DTC’s Daily Digest brings you the latest news on the world’s fastest growing direct-to-consumer brands. In today’s edition: Flipkart Founder Invests in Ola; Secret Escapes Is Purchasing Pigsback.com; and Asics Thrives with DTC.
Flipkart Founder Invests in Ola
The investment is part of an ongoing Series J round of financing that is likely to exceed USD$1bn (£771.1m) and would value Ola, which competes fiercely with Uber in India, at around USD$6bn (£4.6bn). Bansal’s commitment comes a month after existing investor Steadview Capital put USD$75m (£57.8m) towards the round.
Ola is locked in a dogfight with Uber, which has made India its highest priority market outside of the U.S. Uber started slowly in India, but it is pushing hard in the country having opened a dedicated local R&D centre and hired a country management team that operates outside of the rest of its Asia Pacific business.
To battle its U.S. rival, Ola has expanded nationwide to cover more than 100 cities and towns. It has also expanded beyond just cars, developing its own mobile money service, investing in other startups, and pushing other strategies to appeal to local customers.
Secret Escapes Is Purchasing Pigsback.com
The deal is expected to be announced on tomorrow (21 February), with Secret Escapes acquiring Empathy Marketing Limited, one of Ireland’s leading providers of premium hospitality deals.
It will be the latest in a string of takeovers by Secret Escapes as it progresses towards an eventual stock market flotation or sale in the next couple of years. With the power that Airbnb already holds in the market, it is no surprise to see Secret Escapes have an aggressive acquisition strategy, as it looks to solidify its market share.
Operating in more than 20 countries across Europe, Asia, and the U.S., the company has 62 million members globally, with 22 million in the UK alone, it says. With acquisitions like this, Secret Escapes is well on its way to becoming a British ‘unicorn’ (achieving a valuation of at least USD$1bn/£773m).
Asics Thrives with DTC
Despite a drop in net sales, Asics has managed to post strong full-year results in EMEA, boosted by a good showing in direct-to-consumer channels.
The sportswear brand and retailer saw a 3% decline in its EMEA net sales during 2018, but direct-to-consumer channels saw an increase of 22%, with e-commerce sales increasing 105% compared to the previous year.
It looks like DTC will be a big area of focus going forward as well, with the brand looking to open more stores throughout EMEA, invest in own-branded environments, and hiring Scott Wakefield to oversee planning, buying, and direct-to-consumer.
With traditional brands seemingly under threat from DTCs, the athletic apparel market has reacted extraordinarily well to the trend. Aside from Asics, Nike and Adidas have also invested heavily in their direct-to-consumer channels, utilising their clout to open more own-branded stores, and sell more through their own channels. With Asics following suit here, athletic apparel brands that don’t embrace DTC could find themselves left behind.