Shelley Gare meets the brains behind three innovative fashion websites, and gets a crash course in online fashion economics to boot.
Online fashion promises the glamour of big names and, often, big discounts, but the glossiness of the websites, with their beautiful offerings, fashion news and starry chat, is rarely matched by the warehouses and cramped offices where the creators behind the sites work day and night to spin their online magic ...
With her long, bright-red hair, porcelain skin and firm, private-schoolgirl manner, 26-year-old Kath Purkis presents as both very young and formidably assured. In 2008, at 22, she launched Le Black Book as Australia's answer to luxury fashion site Net-a-Porter. Her funding was her savings from two years working in the rag trade, for designer Akira Isogawa. "So I already had a thick skin; you have to be a tough cookie," she remarks.
For a year, she kept her business plan quiet as she developed it. No one in her family is in retail - her father is an architect - but, she says, she loves fashion and she loves technology. She even created the first mobile application for her site. "I just had to create a widget and incorporate that into it," she breezes. But not everything was under her control.
The week of her launch, with seasonal stock piled up in her office, and after a social-media campaign that had encouraged people to register ahead, she discovered her precious site still wasn't functional. Brainstorming with business advice site Nett produced a solution - selling the stock via a sneak-peek email marketing campaign - that gave her breathing space.
It was a big lesson: take advice; use mentors. Two years on, she needed another reboot. She flew to Europe for a much-needed me-break, read The 4-Hour Workweek by Timothy Ferriss and came back ready for her first "smart risk", diversifying into Le Black Book's first own product: tights that looked like stockings with suspenders. With trepidation and after a lot of homework, she ordered 100 pairs from a Chinese manufacturer in Guangzhou. By the end of the season, she'd sold 5000 pairs.
Her big summer seller has been another own-brand product: $49.95 flat sandals with fluoro Lycra straps called Skins. And Purkis is now broadening her site, selling more of her own product and appealing to all women in sizes 8 to 14, and eventually 16. "No one is doing that range in designer fast fashion. We've had an 83-year-old buy a pair of Skins," she says proudly. "And everyone can wear our maxi dress. In this climate, you have to be competitive.
"I love the fact you can make money while you sleep. You get up in the morning, check your inbox and you've made sales. There aren't many traditional companies in retail that can do that."
In April last year, buyer Marlene Mangioni was working out of her Coogee home as the sole employee in the fashion venture she had dreamed up, backed by multimillionaire Perth businessman Andrew Roberts.
Now, there are 60 staff, and Mangioni, as creative director, along with digital and marketing head Marguerite Kramer, is revamping one of Sydney's first and most successful online fashion sites, mycatwalk.com.au, in a vast and echoing office space on the second floor of a building in Alexandria most notable for the hand-lettered MyCatwalk sign by the stairwell.
Mangioni, 48, looks around the bare-bones area where she and Kramer are seated on repro black leather Barcelona chairs, next to a tiny office kitchen where the staff come and go, and she can't help smiling. In the huge room beyond, rows of young women are engrossed in their computer screens. By the walls are racks of clothes, plastic wrapped. "We make it work," she says.
Her original idea was for a string of smart boutiques around Australia that would resist the trend towards one-label stores and offer, instead, edited collections of brands from the second and third tiers of fashion labels from both here and overseas: Brochu Walker, Theyskens' Theory, L'Agence, Jac+Jack, Bassike and Equipment, as well as shoes, bags and jewellery and - key to Mangioni's vision - advice on styling and unintimidating service.
"The idea is that we know Australian women and know their style," says Mangioni, a tall brunette who is addicted to the minimalism of Equipment shirts, and who worked for 17 years with elite shop owners Belinda Seper and Robby Ingham.
Roberts, whose family sold its share in the Multiplex construction company in 2007 for more than $1 billion, already knew Mangioni and agreed to back her for the bricks-and-mortar shops. By the time she had got back from her first overseas buying trip in June, he had, in consultation with her, also niftily bought up 50 per cent of MyCatwalk from founder Jonathon Reid. "That was very exciting," says Mangioni. "It was one of the top sites in the country. Online is infinity, so the offering can be so broad. It's like adding another store but a huge one."
The site had been pitched at the 18-to-24 age group and offered mostly Australian brands, not quite where Mangioni was heading. She didn't blink; all she had to do was find someone who not only got digital, but also got fashion the way she did.
Enter straight-talking, New York-born Kramer, also 48. In 1998, Kramer ran away from her high-powered job as managing editor of US Harper's Bazaar to find out what the geeks were doing in San Francisco. A year later, she was launching productopia.com, a consumer search blog. A shift to Sydney led to online start-ups for ACP Magazines before she moved to beauty site primped.com.au. "I'm the start-up queen!" she announces. For her, the digital world is "a different type of intelligence, a different way of thinking, or seeing things".
Except the MyCatwalk site now has, for the first time, a bricks-and-mortar presence. Defying retail trends, Mangioni's first four MyCatwalk shops opened in November, with two in Sydney (at Clovelly and Double Bay) and one each in Perth and Melbourne.
While Mangioni took four months to go from buying stock to opening the MyCatwalk shops, Kramer's relaunch of the online MyCatwalk brand, scheduled to go live in early April, is taking longer.
"What most people don't realise is that online takes a lot of money, a lot of time," Kramer says. "You have to get the foundations and the infrastructure right. You don't want to be worrying about the technology once the site is live.
"It's a bear to build - and then it's a bear to feed. It's like, 'What trick do we have up our sleeve today?' It's about creating customisation tools, visuals, product pages, blogs, videos, Facebook pages ..."
Now the virtual and the real work together. Sales assistants in the MyCatwalk shops use iPads to show customers other pieces being held in the online "back room". Customers who buy online receive their goods, à la Net-a-Porter, in elegant off-white boxes lined in charcoal grey, packed with bright tissue paper and tied with ribbon.
"It's not an either-or situation," explains Kramer. "It's the best of both worlds existing together. It makes me laugh when people act as if they know all the answers, and organisations are pro-online or pro-offline."
Sara Lundgren never wanted to work for herself. She knew she would drive herself too hard. Yet, here she is, aged 28, working 24/7, as they get used to saying in the online fashion world, spending most of her time in a cramped office with no windows in a converted warehouse on Wattle Street in Ultimo.
It's not even her own office. She and business partner (and fellow Scandinavian) Natalie Müller, who launched their directory site, shoppingbird.com.au, late last year, are perching inside the offices of friend and web developer/strategist Nigel Burke.
Lundgren, with degrees in marketing and international business administration, had met fellow student 27-year-old Müller in 2010 just as Müller was mulling over a business concept. She'd been to New York and fallen in love with the jewellery of Alexis Bittar but, back here, searching online, she couldn't find a local stockist. She wondered if there was room for an online directory for bricks-and-mortar fashion.
Lundgren, who had moved from Sweden to study at Wollongong as part of her degree, before falling in love with NSW's beaches, had recently exhausted herself plodding around Sydney trying to buy a dress for a wedding.
Was there room for an online directory that wouldn't just tell you where to buy something but would provide maps and lists to tell you what you could buy in certain areas?
In late November, Müller and Lundgren, armed with determination and good HTML skills, leapt into the online throng. It took them almost twice as long to go live as they had hoped and cost them much more than they'd reckoned and, to get the $50,000 seed funding, they'd each used their life savings.
"It was tough, very challenging - but a lot of fun," says Müller, a sweet, kitten-faced blonde with turquoise eyes, who now gets by on four hours' sleep and remembers that the last time she watched television was for Kate and Wills's wedding.
The site started with listings for 200 shops and within a month had 500. By early February, it was 616. "It's a graph that goes like this," Müller says, her finger pointing up in the air. Just as well, given it was her task, as sales director, to take the concept to store owners who were, at first, often sceptical.
The directory is a "shopping GPS"; it needs lots of store listings to work. The first to sign up was a wedding boutique, Akina Bridal Couture. The next, as Müller worked through the alphabet, was Alex Perry.
As well as store listings, there are tip-offs about sales, events and deals and the stores are charged $229 a year ("Or $19.99 a month!" says Müller). The site doesn't sell fashion online, nor does it list online-only stores. "That would defeat the purpose," says Lundgren. Instead, shoppingbird boosts bricks-and-mortar shops, and while bigger stores have signed on, it's a showcase for emerging designers, specialist boutiques and tucked-away shops that might not have the time, finances or tech know-how to get online attention.
"Some of these stores are like galleries," says Lundgren, "the owners are so passionate about their clothes. Our neighbourhoods wouldn't be the same without them."
More online fashion sites to try
Provides a platform for emerging designers of fashion, accessories, jewellery and lifestyle products to show off their wares. Home page displays a range of very wantable items.
Started six years ago by Buenos Aires import Victoria Moxey, it's a web, smartphone and print guide to the shopping villages of Sydney. Moxey has recently started operations in Perth, too.
Calls itself Australia's premier online fashion boutique - lists 40 designers plus its own brand, FS. Based in Brisbane and founded in 2006 by former fashion PR Marnie Goss.
This Sydney-based site, started in October 2009, is where customers from all over the world come to design their own shoes from platforms to stilettos to ankle-boots. Irresistible.
Some 23,217 people liked this site on Facebook when we last checked. Guarantees next-day delivery for buy-now, wear-now, affordable fashion; prides itself on providing total mix-and-match looks à la Clueless (see "The Economics of It All", page 45).
The economics of it all
Somewhere in the world, someone - who may or may not have seen the 1995 hit film Clueless - is intent on the painstaking, high-tech research that will one day lead to the holy grail of the online fashion world.
The virtual fitting room.
In the first scene of Clueless - a rejig of Jane Austen's Emma set in modern-day Beverly Hills - lead character Cher decides what to wear to high school that day.
Her state-of-the-art computer first lets her mix and match garments. "Mis-match!" it shrieks in big letters. Outfit finally approved by the computer, Cher hits the "Dress Me" button and on-screen the garment is popped onto a 3D model of herself for a final check.
Fashionista geeks are still trying to turn that idea into 21st-century reality.
"Whoever discovers that will become a billionaire, a zillionaire!" exclaims Marguerite Kramer, digital and content guru of mycatwalk.com.au. "People have been trying to do that since 1999. There was a Swedish fashion site, boo.com, that blew millions in a year ..."
Boo.com, which experimented with an avatar and 3D drawings of garments, is now seen as one of the great dotcom catastrophes. It was started by three Swedes based in Britain and lost $US135 million of venture capital in 18 months.
Twelve years later, reading about boo.com's bust is like scanning a cheat's guide for the online fashion entrepreneur: first, how to have a truly game-changing idea; second, how to still come a huge cropper.
The online frontier that so excited boo.com remains: women (and, increasingly, men) love to shop for clothes, and while online buying exploded in the United States five years ago, says Kramer, it has now taken off here. Estimates put the local growth rate at up to 13 per cent a year. That acceleration - and KPMG's chief economist Brendan Rynne has been quoted questioning whether sales figures fully capture how much is being spent online - has sent traditional retailers into a panic.
But the online traps that tripped boo.com are still there, too: underestimating the costs and time involved, failing to attract traffic to your site, and technology that's too clever. "A lot of apps are too complicated," says Kath Purkis, founder of leblackbook.com.au. "We were ordering a pizza the other night and it was just so hard."
As for loot, don't be misled by the billion-dollar figures in The Social Network or news stories about Britain's glamorous Net-a-Porter, the first high-end fashion site to put mouth-wateringly exclusive labels - Jimmy Choo, Diane von Furstenberg, Chloé, Louboutin - in shopping reach of anyone in the world with a computer screen and a credit card.
In April 2010, its founder, former fashion editor Natalie Massenet, sold her stake for a profit of £50 million ($73 million).
But it took Massenet 10 years to get there, and she told Britain's Daily Mail it was so tough she cried every day for a year.
Her success is the exception. One much-quoted Harvard study about entrepreneurs indicates that only 18 per cent of online start-ups by first timers will succeed. Australian online spending is still only about five per cent of our total retail spend and clothing accounts for only about five per cent of that. As well, figures from the Australian Communications and Media Authority, reported by The Sydney Morning Herald last November, reveal that Australians are preferring to take their online business overseas. Between 2009 and 2011, the figure for Australians reporting they mostly shopped on local online sites dropped 15 per cent.
It's about the pull of lower prices, a strong dollar and more choice. Three years ago, Massenet was already saying that Australia was her third-biggest customer base, and we're the second-biggest market for huge British online retailer ASOS (As Seen on Screen).
To stay competitive and viable, devoted local online fashionistas spend hours glued to screens, watching what other sites are doing.
Meanwhile, online customers are as merciless as the Queen of Hearts in Alice's Adventures in Wonderland. "You don't get many tries before you lose them," says Shawn Hickman, the investment banker who started discount site yclotheshorse.com.au, before moving on to fashion community blog Breakfast with Audrey. "My gut feel is that customers will try maybe two or three times."
A keen online shopper confides, "Actually, sometimes it's only once."
This story appears in the(sydney)magazine’s fashion issue, available with Thursday's Sydney Morning Herald.