JAPAN’S largest e-commerce company is betting that it has found the key to selling clothes online: a size-measuring bodysuit and its own line of clothing.
Start Today Co., which runs a shopping site in Japan called Zozotown that’s popular with younger consumers, unveiled its own made-to-fit private label T-shirts, jeans, and business suits as it pushes deeper into web-based apparel sales. The clothes are meant to be sold to customers using a body-scanning suit and app developed by the company, which is renaming itself Zozo Inc. from October.
Selling clothing online has been a big challenge for web retailers because sizes, colors, and looks are hard to gauge on the web. Sellers often offer free returns to spur purchases, but that also drives up costs and risks alienating customers. Start Today’s billionaire founder Yusaku Maezawa is betting that his strategy of offering made-to-fit apparel will help it expand overseas and quintuple its market capitalization in the next decade.
“Anyone in the world can relate to worries about clothing size,” Maezawa, 42, said in an interview. “When we looked overseas, we couldn’t find any companies that were offering lower-cost clothing that fit well. There was a need for that.”
Amazon.com Inc., which has been making an aggressive push into online apparel, last year bought Body Labs, a 3-D body-scanning start-up that lets people create a digital avatar of themselves to try on virtual clothes. In response to Start Today’s announcement of private brand men’s business suits and dress shirts — offered at a discounted ¥24,800 ($225) for a limited time — shares of Japanese suit sellers Aoyama Trading Co. and Aoki Holdings Inc. fell on Tuesday last week.
The key to a perfect fit with Start Today’s new clothing line hinges on the Zozosuit, a polka-dot studded bodysuit that lets users measure their proportions with a smartphone camera. Sales initially started with T-shirts and jeans, and the company added men’s business suits to its lineup. It also announced that the service and private brand would be available in 72 countries including the US by the end of July.
“If they can build a successful apparel-selling platform based on body measurements data, it can be huge,” said Akira Iwasaki, an analyst at Iwai Cosmo Securities Co. in Tokyo who has a buy rating on Start Today.
The growth plan is a big bet for a company that gets about 90% of its sales by providing a marketplace for clothing by other brands. Maezawa said Start Today is looking at potential acquisitions that could improve its measuring technology and production capabilities. While Rakuten Inc. is often seen as Japan’s home-grown e-commerce pioneer, Start Today is bigger, with a market capitalization that’s 25% higher at ¥1.3 trillion.
The company created a unit Start Today Research this year to acquire ideas and technologies related to fashion and clothing fit. It also made headlines in Japan in April when it offered annual salaries of as much as ¥100 million to find employees specializing in fields such as artificial intelligence, robotics and cryptography. — Bloomberg