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30 Oct 2020

IUIGA Disrupting The Industry and Conquering The Home and Living Space

Excellent quality furniture that is made economically affordable. That’s the simple message that IUIGA wants to deliver to more people and it has done so with immense success. When we asked Jaslyn Chan, The Chief Growth Officer of IUIGA about the brand’s key focus, she said she wants to advocate the idea that quality is not always a luxury and you don’t have to pay more for it. 

This home and living brand is disrupting the industry with their bold and extraordinary business model. Within three days of launching their website, they had sold out more than 1,000 luggage and raked in half-a-million revenue within 100 days of their launch - dominating the home and living space in a short period of time. Some of their unique propositions include transparent pricing and selling non-labeled items. 

“Typically big furniture brands would mark up the price to 10 or 15 times by the time it reaches you. The product goes through at least 10 to 20 layers from manufacturers to the end consumer. With an increased price at every layer of distribution, that results in the price that you see in stores.”

Jaslyn shared that product labels are removed to convey a strong message to consumers that they are paying for the quality and not the brand. They also transparently share their mark-ups with consumers to justify the price they’re setting. 

 

IUI Cost of  furniture manufacturing

Image Source: IUIGA

Apart from its business model, people seem to always notice their unique name. Jaslyn explained that Uiga means quality in Samoan. This appealed to her as she wanted a unique word that reflects endurance, she further included an I in front that stands for ‘I love quality’ and that’s how they got the name. So now that you understand the business more, let’s get into how the groundbreaking business model came to life. 

Setting New Precedents for Home and Living 

According to Jaslyn, the idea came to them when they were shopping for furniture for their new office. In their search for furniture, they noticed that they often had to choose between premium brands that were overly pricey or mass-produced that are not satisfactory in terms of quality and design.

As consumers themselves, they were frustrated with the lack of affordable and good quality options. They wanted an alternative where they can have quality without burning through their fund, but they were met with disappointment.  So it became a competition among them to find a good manufacturer that can give them good quality furniture at a reasonable price and that where it began. 

“We found our first manufacturer after three days and we were introduced to the world of ODM (Original Design Manufacturer). That's how we found out that international brands have been buying products from these manufacturers and sell them at a high markup price.”

Shocked to find out that the markup can go as high as 10 to 15 times more than the cost of production, they started reading annual reports and realized there was a gap in the home and living space that they could fulfill and a potential market that is waiting for them to explore.

IUI Original Design Model

Image Source: IUIGA

They chose the home and living industry because it was a very big industry with very little parties involved in the middle. Apart from that, they relied on these manufacturers knowing they would have done their quality control process so that helped them eliminate the need to allocate time and efforts to do it themselves. 

“There’s a reason why IUIGA only works with international manufacturers, it’s because their experience of working with big brands proves their credibility in producing good quality products and the line-up of products they have to offer helps give IUIGA more product options to choose from.”

They started off by launching furnishings first as it was smaller and easier to sell, then launched other categories as well such as personal care, mother, and baby, travel, and furniture on a pre-order basis. 

With that, IUIGA became the first and only e-commerce brand in Southeast Asia and Singapore operating on a unique ODM business model.

Overcoming Challenges with Feedback

When sharing about their biggest challenge in handling the business, Jaslyn shared that as IUIGA is an inventory-heavy business, they needed to make sure the products sold fast enough in order to roll in their next inventory and to gather feedback from customers on whether they should continue with the product to ensure their inventory are not overwhelmed with products that don’t sell. 

Aside from that, back before they started selling their products, they tried all sorts of means to gather information, feedback, and encourage app downloads. 

“We had to make the products tangible before selling them despite having little to no budget, so I even resorted to giving out free ice cream for the sake of an app download. Every day I would pitch at the CBD’s hawker center to ask for opinions from the uncles and aunties that were in my target audience. “

She commented on the experience as being very helpful and informational. She further explained that the feedback from those people was what drove them to create their own website as it makes it easier for people to make their purchases through the website. 

“That’s when we started focusing on developing our own website because we launched the app first with the knowledge that mobile commerce was the next big thing back then.”

IUIGA Website



Image source: IUIGA

 

With that feedback, they launched their website and sold out their first 1,000 luggage within three days. When asked why they specifically sold out the luggage first, Jaslyn commented that it was because they had marketed their luggage as being from the same manufacturer as Samsonite - which was known for their durability but they had sold them at a relatively low price that it was an irresistible bargain for customers. 

With such success, Jaslyn shared that their key was to listen to what their customers want by conducting surveys that can help them improve their products and services from time to time and this focus still holds true as they have their own growth team that works their magic to deep dive into the survey and helps them become the brand that they are today.

Keeping Their Digital-Native Persona

As they were initially known as a digital-native brand, where they were first and foremost an online brand before going into retail, so going digital has always been a big part of their business. With a website and mobile e-commerce platforms where transactions are carried out online, they felt like it was only natural for them to accept cashless payments. 

IUIGA Website

Image Source: IUIGA

“It was the other way around for us, we contemplated whether to accept cash at all. This is because the majority of our transactions come from cashless at 86% and the accuracy that cashless payments bring about is incomparable to cash.”

Jaslyn further explained that when factoring in the risk of human errors and the time spent handling cash are additional liabilities that are not ideal for them as cashless payments give them accurate and quick insights on the performance of their business and help them market the brand. 

When asked about their collaboration with Fave, Jaslyn commented saying it has been a seamless journey. They find Fave’s Cashback as different from other loyalty programs. 

Before starting their collaboration with Fave, they already had their own loyalty program. However their loyalty points work in such a way that loyalty points earned by customers cannot be converted into credits or discounts and with Fave, they learned that it works better when the Cashback can be used as credits in their next purchase. That’s when they added that change and it has helped increase return customers since. 

“Fave approached us and from there we got to know that through Fave we can accept GrabPay which is ideal as our customers get to earn GrabRewards and Fave Cashback at the same time. It was a three-ways collaboration that is really beneficial.”

A customer spends an average of S$30 and S$40 at IUIGA. After launching Fave eCards, they have seen an uplift of average spending by 2 times more. At the same time, customers are enjoying the extra value given in eCards too. upfront payment has helped them manage inventory better and market the product in advance. 

What we have learnt from the IUIGA story is that in an effort to bridge the gap between quality and price, Jaslyn and the team put real hard work into making the customers the center of their growth. 

In order to deliver the goals to customers, this compact team handles every aspect of the supply chain – from sourcing for raw materials and liaising with manufacturers, to marketing the brand, managing social media platforms, and even the delivery of orders.

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