STARTUP:

It’s not personal.

It’s business

Shopping philosophies and consumer demands have changed massively in the last couple of years where it’s become all about niches, the specifics, and the purpose. While customers today know what they want, they are also looking for assistance from the ‘experts’ to guide them in their shopping journeys.

That is perhaps why the personal stylist market has seen a surge in the last few years with the likes of Stitch Fix and MatchesFashion. com evolve to use data science to deliver personalisation and grow its audience. U.Sbased Stitch Fix, which has traded publicly since 2017, posted a $9.5 million profit in its fiscal first-quarter 2021 and is gaining customers every quarter.

In the UAE, Mr. Draper launched as a curated shopping service built to help men who hate shopping or don’t have the time, to look good by combining technology, data, and fashion. The home-grown startup has enhanced its popular online styling and ‘try-before you buy’ option by adding two new services – a tailoring solution and a basics online shop - that will further allow customers a personalized, seamless shopping experience.

Founder Mahmoud Gao shares insights on the personal stylist business.

Tell us more about the concept of Mr. Draper.

So the way the original concept started was to hire a freelance stylist to go with you to the mall and help you do the shopping. After some research, I realized that that model is not technically scalable and there's a lot of different freelance stylist platforms out there already. So once I saw similar concepts in the U.S. and Europe that were doing the box service of ‘the try before you buy’ concept with a personal stylist with an algorithm on the backend making a selection, I thought that was really the future and that's the direction that we should head in.

How does it work?

You start by creating a profile of yourself, giving us information about both your style preferences and your sizing preferences. That information is then fed into an algorithm that sends out a set of recommendations to your personal stylist. The stylist filters down those recommendations send them to you to try on for three days. You keep whatever you like and send back whatever you don't like. And the most critical part is here when you're sending back the items, you're giving us data on essentially what worked for you and what didn't and why it didn't work.

How much funding have you managed to secure so far?

About $2.5 million from friends and family and a super angel that's on board with us.

How exactly are you leveraging all the data you've collected over the years to benefit your business?

Data, for us, is basically gold. A lot of retailers dread returns, but for us, returns are as important, if not more than actual purchases. Because that’s where we learn from the customers and understand what they want or don’t want. It affects our decisions, both on a micro and macro level. On a micro level, it tells us if a colour or size doesn’t work for a customer or what price point they are going for. On a macro level, it affects our buying decisions. it's more about recognizing the trends and trying to forecast what we should be ordering next.

Do you have any particular loyalty schemes or does your business model itself serve as a loyalty platform?

Yeah, I think personalization leads to loyalty at this point in time. It's something that we want to implement at a higher level. Right now, if you're looking at typical, e-commerce what you see is the retention of maybe 30% on a year-toyear basis. We're up to 50%. That’s because the customer appreciates the fact that we're providing a very personal experience, which makes them come back. So they shop with us more frequently than a typical e-commerce business.

Is your business model purely B2C? Have you never thought of launching a B2B arm?

That's a great question. We are actually building a company in the B2B space using a lot of the technology that we've built for Mr. Draper, but the official announcement is pending.

But, would you consider partnering with some of the big traditional retailers in the market?

Absolutely. It's something that we are actually looking to do and we’d welcome them with open arms. We have a lot of ideas and we think we spend a lot of time thinking about what the future of shopping in the apparel space is going to look like. We look forward to sharing our technology with other players in the region and hopefully globally.

So what is the future of apparel and fashion retail going to look like, especially in the e-commerce space?

It is going to be a mix of online and offline where pure online players would have to offer some sort of, offline experiences because that gives them a better customer acquisition channel.

We've seen a few players already implementing better customer experiences like Nike having an app where you can try on shoes using implemented reality. So there are quite a few companies now starting out and tackling the sizing problems.

Do you have plans of expanding within the region?

One hundred percent. We want to be in Saudi by next year and we're gearing up to do that right now. The customer is young and digitally savvy. They're mobile-first and are Arabic and English speakers. And they're used to buying online. So they feel like there's a tremendous opportunity for us there.

Considering you are a pure-play online service, I’m surprised you haven’t had a presence in other countries so far. Why is that?

That’s a really good question. So one of the challenges with e-commerce in the region is the lack of unification in terms of processes and pricings and laws and regulations across the GCC. So what applies in the UAE is different in KSA. For us, in order to economically ship products from the UAE to KSA, we have to have a presence on the ground in KSA, because our boxes are quite big, so they're really expensive to get across the border. So that's been a challenge in scaling across the region. By next year we want to have a presence on the ground in KSA and operate directly from there.

What were the other challenges that have gotten easier over the years?

When you're first starting out, especially with a concept like ours, it's hard to get brands on board. As you start to build awareness and traction, it gets easier over time. Fundraising and finding the right tech talent were also some of the challenges we faced.

It's very easy to get personalization with data, but personal connection is still something that online retailers are struggling with and you seem to have found a balance. Is that right?

The biggest company in the space of Stitch Fix. It's a $3 billion company that's based out of the U.S. And even they say that machines can only do so much. You have to have the human element as part of the experience. And that's what sets this type of business model apart. ■