The Benelux plays a key role in the expansion plans of Swedish fashion platform NA-KD. The three-year-old scale-up has a strong focus on influencer marketing and is already supplying in 125 countries.
Generations Y & Z
NA-KD is a young online platform that sells both external brands and private labels. The company develops fashionable and affordable clothing, accessories and shoes for generations Y & Z and owes its success mainly to influencer marketing: collaborations with names such as Anna Nooshin, Queen of Jetlags, Camille Botten, Céline & Talisa and others.
Three years after its launch in January 2016, the webshop already reached a turnover of 78 million euros. With a growth rate of more than 90% per year and strongly improved operational results, the company says that the break-even point is within reach. In the first half of 2019, turnover grew by 93% and own labels accounted for 86% of turnover. Operating cash flow (EBITDA) increased from -24% to -11% over the same period. Recently, the scale-up raised 20 million euros from existing investors Partech, eEquity and Northzone, and from new investors Quadrille (France) and La Maison (Luxembourg). In addition to core markets Sweden and Germany, the company sees considerable growth potential in the Benelux.
Where does this strong growth come from? Mainly due to the good ‘localization’ of the website, using automated translation processes and offering local payment providers and shipping options. NA-KD is already fully localized for Germany, Sweden, Denmark, Norway, the Netherlands, Belgium, Austria, Switzerland, France, Poland, the UK and the US.
In addition to core markets Sweden and Germany, the company sees considerable growth potential in the Benelux. NA-KD has already opened a physical store in Amstelveen and an outlet store in Roermond. In Belgium, a pop-up in Knokke (Albertplein) has just opened and the label is also available from ZEB and Brantano, among others. RetailDetail spoke with expansion director Björn Bergström.
“Born in the age of social media”
Who is NA-KD? Who is the company behind the brand?
“NA-KD is a Swedish company launched in early 2016. The premise behind the brand was to challenge the incumbent offline retail giants by working as a vertical direct-to-consumer brand, thereby cutting out middlemen and being able to have direct contact with our customers. The company employs about 200 people across departments as design, tech, marketing, expansion, operations and purchasing. NA-KD is a young company with an average age just under 30 and a majority female staff. We are growing quickly and onboarding new talented colleagues every week from all over the world.”
NA-KD sells well-known fashion labels as well as private labels?
“In the first year we had a majority of external fashion brands on site to quickly be able to ramp up sales, but today our own NA-KD brands represent more than 90% of our sales.”
How is NA-KD differentiating itself from other fashion platforms?
“NA-KD is a playful, modern brand with a relentless focus on delivering new trends and inspiration in an accessible way. We take pride in offering a stellar customer service that goes above and beyond to help our customers as well as constantly introducing new features, categories and collections on site to stay ahead of the curve.”
NA-KD collaborates closely with influencers – how, and why?
“NA-KD is a brand born in the age of social media and platforms such as Instagram and Youtube have been an integral part of our rapid growth since day one. Today we have more than three million followers in social media and partnering with influencers is an important part of our branding. Through influencers we can showcase new collections in a format that our customers find engaging and reach new audiences when we target new markets or segments.”
NA-KD uses Instagram for social shopping. Does it work?
“Social shopping is one part of our sales mix and we have seen good feedback from customers who like being able to quickly identify and purchase an item that they see on the fly.”
What’s the importance of having ‘localized’ webshops?
“Localized sites are important primarily for our customers, making sure they get the best possible experience. Thus they increase the trust of the brand. Most customers are used to shopping in their own language and with local payment providers and shipping options. Apart from an improved customer experience it also strengthens the organic traffic in the markets where we have a localized site.”
There’s been a lot of discussion lately on free shipping and free returns in e-commerce – Is it sustainable?
“We believe in making the customer experience as smooth and easy as possible, which definitely includes a world-class shipping experience. That being said, we are continuously evaluating our policies and ways of working.”
I understand NA-KD has opened physical stores as well?
“We believe in showcasing our brand where it makes the most sense for our customers - regardless of whether that is online or offline. That means we have an offline strategy with a big focus on pop-up stores as well as stand-alone stores and shop-in-shops. As we continue to grow fast as a company our experience-driven offline business will grow as well to better cater to both existing and new customers.”
What are NA-KD’s ambitions in the Benelux?
“NA-KD is still a very new brand in Benelux, but we have seen a tremendous interest from both customers, influencers and partners. We see Benelux as a key region for NA-KD and will continue to invest in our presence here to scale up the brand. We want to quickly establish NA-KD as the go-to brand for inspiration and affordable fashion for generation Y and Z.”
• #site visits, first six months, 2019: 55+ Million
• #social media followers: 2,9 Million
• Market penetration, two largest markets:
Germany: 4% of all women aged 21-23 shopped at NA-KD during Q1-2019
Sweden: 21% of women aged 19-21 shopped at NA-KD during Q1-2019
• International footprint: shipped to 125 countries in the last 12 months