e-Commerce industry has had lot of mixed messages for the region over the last few years. Many players entered the market while a few took the exit door. Today we start a three part interview series with some upcoming and established e-Commerce players in the region.
The first one is Namshi.com which sells clothes, shoes, dresses online and has shown strong growth in its first year of operation. The site grew from three to 100 employees since it began in October 2011. We interviewed Hosam Arab who is one of the co-founders and Managing Director at Namshi. Prior to joining Namshi, Hosam worked in Private Equity with Waha Capital in Abu Dhabi focusing on managing Waha’s portfolio of assets in addition to sourcing new investments for the firm across multiple industries. Hosam has a Bachelor’s degree in Electrical Engineering from Queen’s University in Canada and an MBA from Harvard Business School in Boston.
What motivated you to start Namshi?
A year ago, we saw a clear opportunity in the fashion e-commerce space for this region. Our offline retail market is very developed, and quite fashion forward, however, this was not mirrored online and that did not make sense to us. We partnered with one of the largest and most successful players in the fashion e-commerce space, Rocket Internet, and the past year has been an amazing ride – we’ve never looked back.
Most outstanding factor of Namshi that distinguishes you from the competition?
Namshi is the only online retailer in the region that works directly with the brands we sell. We have direct and very strong relationships with our suppliers from Nike and Puma, to Lacoste, Polo Ralph Lauren and Vero Moda. This has been a huge advantage for us as we always have access to the latest collections, and can ensure we have sufficient availability for our customers.
As well, Namshi stocks everything we sell in our own warehouse, allowing us to ensure speedy delivery to our customers. Our customers deserve great service and we can offer it to them by ensuring that they get their products within a few days from ordering them.
How important is mobile commerce for you?
We see substantial traffic coming from mobile and tablets and it is definitely something we are excited about. One of our key focus areas currently is to continue to optimize our site for that traffic.
What’s the average margin you expect to get as an e-Commerce retailer?
E-commerce retailers can compete on price or can compete on value. We choose the second route. Our offering is of great value to our customers in terms of convenience, and importantly, we do not charge a premium over offline retailers for that.
How have factors such as SEO, user experience, site design, those less visible but very important aspects of having web presence, been contributors to your success in addition to more publicly visible things such as stories and social media?
In a market as under developed as ours, I think these things have been more important to us than the more visible aspects you mention. It is essential to design a site that is easy for a novice customer to reach, to navigate and to purchase with ease. This is probably one of our biggest competitive advantages as we have a super team focused primarily on doing just that.
Any plans to start a retail store?
Offline presence is not of interest to us at this time. The growth and the potential is online and that is where we see ourselves for the foreseeable future. It is also what we do best.
Biggest challenge in the region for your e-commerce start up?
Our biggest challenge has been our most interesting one as well – that is learning from our customers and adapting our offering to suit the needs of a user that is still adapting to and getting comfortable with shopping online. Our learnings have been immense and we will continue to enjoy this ride with our regional customer for years to come.
What do you think will happen to the e-Commerce industry in 5 years in the region?
We only see it growing. If e-commerce in this region is going to grow to similar proportions as those in more developed markets, and there’s no reason why it shouldn’t, then it’s safe to say that we’ve barley scratched the surface here.
Your biggest competitor?
To be honest, we do not spend much time considering competition at this time. It’s too early in the life of e-commerce to be looking at this. What e-commerce players in this region should be focusing on right now is improving the experience for the online customer and really developing this market. There is enough room for everyone to benefit, especially if we all see this (developing the market) as our common goal.