Evocha
Luxury British fashion essentials sold online at disruptive prices. Curated range and lean design.
- Location
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London,
United Kingdom
Categories: Clothing & Accessories Mixed Digital/Non-Digital B2C
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Investment
sought: - £30,000
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Equity
offered: - 10.00%
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Investment
amount: - £30,000
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Valuation
(pre-money): - £270,000
Idea
Introduction
Evocha will be an online-only fashion brand selling a limited, curated range of luxury fashion essentials manufactured using the highest quality materials in the best factories. Our designs will be simple and classic, with a focus on iterative product development.
Evocha will aim to sell products at significantly lower prices than existing products of the same quality. The company plans to take advantage of the shifting trends of consumer behaviour towards e-commerce, and the decline of brands made obsolete by the economy of vertical integration.
Emerging US-based brands have experienced great success by cutting out the middlemen and selling high quality products online-only. This is a timely business opportunity in a rapidly growing market that has yet to be exploited in Europe.
Evocha plans to quickly begin taking advantage of demand for luxury British fashion goods in China by selling products through Tmall with an emphasis on quality and low cost.
Intended impact
Evocha plans to remove the price barriers that prevent customers buying the highest quality products. Customers that previously had to settle for products that are poorly designed and constructed can now purchase cashmere, wool crepe and silk products made in the best factories around the world. This is a huge opportunity that has not yet been exploited outside of the US, and only to a small extent so far within the US.
Evocha aims to become an emerging market leader in the UK and Europe by challenging traditional views towards the manufacturing and sale of luxury fashion goods, and encouraging companies to think innovatively and ultimately benefit the customer.
Evocha will aim to inform the customer of the true value of premium goods, and encourage a preference for quality and longevity over quantity and disposability.
Evocha will be a lean fashion brand, and will differ from traditional brands in this respect. Instead of producing a new range of products each season, the existing products will be incrementally revised, developed and improved so that over time the company becomes known for a small range of incredible products. Customers will become familiar with the offering, and will recognise Evocha products for their consistent design and quality.
Evocha will follow the approach adopted by technology companies such as Apple that focus on incremental innovation, and occasional range expansion, instead of range renewal. This approach will reduce design and sampling costs, and enable the company to focus on customer feedback and the strengths of a few products.
Evocha aims to liberate style-conscious customers who appreciate simplicity, durability and quality yet are not able to afford the products of premium designer brands.
Substantial accomplishments to date
Evocha has achieved the following accomplishments to date:
- Incorporated in the UK
- Secured domain name
- Produced company logo and branding
- Worked with students in UK universities to produce initial product designs
- Purchased rights to dress design for launch range
- Produced samples of launch range products including wool crepe dresses, cashmere scarves and Oxford shirts
- Established relationship with UK and European manufacturers for launch range and further product categories
- Run detailed profit and loss analysis to establish pricing and initial forecasting.
We are almost in a position to place initial orders and plan the store launch upon receipt of investment.
Monetisation strategy
Evocha will make money by eliminating superfluous costs in the traditional fashion supply chain, without compromising on the quality of products produced. The simplified fashion supply chain is as follows:
Design
Sampling
Internal review
Approved products offered to fashion buyers
Manufacturing
Products sold by third party distributors
Evocha will reduce design costs with the approach of iterative design. Products will be designed without consideration for current fleeting trends, instead we will employ a simple, classic design approach to ensure longevity and reduce the requirement for refreshing the range with each season. The internal review will occur prior to sampling to avoid wasting money sampling designs that go unused, and the review will be ongoing throughout the product’s lifecycle. Any design revisions will be incremental and in the best interest of the consumer, and products will remain on sale generating revenue until the next iterations are released. In our experience, it is not uncommon for the total markup on a fashion product to be around 300%, split between the brand and distributor.
Evocha plans to sell products exclusively online using the Shopify platform, and will not use any third party distributors. Shopify charges £38 per month and a 1% transaction fee on all sales, but negates the requirement for developing proprietary e-commerce technology. The company plans to maintain a gross margin of 40% on all products sold. Low minimum order quantities have been agreed with manufacturing partners, to reduce potential overstocks and allow the company to react more quickly to customer feedback. The brand will only require a small team to operate, and the supply chain will be in a constant state of review. The US-based company Export Now allows Western brands to sell products through Tmall, charging an annual service fee of $5,000 and taking 20% margin for each product sold and fulfilled. Evocha plans to work with Export Now to establish a presence in the Chinese market.
Use of proceeds
Evocha intends to use the investment raised through Seedrs to fund the initial production run of the launch range of products, and to cover initial marketing costs.
Initially, the company will engage with early-adopters and influencers within the London fashion and technology community to gain feedback and develop the brand. Once a product-market fit has been achieved, the company will invest in marketing and PR to accelerate growth.
Approximately £10,000 will be used to purchase initial stock.
The launch range will include the following products:
- Dresses manufactured in London by the manufacturer of the Roland Mouret Galaxy dress
- Oxford shirts constructed from Albini fabric and manufactured in the last remaining shirt manufacturer in the UK
- 100% cashmere scarves produced by a world renowned Scottish mill.
£5,000 will be committed to working with early-adopters to develop the business, and the remaining amount will be held as working capital.
The company has taken a £9,950 loan from the Startup Loans Scheme, in the name of the lead entrepreneur. Whilst the proceeds of this funding round will not be used to repay the outstanding balance of this loan, interest payments of £49.88 for the first 12 months (and thereafter £233.75 for an additional 48 months) are repayable.
Market
Target market
The target demographic for Evocha is the male or female professional between the ages of 21 and 35 who shop predominantly at upper end high street fashion stores such as Banana Republic, Zara and Top Shop. Evocha will target consumers within this demographic who acknowledge the disparity between the quality of product they want and the quality of product that is available within their budget.
Evocha's products will often be priced significantly higher than the products sold by H&M for example, which will limit the lower end of the high street market. However, customers that are willing to pay extra for higher quality products but not as much as the amount charged by premium brands will be the ideal target for Evocha.
Evocha plans to initially focus upon the UK as a target market while developing the brand and iterating upon product design. Once a product-market fit has been achieved, the company will begin to deliver globally, with a specific focus on the Chinese market.
Characteristics of target market
The UK fashion industry is worth around £21 billion. A once female dominated market is now opening up to both genders, as men have more disposable income due to decreased property purchasing and an increased interest in fashion. Consumers between the ages of 21 to 35 have more disposable income and fewer financial commitments than those outside of this bracket, and are key targets for the fashion industry.
Around $40,000 is spent online every second by the 200 million Chinese e-commerce users, totalling around $102 billion this year. These figures are set to rapidly increase over the next few years, making the Chinese market a highly lucrative one. Apparel sales make up the biggest single category of products purchased online, accounting for 36% of all sales. Major European luxury fashion brands are beginning to take advantage of this developing market. Evocha intends to establish a presence in China early on to capitalise upon this demand.
Marketing strategy
Evocha plans to be an online only brand, with no physical presence. This decreases overheads but also impacts upon discoverability.
We plan to begin with a soft launch in 2013, working with fashion bloggers and fashion/tech early-adopters and influencers to develop the brand. Extensive use of social media and SEO will help to improve search engine ranks and build a customer base, in order to prepare the online store for a full launch. Once the product-market fit has been achieved, the company will be able to make us of this influential network to promote the products to the target market.
At this point, the company intends to employ the services of a fashion PR firm to spread awareness of the launch. Ads will be placed on Google, Facebook and Twitter to increase awareness and promote the brand.
It is imperative that from the start, potential customers see Evocha as a trustworthy brand with real feedback from independent third parties. Consumers are becoming increasingly cynical towards brand marketing, and rely more and more upon social proof and credibility. The company will work to ensure the high quality of the products and customer service, and will rely on customers and advocates of the brand to acknowledge the quality of the offering and spread this to others.
Word of mouth will secure the longevity of the brand, and this will be achieved by a combination of social validation from early-adopters and proliferation of the brand message through social networks and PR.
The company intends to simultaneously promote products on Baidu, a key Chinese search engine, and Sina Weibo, a Chinese microblogging service. A Mandarin-speaking employee will be taken on to interact with this market and translate site content. Evocha plans to list products on Tmall to reach the Chinese market, and take advantage of their local fulfillment capabilities.
Competition strategy
Few competitors currently exist, and those who do operate almost exclusively within the US. However, it is only a matter of time before brands are launched in the UK and Europe to cater for shifting consumer trends and the economies of vertically integrated e-commerce.
As long as the company maintains the highest levels of quality and continues to release well-designed products that address the needs of the target market, competitors will have little impact upon the business. If the company made the decision to compete on price, this would mean a compromise on the quality of the products, and this is the key selling point of Evocha products. If the company is able to build brand loyalty and gain recognition of the quality and integrity of its products, it will be able to compete.
By establishing a presence and supply chain into the Chinese market early on, Evocha will seek to gain an unfair competitive advantage over similar fashion startups. In our experience, many designers starting up fashion brands have little business knowledge and focus more upon design. Evocha will invest less time in design and more in exploiting the Chinese market to take advantage of demand for British luxury fashion products.