Australian startup, Akagu, will officially launch its online fashion marketplace on February 28.
The online fashion destination has attracted more than 2,500 subscribers during its soft launch and hosts over 30 retailers covering independent fashion labels.
Akagu’s new sales platform has also attracted interest beyond the fashion industry, with the startup exploring opportunities to diversify the format into alternative industries.
“Ultimately we believe Akagu provides users with a deeper shopping experience where customers are empowered by choice and brands have the opportunity to connect with customers that truly value their products or services,” said Akagu founder Jimmy Zhong.
“We envisage the Akagu model working well across various other industries, which is why we see Akagu as a lifestyle platform beyond just fashion.”
Akagu’s solution for clothing retailers is Australia’s first Dutch auction marketplace that focuses purchase behavior on perceived brand.
“There’s an increasing demand for smaller-run, independent labels producing higher quality clothing,” said Zhong.
But, he said, the price point just isn’t attractive enough to consumers most of the time. “That’s the beauty of Akagu’s reverse auction process – users are given access to high quality pieces at prices they are willing to pay.”
“Our initial sales consistently show an average of 10 per cent on sales margins was recovered by designers, with our highest reaching 46 per cent, so, while the purchaser was driving the price, a valued deal was achieved for all,” Zhong said.
Unlike online auctions already familiar to Australian shoppers, the Dutch auction format starts at recommended retail price, with the prices dropping periodically rather than the other way around.
Purchasers can bid to secure an item early in the sale or take their chances and wait for a price drop while taking the risk that another shopper may secure the item.
Melbourne property developer Capital Alliance has invested $400,000 in the startup.
Mohan Du, Capital Alliance founder and director, said he saw potential for the mobile-designed platform to grow beyond the fashion industry, meeting consumers on-the-go purchase behaviour across numerous industry categories and becoming a one-stop shop for Australians.
Akagu is looking to move into the travel industry with the aim of applying the unique reverse auction to hotel accommodation by end 2017.
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