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Founded in 2015, popular ecommerce startup Glazziq has established itself as one of Thailand’s top eyeglasses brands for the younger generation. The company is sells high quality, affordable glasses online and experiencing a healthy average monthly revenue growth of approximately 20% – with no additional help from external investors.

What makes Glazziq unique? Well, the company offers a ‘Home Try-On’ program to allow customers to order up to three pairs of glasses to try on first and for a small deposit that is returned as store credit once items are shipped back.

Sound familiar? The startup is often compared to Warby Parker, a highly successful US based startup that managed to disrupt traditional eyeglasses retailers by providing customers with a similar at-home trial.

Although initially met with a lot of skepticism, the US company is now estimated to be worth over $1 billion and since its inception in 2010, has added over 20 offline stores to assist its online growth. 90% of in-store shoppers have already visited the Warby Parker website and/or plan to make a second or third purchase online. 

The brand’s low prices and O2O strategy have attributed to its accelerated growth and awareness.

It was really about bypassing retailers, bypassing the middlemen that would mark up lenses 3-5x what they cost so we could just transfer all of that cost directly to consumers and save them money,” says Warby Parker co-founder Neil Blumenthal.

The successful integration between offline and online channels has created a unique browsing experience and propelled Warby Parker to be one of the most popular choices in North America for eyeglasses and Glazziq aims for the same success.

Although similar, Glazziq identified the demand for this kind of business model in Southeast Asia but adapted it for the region – all without the help of any external funding. How? With a smart business model, some traditional retail experience, dedicated founders and a market with high demand for spectacles.

Euromonitor forecasts that glasses in Thailand is expected to maintain a compounded annual growth rate of 5% to push sales to reach $13 billion by 2021. With so much potential, it’s surprising no company in Thailand has found a way to sell better to the digitally adept generation.

Equipped with an MBA from Kellogg Business School, on-the-ground experience from her family’s own 50 year old glasses retailer Better Vision and SET listed global lens manufacturer Thai Optical Group, co-founder & CEO Prinda Pracharktam decided to build Glazziq.

Prinda shared that people often admitted they felt pressured under the watch of a salesperson and unwilling to pay high prices for brand name frames and lenses. Others were overwhelmed by the sheer selection of eyeglasses. Glazziq wanted its frames to be affordable and designed to suit the tastes of its target market of 20-35 year olds.

The online glasses store was born to be the solution to these particular pain points so now how could they keep its fickle millennial demographic engaged?

The Glazziq Experience: Laid back, Trendy & Fresh  

When Glazziq was founded two years ago, Prinda and three other co-founders did everything in-house from snapping street style images of casual models to running online marketing campaigns and optimizing the design of the website.

By focusing on quality web content to mirror the appeal of flipping through a glossy magazine, Glazziq elevated the browsing experience for its customer. The company borrowed the same concept Instagram and Facebook fan pages used to keep their audiences engaged –  relatable content that inspired.

And this concept is evident in each collection from Glazziq. There is a clear focus on “everyday” imagery and the company keeps its product line trendy through a new model release every quarter and offers over 170 styles.

By creating a fresh and visually appealing shopping experience for browsers, Glazziq removes the pressure to buy and instead provides the customer with everything they need to make an informed and satisfying purchase: multi-angle views, information on glasses material, styling examples, etc.

“Glazziq focus on personalization to improve brand loyalty,” says Prinda. “We cater to our customer’s unique tastes by providing them with styles that are either popular in magazines or edgy frames that can’t be found elsewhere.”

glazziq thailand

The Glazziq Model: DTC

Glazziq operates on a direct-to-consumer model. The startup manufactures the glasses themselves from custom designs and leverages resources from its partner, Thai Optical Group. This allows Glazziq to keep prices affordable while maintaining high quality, models start at $56.26.

The company operates like a fast fashion brand in charge of its operations and brand identity, bearing similarities to the business model of another highly successful Thai fashion brand Pomelo.

Glazziq’s extensive offline network gives it an advantage over other online platforms. Prinda shares that Glazziq’s UV400 color lens provided by Thai Optical Group is unique only to them and they collaborate to keep up with consumer trends. The company also works with Better Vision to offer a free eye prescription test and after sales care including frame repair, frame adjustment and lens replacement, all the crucial components that are often missing from purchasing eyewear online.

To ensure efficient supply chain operations, order information from a customer is sent directly to the lens manufacturer where Glazziq stores its frames. The product is then assembled and delivered directly to customers nationwide through a mix of third party logistics couriers. The return process is also simplified through Glazziq’s partnership with 7-Eleven that makes its “Home Try-On” program even more appealing.

Customers can return sample glasses from the program to any 7-Eleven branch – something that happens 10-20% of the time. The program has proven to be successful as home try-ons welcome a healthy 60% conversion rate. Although the company’s primary focus is on Thailand, the team plans to expand to Singapore and Malaysia where Better Vision is also present.

The Glazziq Future: Integrating Offline Touchpoints

The Glazziq team knew when they launched that they wouldn’t remain a pure online brand and began to tread the offline waters in 2016. Glazziq’s decision came from a cautious outlook on Thailand’s landscape – the country’s ecommerce industry is predicted to make up 15% of total retail sales by 2024, although a sizable jump from the current 3.8%, it would still leave a staggering 85% offline presence.

“Thailand still remains a thriving offline retail landscape, people are never going to stop shopping in department stores or malls,” Prinda comments.

So came the decision to launch an offline showroom in one of Thailand’s bustling office districts in a coffee shop called Printa Cafe.

“We didn’t want a typical brick and mortar store. Using a high-traffic location such as a cafe gives our products a lot of exposure and the relaxed environment encourages people to try on different designs between cups of coffee. We wanted something entirely different from going to an eyewear store with a sales attendant breathing down your neck. We hope customers purchase because they’ve found a suitable model they like,” Prinda comments.

And it seems to be working as Glazziq recently added a second offline location to its portfolio at Casa Lapin – a coffee shop and co-working space highly frequented by young professionals.

Glazziq’s second offline showroom at Casa Lapin, a popular coffee shop and co-working space in a busy area in Bangkok.

Glazziq’s first showroom at Printa Cafe, located below the startup’s HQ.

To buy at the showroom, shoppers can simply scan the QR code on the product or buy online through the site’s search function. The customer can then make an online transaction via credit/debit card payment or bank transfer and the product is delivered within 5-10 business days.

Prinda believes Glazziq’s offline presence will double the number of sales and bring more awareness to the company’s “Home Try-On” program. It also hopes the added exposure will give the brand a new audience who will enjoy the entire Glazziq experience.

“Every channel has its own forte. For our brand, it’s better to close sales online and tend to customers offline,” Prinda says. “You have to synchronize and blend both online and offline experiences in order to succeed.”

THIS ARTICLE WAS BASED ON eIQ’s INTERVIEW WITH GLAZZIQ FOUNDER, PRINDA PRACHARKTAM

Glazziq plans to expand regionally as they find success selling high-quality, affordable glasses designed in-house and made on OEM basis in Thailand, reports The Nation.

The Warby Parker model success

“It was really about bypassing retailers, bypassing the middlemen that would mark up lenses 3-5x what they cost, so we could just transfer all of that cost directly to consumers and save them money.” – Neil Blumenthal, Founder of Warby Parker.

Based on the popular American glasses brand, Warby Parker, Glazziq will deliver the frames to customers at home, for which it charges a deposit of 300 THB, which be returned as a full credit, she said, adding that once they have finished their trial, customers can simply drop off the frames at any 7-Eleven store around the country.

glazziq, Ecommerce Startup Glazziq Plans to Expand Regionally

Source: tcdcconnect.com

Customers can get their eyes tested for free and a prescription issued at any of over 100 Better Vision – or Hor Wan – eyewear stores nationwide.

The prescription will then be automatically put into the www.glazziq.com system for matching with the order, and sent directly to the factory where the frames and lens will be assembled and despatched to the buyer’s home address.

Customers will receive the finished products within five to 10 days of their prescription entering the system

The website, launched last December, has already grown to more than 100 orders being placed monthly.

The company plans to expand to Malaysia and Singapore next year, with the eventual goal of becoming one of the largest eyewear ecommerce operators across Southeast Asia and Asia-Pacific, the Chief Executive, Prinda Pracharktam said.

The standard business models in Southeast Asia are looking to the West to successfully adapt to the ever-changing customer demographic in Asia while remaining focused on the local market. Glazziq is a perfect example.

A version of this appeared in The Nation July 14. Find the full version here.

Why We’re Heading Towards a Bloodbath and 4 Strategies to Avoid it

Being the new kid on the block means that ecommerce ventures in Southeast Asia have the luxury to learn from the mistakes of others from mature ecommerce markets like the US and China. It has been over 20 years since Amazon (1994) and eBay (1995) were founded, Jack Ma started Alibaba in his Hangzhou apartment in 1999, right before the Internet 1.0 bubble burst.

A lot has happened in global ecommerce since then, including the slow but steady march of Amazon, the quick rise and fall of daily deals and flash sale sites, and Alibaba’s blockbuster IPO in 2015. What’s next? This historical review creates the two frameworks, the Ecommerce Lifecycle and Ecommerce 1.0/2.0, to help predict the future opportunity of ecommerce in Southeast Asia.

1. The Ecommerce Lifecycle – How Ecommerce Models Evolve Over Time

There is a distinct pattern that has emerged from the more mature ecommerce markets’ evolution that offers a degree of prescience for ecommerce in Southeast Asia. This follows the trajectory of Classifieds and C2C to B2C to eventually Brand.com. The US went from Craigslist, eBay and Amazon to brand sites like Nike, J.Crew and Gap. China went from Taobao, Tmall and JD to the many standalone and marketplace brand sites, like Estée Lauder, Burberry and Coach.

Today’s Southeast Asia is following a similar pattern but at a much faster pace due to “1 to n,” horizontal progress and the resulting leapfrogging behavior. In our region, we have Classifieds (OLX), C2C (Tarad, Tokopedia, Shopee), B2C (Lazada, Zalora, MatahariMall) and Brand.com (L’Oreal, Estée Lauder, Adidas) all happening at once within a very short time frame.

The Evolution of Ecommerce Business Models in Southeast Asia

Figure 1: Ecommerce Lifecycle Model

LIMITATIONS TO THE MODEL

Local nuances give rise to unique ecommerce business models

eBay could only have been invented in the US because of its auction-driven model in a consumerist culture characterized by excess goods and plenty of hobbyists (think baseball cards and Pez dispensers). eBay didn’t work in China for many reasons, one being the auction model was not appealing to Chinese users who preferred to buy first-hand goods and to negotiate person-to-person via chat.

Tmall’s B2B2C model originated in China because of the bazaar-like, hustle and bustle shopping environments that many Chinese were used to in their offline world.

HOW SOUTHEAST ASIA ECOMMERCE IS DIFFERENT

Southeast Asia is a hybrid between the US and China

Lazada, the dominant ecommerce platform in Southeast Asia, is both an Amazon and a Tmall. Founded in 2011 by Rocket Internet as the “Amazon of Southeast Asia”, Lazada today gets 70% of its GMV from third-party, marketplace transactions, with the remaining 30% generated through “traditional” Amazon-style direct retail. Post-Alibaba acquisition, it’s likely that Lazada will follow the Tmall model and move towards a 100% marketplace with all the model’s inherent scaling benefits.

Compare this to Amazon, which traditionally used to be 100% direct retail but has been moving towards a marketplace model. Today, Amazon gets 59% of its GMV from B2B2C.

B2C, B2B2C and Brand.com all happening at the same time

In China, brands progressed from selling via Tmall as a stepping stone towards operating their own brand.com site. A case in point is Uniqlo, which started selling through a Tmall flagship store and then later added their own brand.com webstore.

In Southeast Asia, we see brands doing both at the same time, selling via Lazada as well as their brand.com stores, in addition through distributing through e-tailors like Central Online and MAP. This is driven by technology making it much easier to sell through different channels but also necessitated by the high degree of fragmentation in the ecommerce market. Consolidation is expected to happen soon.

Southeast Asia is mobile-first, C2C ecommerce is jumping straight into mobile marketplaces

Whereas in mature ecommerce markets desktop C2C still plays a pivotal role, in Southeast Asia the leapfrogging towards mobile is disrupting traditional, desktop-first marketplaces. Mobile-only C2C marketplaces like Carousell and Garena-backed Shopee are making aggressive moves against their older desktop counterparts like Tarad in Thailand and Tokopedia in Indonesia. With an estimated 85% and 79% of online shopping outside of the major metro areas in Thailand and Indonesia happening on mobile, it’s not surprising that companies like Facebook are also betting on mobile C2C. The ad giant recently launching mobile payments in Thailand where an estimated 50% of C2C transactions are happening on social networks.

2. Ecommerce 1.0 to Ecommerce 2.0: 4 Strategies to Avoid the Imminent Ecommerce Bloodbath in Southeast Asia

Southeast Asia is the next ecommerce gold rush. For this very reason, it’s also quickly becoming the next ecommerce bloodbath. We’ve already seen many casualties, especially in the B2C space of selling third-party brands. As we previously predicted, Rocket Internet’s Zalora had to sell their Thailand and Vietnam businesses for chump change to local retailer Central Group. This same year, Cdiscount Thailand, part of French retail conglomerate Groupe Casino, was sold for $31.5 million (28 million EUR) to TCC, a local Thai company that also owns the popular Chang beer brand. 

Ecommerce 1.0: Selling other people’s stuff to the masses at low margins

Ecommerce guru Andy Dunn adopted a strategy that allowed his business to stand a fighting chance in the Amazon bloodbath of the US.

“If you’re selling other people’s brands, you are competing not via a local group of competitors but with everyone. In this type of market, you might imagine having one large national winner. You might imagine that winner is ruthless about scale and cost, and is run by a visionary leader who with an extreme long-term focus. Such a company might not make real money for a long time — but when it does — it will be incredibly powerful.”

With Alibaba coming into the region through the $1 billion Lazada acquisition, it increasingly looks like ‘Alizada’ is becoming the big threat for other retailers in the market, both in the pure-play and omni-channel space. Expect the bloodbath to intensify and more consolidation to happen over the next few years.

Today, none of the B2C / Ecommerce 1.0 players in ASEAN have dominant market share yet.

Granted, Lazada has a headstart with an alleged 20% market share (2014) but this number pales in comparison with Amazon’s 60% in the US, Tmall’s 50.6%, and JD’s 51.9% (direct retail B2C market) in China.

ecommerce 1.0, The Evolution of Ecommerce Business Models in Southeast Asia

The Ecommerce 1.0 Goliaths

Over the next 5-6 years, Southeast Asia B2C will go through further consolidation to end up in a 1-2 player game

There is no better way to visualize the ongoing consolidation in Ecommerce 1.0 than with ‘search interest’ data from Google Trends. The graph for Thailand shows the rise and fall of desktop C2C and daily deals, the fragmentation in B2C, and the rapid ascension of Lazada.

google trends, The Evolution of Ecommerce Business Models in Southeast Asia

Figure 3: Google Search Interest Showing Ongoing Consolidation in Ecommerce 1.0

This is where things start to get interesting. Whereas Ecommerce 1.0 is a game of brute force and strength, Ecommerce 2.0 exploits 1.0 loopholes in many creative ways in order to avoid the zero-sum game against the likes of ‘Alizada’.

“This next generation of ecommerce companies is as much about what you exclude as what you include. It is a paradox that excluding some things takes more time than including everything. The new models are fundamentally — whether the merchandise is proprietary or not — about merchandising.” — Andy Dunn on Ecommerce 2.0

The Evolution of Ecommerce Business Models in Southeast Asia

Figure 4: Ecommerce 2.0 – Four Strategies for Avoiding the Bloodbath

Gilt, the posterchild of Ecommerce 2.0, rose from the ashes of the 2008 financial crisis with a unique business model that offered high-end luxury goods at a fraction of their original price through time-sensitive flash sales. One of New York City’s first unicorns at a point in time, Gilt later struggled as the economy recovered and brands no longer needed a distribution channel for clearance stock.

While Gilt played the pricing angle, others like Birchbox and Rent the Runway innovated on the product side by offering a unique shopping experience. Birchbox started the monthly beauty subscription commerce craze and inspired countless “Birchbox for X” clones. Rent the Runway is basically fashion on-demand by providing users rental access to high-end, designer fashion.

Ecommerce 2.0 in Southeast Asia: A glimpse of hope for aspiring ecommerce entrepreneurs?

With the Ecommerce 1.0 bloodbath in Southeast Asia still ongoing as we speak, a few entrepreneurs have realized that it’s futile to compete against the Lazada’s and MatahariMall’s of the region without deep pockets or any other strategic moat. Instead, they are focusing on emerging opportunities in Ecommerce 2.0 by positioning themselves in a unique way.

Proprietary Merchandise

Pomelo Fashion

Founded by the ex-Thailand Lazada founding team, Pomelo Fashion is one of the first Ecommerce 2.0 companies in Southeast Asia. Rather than selling other brands’ products with low margins, Pomelo Fashion has taken a M2C/D2C (Manufacture / Direct-to-Consumer) approach, focusing on building its own fashion brand and vertically integrating its supply chain, going as far as manufacturing its own clothing and apparel.

The Evolution of Ecommerce Business Models in Southeast Asia

Glazziq and Franc Nobel

Inspired by Warby Parker’s success in the US, Glazziq and Franc Nobel are applying the proprietary merchandise model in the eyewear space in Thailand and Indonesia, respectively. Glazziq adds a local spin by positioning itself as prescription eyewear for Asians.

The Evolution of Ecommerce Business Models in Southeast Asia

Sale Stock

In Indonesia, another startup has taken a cue from the Facebook and Instagram seller playbook, and scaled it 10x. Sale Stock, a fast-fashion startup based in Jakarta has taken a similar path to Pomelo Fashion, with vertical integration of design, manufacturing, and supply chain.

Proprietary Selection

Motif Official

Motif Official is a fashion retailer based in Bangkok focusing on proprietary merchandise and selection. Their ‘Motif Official’ label is designed and manufactured in-house. For their ‘Motif Select’ range, they select and curate minimalist brands from across the world. Motif’s ecommerce strategy eerily resembles that of Nasty Gal in the US, where founder Sophia Amoruso started the business in 2006 by curating vintage clothing sourced from second hand stores.

The Evolution of Ecommerce Business Models in Southeast Asia

“We are an online concept store specializing in women’s apparels and accessories; from our own in-house label ‘Motif Official’ to our ‘Motif Select’ range, where we curate the best pieces from brands all around the world to your everyday wardrobe. We believe in the concept of minimalism, with attention to details, shapes and silhouettes.”

Motif proves that you can still compete with the big retailers by focusing on a niche and dominating a category through curation. Many of the premium brands on Motif would never sell on Lazada, let alone Zalora.

Following pure play ecommerce companies in the US like Warby Parker and Birchbox who went offline to augment their brand, Motif also operates physical stores in Central World and Siam Discovery in the heart of Bangkok.

 

The Evolution of Ecommerce Business Models in Southeast Asia

Figure 5: Ecommerce 2.0, Global vs SEA Comparison and Opportunities

The Future of Ecommerce in Southeast Asia

Applying either the Ecommerce Lifecycle or Ecommerce 1.0/2.0 framework makes it easy to see where ecommerce in Southeast Asia is headed.

The B2C war will continue to wage for the next 4-5 years until some run out of money and throw in the towel. In China, this process took almost a decade with Tmall going from 0% to 50.6% market share from 2008-2014. In the direct retail B2C space, JD went from 15% to 51.9%. In the same period, previous leaders like Dangdang (16.2%) and Amazon China (15.4%) faded into irrelevance with 4% and 3.5% market share remaining as of 2014.

During this time, we will also see more startups and venture capital going into the Ecommerce 2.0 space. Ecommerce 2.0 isn’t new to Southeast Asia— many have tried to bring the Birchbox model into the region but failed due to the immature market. However, the next few years may be a fertile time as evidenced from the traction that companies like Pomelo Fashion, Sale Stock, and Motif are getting.

Does this mean we can go ahead and copy something like Gilt into Southeast Asia? It really depends. A model like Gilt needs access to old inventory of premium brands which in markets like Thailand and Indonesia are controlled by 1-2 distributors such as Central and MAP. This is the same issue that caused the downfall of Zalora in the same markets. Any Ecommerce 2.0 model launched in Southeast Asia will need to be customized for the local market.

Ecommerce in Southeast Asia is still relatively young, with only 1% of total retail GMV being generated online compared to 7.1% and 15.9% in the US and China. However, the region is already widely being touted as the next frontier of ecommerce opportunity, or the next ecommerce gold rush and recent research predicting the market to grow 32% year-on-year to reach $88 billion by 2025 (6.4% penetration), up from today’s $5.5 billion (0.8% penetration). As shown in our analysis, there are plenty of opportunities in ecommerce for those with deep pockets as well as those who adopt unique and local strategies.

“Don’t always go through the tiny little door that everyone is trying to rush through… maybe go around the corner and go through the vast gate that no one’s taking.” — Peter Thiel

By Sheji Ho

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