a great time to be playing in the online retail space and we’re excited for what the future holds.
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