"A story of dried mangoes and split yokes"
A key investment theme for me around ecommerce is personalisation. I have a new post coming on this but a quick bit of background on the sector by way of anecdote. Two examples from recent personal experience:
Graze have a beautiful box and bodenesque (innocentesque ?) branding for middle class brits. They also have a very comprehensive online form to fill out so you spend 15 minutes telling them exactly what you do and don’t like so they can tailor it for you. However my first box arrived and I contained something I hate: Macadamia Nuts. I cancelled it. I am sure it was my fault. I am sure I missed a tick box somewhere. But the point is that if you raise expectations for a perfect product (which by definition a personalized product is), then too much choice can be negative.
TailorStore solves my problem of over-paying for tailored clothing. Which is a big problem for me. After a similarly convoluted online form-filling process (but this time involving a measuring tape, my wife, an old shirt and a mirror) I got a shirt ordered. However when the shirt came, the shirt did not fit. A bit of forensic investigation revealed an error in one of their pictures on how to measure for a shirt. This was their fault and after an awful customer service episode I have a credit note, but the point here is that there is a now a useless shirt on my shelf that has pissed me off and destroyed the margins of Tailorstore.
As an investor this is another area of caution for personalisation businesses: Returns can completely alter the profitability of a standard ecommerce operation but when you can’t sell the returns on…