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Inverted Edge

Written by Yao Dianchen & Lau Geok Theng

In April 2013, Debra Langley, the Chief Executive Officer of Inverted

Edge, was evaluating how Inverted Edge could enter the China market in
a strategic manner and achieve greater consumer acceptance in this huge
Inverted Edge was founded in September 2012 with the mission to take
talented Asia-Pacific independent designers global and to provide
exclusive styles and an engaging shopping experience to independent and
style-concerned women around the world. Inverted Edge identified the
problem that young talented Asia-Pacific designers did not have the time,
people or resources to sell internationally. At the same time, there were a
growing number of independent female customers who were looking for
uniquely designed styles which could be easily mixed with high-street or
luxury fashion, but provided different looks and represent who they were.
However, most of these customers could not find simple access to the
styles they wanted.1 The company Inverted Edge was thus born to bridge
the gap, with its website officially launched in English in April 2013. The
company set US, Australia, Hong Kong and Singapore as its initial major
target markets, although they shipped worldwide.
The Company
The company Inverted Edge Private Limited was founded in September
2012 in Singapore. It secured funding of US$1.6 million before its launch
from the Singapore National Research Foundation (NRF), Incuvest (a
government appointed venture capitalist under its Technology Incubation
Scheme), Accel-X and four other undisclosed private investors.2 After a
development and preparation period of around 6 months, Inverted Edges
website finally debuted in April 2013. The launch was reported by
Techcrunch, VentureBeat, Yahoo, HerWorld Singapore, Cosmopolitan
Hong Kong, and several other major websites and presses from US, UK
and Australia.
Management & Structure
Inverted Edge was founded by Debra Langley, Chris Kelly, Geraldine
Laborie and Karen Yeo. Each of the founders served the key roles in the


company as Chief Executive Officer, Chief Operating Officer, Chief Buyer,

and Chief Product Officer, respectively. Under the management team,
there was a merchandising team, an editorial & visual merchandising
team and a warehouse team. Besides the internal teams, website
development and rich media marketing were supported by partner
companies, Nokomai and Redbean Republic.
The co-founders were responsible for developing the corporate strategies,
overseeing the daily operations of the company and evaluating the
performance of the business as a whole.
The merchandising team, led by chief buyer Geraldine Laborie, was
responsible for the product purchase, display, and pricing. They attended
fashion shows and exhibitions, utilized their own networks, and
negotiated with designers on styles to purchase, price points, and
consignment share formula. They were also responsible for product
management on the website.
The editorial & video merchandising team was responsible for product
photography and editorial drafting. They also worked closely with the
marketing team to convey the right company image through social
network platforms, the press and the media.
The warehouse team was responsible for the receipt of products from
designers, management of warehouse inventory and product shipments to
Nokomai served as the website development team for Inverted Edge.
They were responsible for the front end user interface (UI) development,
backend system development, and graphic design according to Inverted
Edges requirements.
Red Bean Republic was responsible for the brand management and
marketing strategies of Inverted Edge. They had been executing
marketing campaigns, including uploading of videos in social media, to
build a healthy brand image and connect with its target customers.3
Product & Delivery
As a unique e-commerce fashion company, Inverted Edge aimed to create
an online platform for customers to discover unique fashion and shop for
the best from Asia-Pacific designers. On the one hand, Inverted Edge
aimed to build an international stage for the young and talented ready-towear (RTW) designers based in the Asia-Pacific region to showcase their
talents and reach their target customers around the world. On the other
hand, Inverted Edge sought to build a platform for independent thinking



and style-concerned customers to shop for the edgy but wearable designs
in an interactive way, through communication with designers, friends and
the community.
Inverted Edge emphasized product quality and services in addition to
styles and designs. The apparel and accessories must be made with fine
fabrics and metals under manufacturing process with strict quality control.
When products were purchased by customers, the warehouse team would
check the items before packing them with special tissue and anti-dust
bags. Inverted Edge partnered with DHL, one of the worlds most reliable
and best performing global logistics companies, to guarantee the delivery
of the ordered items within 5 working days. An easy return service was
also available to customers.
In April 2013, Inverted Edge officially launched its website with its first
collection of 2013 Spring & Summer female ready-to-wear series (see
current website of Inverted Edge at This
collection, which consisted of over 350 styles of apparel, 150 styles of
bags, shoes and accessories, and three styles of limited edition items,
were from 36 independent designers in 10 Asia-Pacific countries (see
Table 1). Of the 36 designer brands, three provided capsule designs which
were exclusively designed for Inverted Edge. These three limited edition
designs were on a pre-order basis and customers were required to place
the orders first before the limited number of pieces (usually fewer than
ten) of each style would be produced and delivered to them.
The retail prices of the products ranged from US$80 to US$500. The
website was accessible in all parts of the world. Customers could make
the purchase in 3 simple steps: order the items they like, pay through
credit card or Paypal, and confirm the address for the items to be
delivered to their doors worldwide.
About 50% of Inverted Edges products were purchased from the
designers on a wholesale basis, and the other 50% were on consignment
basis. For the consignment items, the designers agreed to ship their
goods to Inverted Edges warehouse without being paid. Inverted Edge
would keep these items for a period of time and only pay these designers
when their items were sold. The unsold products would be shipped back
to the designers at the end of the agreed consignment period.
Target Market and Direct Competitors
Inverted Edge was adopting a niche market strategy. It targeted the
group of female consumers between 23 and 45 years old, who were well
educated, thoughtful and independent fashion shoppers. They cared
about their daily personal style and consistently looked for unique styles
which conveyed who they were and helped to differentiate them from the

crowd. They were willing to spend US$500 and above on independent

designer apparel annually. They were global citizens, often professionals
who travelled often. They might be in London one day and in Hong Kong
the next day. Thus, trends and seasons would not be their main concern
when shopping for clothes. They were likely to be fashion opinion leaders
within their group of friends because they were able to make the lesser
known brands they picked look high street or luxurious with minimal
effort. They had comparably high spending power and were young from
inside out, and they dared to try something special.
Table 1: Inverted Edges Spring Summer 2013


Number of






Designers Names
Mary Ching
DayDream Nation, Injury, Twisted Sister
Rachanna Reddy
Hunting Field, Major Minor, Harper &
Smith, Nina Nikicio
Twoin, ETW Vonneguet, Paratiisi
Acbine, McNelly, Nineteen Eighty,
Ryukei, Pomme Dllie, Socoop,
Fleamadonna, Post December, Demoo
Andrea Moore, Karen Walker, Stolen
Lion Earl, AWOL, Edge of Ember, Carrie
K, Eugene Lin
Jayson Brunsdon, Talulah, Michael Lo
Sordo, Lee Mathew, Empire Rose, Gail

However, Inverted Edge was not the only company who targeted this
group of female fashion shoppers. There were several other companies
who had spotted this problem ahead of Inverted Edge, and they had
scaled up their businesses in recent years. These major competitors
Local Competitors:
Shop the Mag, Asia Fashion Inc, Zao Zao, Eriin, Gnossem
These were online designer boutiques located in Singapore. Similar to
Inverted Edge, they also focused on serving the niche market of female

independent fashion consumers with worlds emerging fashion designers

work. Most of the designers they partnered with were also from AsiaPacific region, although their designers seldom overlap with the partner
designers of Inverted Edge.
International Competitors
Internationally, there were not many notable online boutiques which
focused specifically on Asia-Pacific independent designer brands.
However, there were some well-known websites where they sold specially
designed independent female ready-to-wear designer brands of the
emerging designers of the world.
Shopbop was a USA-based company. It was one of the biggest online
shopping sites where female consumers shopped for designer labels. They
offered a good mixture of the well-known designer brands like Alexander
Wang, Michael Kors, Vera Wang and Lanvin, together with other lesser
known brands from young emerging designers. They provided a wide
range of the choices of over 2000 styles at any one time, and the prices
of these items ranged from US$12 for a pair of earrings to over US$2,000
for a lovely dinner dress. The website was in several languages including
English, Chinese, Japanese, French and German.
Muuse was based in Copenhagen. They cooperated with the best 100
world emerging designers to produce well-designed styles to worldwide
consumers in a very small quantity. They worked with the elite tailors to
make the designs into garments or accessories, and sold to customers
around the word. Its concept had been known around the world ecommerce fashion industry. The designs were usually sold on site, batch
by batch, and each batch carried fewer than 50 styles. The garments and
accessories on this site ranged from US$100 to US$800.
To compete effectively, Inverted Edge chose to focus on the niche market
and use differentiation strategy to achieve success.
Focus on the Niche Market
The online ready-to-wear apparels and accessories market was huge.
Several big players had achieved large market share with their
established reputation, rich choice of items, and relatively lower prices. As
a start-up company, it was hard for Inverted Edge to get enough

resources to compete with them directly. Inverted Edge, thus, decided to

go niche and serve the needs of a small market where customers looked
for unique, specially designed, exceptional but wearable styles with good
quality and reasonable price. It was not easy to find items with these
attributes in high street fashion brands or famous luxury designer brands.
Thus, the relatively young and emerging talented designer brands become
their first choice. Inverted Edge was partnering with these designers to
serve this niche market.
Market Positioning
Besides going niche, Inverted Edge was at the same time differentiating
itself from its competitors who were targeting the same niche market. The
market positioning of Inverted Edge and its competitors are shown in
Figure 1.
Figure 1: Market Positioning of Inverted Edge

(Source: Red Bean Republic)

Discovery Experience
Inverted Edge aimed to provide shoppers with a fun, unexpected and
discovery shopping experience. This experience was attained through the
process of exploring and examining the exceptional styles, communicating
with the designers, purchasing and using the products, and sharing their

experiences with friends and other customers. The last step of customers
writing their feedback on the website provided a reference for the other
customers who might be interested in the same styles.
Curated Styles
Compared to the other local e-commerce multi-label retailors who focused
on Asia-Pacific independent designers, Inverted Edge emphasized a
curated collection of styles for customers. With its analytical process using
technology and data, Inverted Edge ensured that the styles on its website
were loved by its customers.
Marketing Activities
Video Marketing Campaign
From 5th March 2013, the company started its video marketing campaign
on Youtube, Vimeo and Youku. The series of videos, which mainly
featured different designers Inverted Edge partnered with in Spring &
Summer 2013. The videos were in English, except for two on Korean
designers that were in Korean. All of them had English subtitles. They
were uploaded to the three video platforms and Inverted Edge website
batch-by-batch, and they were also twitted on social platforms to give
potential consumers around the world an idea of who Inverted Edge was
and what they were doing.4
Social Media Marketing
The social media used by Inverted Edge included Facebook, Twitter,
Tumbler, Pinterest, Fancybox and Sina Weibo. A Facebook advertising
marketing campaign was carried out.
Influential Press and Bloggers
Inverted Edge invited influential fashion editors and bloggers from its
target market to feature the styles and post recommendations on their
blogs. By 20 April 2013, Inverted Edge had been featured on two
magazines (Cosmopolitan Hong Kong and Her World Singapore) and
bloggers pages in the US, Italy, South Korea and Hong Kong.



China and the Chinese Market

China: Country, History, Politics and Economy
The country China, officially named the Peoples Republic of China (PRC),
was located in East Asia, bordered by 14 countries, including North Korea,
Russia, Kazahkhstan, Pakistan, Vietnam, Laos and several others. It was
the third largest country by land area with 9.6 million square kilometers.
It was the most populous country in the world, with a population of 1.3
billion in 2012. The country declared the ownership of 23 provinces
(including Taiwan), 5 autonomous regions, 4 direct-controlled cities
(Beijing, Shanghai, Chongqing and Tianjing) and two self-governing
administrative regions (Hong Kong and Macau) (see Figure 2).
Figure 2: Map of China

The early dynamics of China could be traced back to its ancient dynasties
starting from Xia Dynasty around 2000 BC, followed by Shang, Zhou, Qin,
Han, Sui, Tang, Song, Yuan, Ming, and Qing dynasties. In AD 1911, Dr
Sun Yat Sen led a revolution to overthrow the Qing Dynasty under the
three principles of nationalism, democracy and peoples livelihood and
gave birth to the Republic of China. After Dr Sun's death in 1925, one of
his protgs, Chiang Kai-shek, seized control of the Kuomintang or

Nationalist Party and succeeded in bringing most of south and central

China under its rule in a military campaign.
The Communist Party of China (CPC) had its origins in the May Fourth
Movement of 1919, where radical political systems like anarchism and
communism gained traction among Chinese intellectuals. In 1927, Chiang
turned on the CPC relentlessly from their bases in southern and eastern
China. In 1934, driven from their mountain bases, the CPC forces
embarked on the Long March across China's most desolate terrain to the
northwest, where they established a guerrilla base at Yan'an in Shaanxi
Province. During the Long March, the communists reorganized under a
new leader, Mao Zedong. The bitter struggle between the KMT and the
CPC continued through the 14-year long Japanese occupation. Following
the defeat of Japan in 1945, the war between the KMT and the CPC
resumed. By 1949, the CPC had established control over most of the
country. Chiang retreated to Taiwan with his government and his most
disciplined troops
In 1 October 1949, Chairman Mao Zedong proclaimed the Peoples
Republic of China (PRC). Under his support and encouragement, the
population grew from 550 million to 900 million during the period he took
leadership. He started the Great Leap Forward revolution which aims to
rescale the economic system and lead the people to live a better life. This
revolution, however, resulted in 45 million peoples death from starvation.
In 1972, at the peak of the Sino-Soviet conflict, Mao and Zhou Enlai met
Richard Nixon in Beijing to establish relations with the United States. In
the same year, the PRC was admitted into the United Nations in place of
the Republic of China (Taiwan) for China's membership of the United
Nations, and permanent membership of the Security Council.
A power struggle followed Mao's death in 1976. Deng Xiaoping
outmanoeuvred Mao's anointed successor chairman Hua Guofeng, and
gradually emerged as the de facto leader over the next few years. Deng
Xiaoping was the Paramount Leader of China from 1978 to 1992,
although he never became the head of the party or state, and his
influence within the Party led the country to significant economic reforms.
Dengs succeeding leaders Jiang Zemin and Hu Jingtao further maintained
the growth trend of the Chinese economy.
In 2000, China formally joined the World Trade Organization. China was
now the worlds largest export country and the second largest import
country. China was the second largest economy in the world in terms of
nominal GDP of US $8.227 trillion in 2013 (see Figure 3). China
experienced GDP growth of over 10% from 1980 to 2010 but from 2011
onwards, Chinas GDP growth had slowed to below 10%. Despite its huge
GDP, the GDP per capita still ranked 92nd worldwide in 2012.


Figure 3: Chinas GDP

Luxury Goods Market in China

According to World Luxury Association, the Chinese spent a total of
US$8.6 billion in 2008, which represented around 25% of the luxury
goods sales around the world. In 2010, China surpassed USA and became
the world second largest luxury market. Following the current trend,
China was forecasted to take over Japan as the largest luxury market in
the world by 2014.
The growth rate of the luxury goods market in China, however, was
slowing. According to Jing Daily, the growth rate in 2013 was forecasted
at 7%, down from 30% in 2012. The high growth luxury sectors were
timepiece and spirits, which were mostly used as gifts for bribery
purpose. The Business of Fashion pointed out that the main cause of the
slowdown in growth was the recent anti-corruption drive in China.
Meanwhile, Chinese luxury consumers were becoming sophisticated. They
were diverse and dynamic, with vast differences in need, spending power
and life philosophy. Jing Daily identified two groups of high spending
luxury goods consumers: Urban Middle-Class Aspirants and New Nobility.
The Urban Middle-Class Aspirants referred to a group of young working
adults who were confident and positive about their future. They spent not
only according to their current income but their possible future earnings.
Comparing to their counterparts in Western countries, they tended to
save less and spend more on luxury products, which they saw as an
indication of their wealth and status. This group was becoming more
sophisticated and their spending had moved beyond bling luxury bags to
products which expressed their individuality and enriched their fashion
knowledge. They were educating themselves with immersion in luxury
atmosphere. The New Nobility, one the other hand, consisted of business,
industrial and Party elite. They used luxury product in a subtle manner
rather than showing off the brand names and logos. They chose higher
level luxury goods which demonstrated their good tastes. They were
profoundly nationalistic and were increasingly attracted to domestic
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luxury brands.
Designer (Ready-to-Wear) Apparel Market in China
The designer apparel market in China was estimated by Euromonitor
International to have a size of US$5.05 billion in 2012 representing a
growth of 20% over the previous year. Due to economic downturn, the
growth of designer apparel market in China was slowing down. However,
several leading players like Armani and Prada were still opening new
stores in second tier cities in China. Table 2 shows the growth rate of
designer apparel. Within all the categories, the fastest growing categories
were womens designer clothing and mens designer clothing with growth
rates of 21.7% and 21.2%, respectively.
Table 2: Growth Rates of Designer Apparel Market in China

Table 3 shows the size by value of the designer apparel market in China.
Womens designer clothing constituted 44% of the total designer apparel
market with a total value of US$13.6 billion, while mens designer clothing
took up 35% of the total apparel market.
Beside the designer specialist stores, luxury department stores like Lane
Crawford were highly welcomed by Chinese consumers due to their efforts
in bringing in design brands with high brand awareness but low presence
and penetration in China. Alexander McQueen was one such brand. Apart
from the curated styles, Lane Crawford also provided their consumers
with personal services and pleasant shopping atmosphere, which
attracted loyal customers to the store. Brick and mortar stores were still
the major channel for designer apparel sales. However, internet retailing
for such products was growing. Online designer brands stores like and provided cheaper luxury designer apparel,
targeting at the luxury entry level customers who were young and price
sensitive and these sites were successful.

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Table 3: Market Size of Designer Apparel Market in China

High Street Fashion Brands in China

High Street fashion originally referred to the fashion shops which could be
easily seen on the high street in United Kingdom. Today, high street
fashion had evolved into a termwhich referred to averagely affordable
but trendy fashion. It was a relatively new concept for the China market.
However, it was quickly accepted and loved by the young generations and
was growing fiercely in the country in recent years, for they were more
affordable fashion of the current trend and were made with fabrics of fair
quality. They were largely present in the shopping malls of tier 1 cities,
and recently, tier 2 and tier 3 cities as well. Though some of them had
Internet retail services available for Chinese customers, the brick and
mortar stores were still the major selling channel in China. Fast fashion
retailors and high street brands including Zara, H&M, C&A and GAP were
expanding their territory fast in China in the recent 5 years (see Figure
4). After conquering the tier 1 cities, their newly opened store were
mainly located in tier 2 and tier 3 cities. According to Li & Fung Research
Center, in 2011, 80% of stores opened by Zara and H&M were in tier 2
and tier 3 cities.
Figure 4: Stores of High Street Brands in China

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China E-Commerce Fashion Market

China apparel market was huge and sophisticated. According to Li & Fung
Research Center, the total retail sales of clothing, shoes, hats and textile
reached US$129.7 billion in 2011, representing an increase of 24.2% over
2010. 33% of all apparels sold took place in department stores. The
online retailing market was worth RMB405.9 billion or US$66.1 billion in
2012 with a growth rate of 84% (see Table 4). The online apparel market
was worth US$17.6 billion in 2012 with a growth rate of 128% over the
previous year and constituted 24% of the total online retail market. The
internet retail apparel market was forecasted to have a compound annual
growth rate of 36.8% over the next 5 years and would reach a total value
of US$84.1 billion in 2017.
Table 4: Internet Retail Market in China

Inverted Edges Target Market in China

In the China market, Inverted Edge would target its usual group of female
consumers aged from early 20s to late 40s, which constituted about 24%
of the population of China (see population pyramid of China in Figure 5).
They were well educated, thoughtful, and cared about daily wear and
personal style. They might be educated and/or had worked abroad. They
could speak and read English and might travel frequently. They might like
to shop online and might not mind purchasing from a foreign online shop.

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Inverted Edges Competitors in the China Market

Dong Liang Studio
Dong Liang stands for talent in Chinese. Dong Liang Studio opened their
first boutique in 2009 in Beijing with the purpose of promoting the
homegrown cutting-edge Chinese apparel designers, showcasing their
talent and selling their designs. They partnered with around 20 labels to
provide edgy apparels and accessories for customers ranging from Tshirts costing US$30 each to a structured dress of over US$300. All the
brands they worked with were from homegrown designers in China. As
one of the earliest designer boutiques to open in mainland China, Dong
Liang soon gained its fame through word of mouth among its customers
and coverage on several newspapers and magazines. Their second Beijing
store and first Shanghai store were opened in 2011. They claimed that
they did not have plans to initiate e-commerce operations in the near
Triple-Major described itself as a concept store aimed to reinvent fashion
standards. It was founded in 2011 by its 24-year-old founder Ritchie
Chan, and already had two outlets, one called Yao in Beijing and another
called Mo in Shanghai. Beside these, Triple-Major also had its online store
(in English) to sell internationally and a Taobao store (in Chinese) for
Mainland China consumers to purchase online. They partnered with 20
designers internationally, from Tokyo to Milan, to bring the fun and
unique styles to their customers.
In 2011, Triple-Major also started its own design label under the same
name, which showed regularly in Paris fashion week. Triple-Major 2013
Spring Summer season had around 600 styles available in its online store,
including apparels, accessories, shoes and bags. The price varied from
US$17 (socks) to US$900 (knitted wool coat). They had built a stable
customer base within the two years of operation. Meanwhile, its unique
business concept and fashion angle had been reported by many Chinese
newspapers and magazines.
Shopbop China
Shopbop recently launched its Chinese website, which enabled Chinese
online shoppers who did not feel comfortable to shop in an English
environment to shop for luxury goods or designer brands on their Chinese
website conveniently. Shopbop provided a good combination of the new
emerging designer brands and some well-known brands like Alexander
Wang, Vera Wang and Lavin. The price range was from US$10 to over
US$2000. The website was in several languages including English,
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Chinese, Japanese, French and German. They targeted the thoughtful

ladies of 20 to 45 years old and the styles they curated were mainly chic
and contemporary. Shopbop offered free international shipping with
purchase of over US$100 and free return policy.
Figure 5: Population Pyramid in China


Neiman Marcus China

Neiman Marcus also recently launched its Chinese website. Neiman
Marcus was an American luxury specialty department store. It had been
established for over a hundred year, with 42 physical stores in the US by
March 2012. In 2013, Neiman Marcus partnered with a reputable China ecommerce fashion player Glamour-sales to enter the China market with
the Neiman Marcus China website and its specially curated styles for the

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Other Chinese Local Designer Brands

The China homegrown designer labels had become popular recently, ever
since the new First Lady of China, Ms Peng Liyuan appeared in clothes
designed by Exception, a local designer brand, when she accompanied her
husband during his visit to Russia. Exception became famous overnight.
In fact, even before the First Lady effect, the local Chinese designers had
already been notable and accepted by the population. There were a
number of Chinese designers who were educated in top international
design colleges such as Central Saint Martins and had returned to China
to debut their own brands. They were young and talented and their works
were thoughtful collections of fine material. Their customers included
some elites, celebrities and new nobilities who were nationalistic, lowkey, independent, and had good taste, and they were willing to support
the development of local fashion and new talented designers.
The Future
With all the information she found through research, Debra wondered how
Inverted Edge could reach the target market in China, compete with local
and international competitors, and gain penetration and market share in
this large market. There was the need to develop strategic and
operational plans for this market. One critical aspect of the strategy was
to find a partner who could handle the translation, customer service,
payments and logistics in the China market. Table 5 shows the visits to
Inverted Edges website by Chinese consumers. How can Inverted Edge
improve the number of visitors from China to its website and translate
these visits into sales?
Table 5: Inverted Edge Page Visits (Top 10 Visitor Cities)

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