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- Former Snap chief strategy officer Imran Khan has launched his new e-commerce company, Verishop.
- He’s pitching his company as an alternative to Amazon and other online retailers by ensuring trusted products, a better user experience, and solution to brands’ online retail logistical challenges.
- Verishop is finding white space where Amazon isn’t as strong and could compete with the global behemoth in some areas, experts say.
- The platform will not monetize itself through advertising, which could be a missed opportunity, though.
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Former Snap chief strategy officer Imran Khan has launched his new e-commerce company Verishop, a little over six months since he raised $17.5 million for the startup in November. The company is rolling out its website and iOS app Tuesday, with about 150 brands, including AllSaints, Diane von Furstenberg’s DVF, and Levi’s.
Khan is pitching Verishop as an alternative to Amazon, specifically in the categories of fashion, beauty, and wellness, by offering a fast, convenient way to get hand-picked products that’s better for shoppers and brands alike.
"Retail is a $5.5 trillion industry, and we’re only in the first or second innings of e-commerce," Khan told Business Insider. "Uber is not the only player in ride-sharing, just like Google is not the only player in advertising. There is a big opportunity for players other than Amazon as we transition from brick-and-mortar to online sales."
Verishop is trying to compete with Amazon through user experience
VerishopKhan said other marketplaces are rife with counterfeit goods and unverified third-party sellers, hurting brands and consumers. Verishop is taking control of the process by buying products wholesale from vetted brands, warehousing them, and reselling them.
Verishop will use a mix of tech and human power to help people discover products. It’ll be aided by an editorial team and seven influencers including Tiffany Ma and Megan Pormer who will pick products for what it calls "Tastemaker shops."
Verishop is also promising free, 2-day shipping regardless of the size or quantity of the order. In contrast, Target announced that it would start offering one-day shipping for $9.99, and Walmart offers two-day free shipping on qualified items, according to those retailers’ sites. But Amazon just announced it would cut its two-day free shipping to one day for Amazon Prime members.
Khan acknowledged that Amazon has a leg-up on logistics, but said he believes Verishop will still have an edge over other retailers, as a lot of brands find it too expensive to deliver this kind of convenience.
Its pitch to brands revolves around integrity and quality
Khan’s pitch is to help established brands reach millennial shoppers and direct-to-consumer startups expand their reach, and he said this focus on millennials and integrity has helped it attract well-known brands such as Diane von Furstenberg’s DVF.
Notably, Verishop will not monetize itself through advertising, and brands don’t have to pay for better placements, as they do on Amazon. Khan said Verishop will share analytics and macro-trends with brands but won’t sell consumer data.
"With advertising, you end up violating consumer trust, because whoever pays the most money is the one that ends up at the top," he said. "Never say never, but we don’t plan to run ads."
Apparel brand BLDWN, which sells its product in its own stores and more than 75 retailers, saw Verishop as a way to broaden its audience, said Diego Dominguez, men’s global sales director at the company.
"My biggest draw was that they’re helping tell our story, and it’s not getting lost with hundreds of other brands, as it tends to happen on other mass retailers," he said. "It’s like a digital department store focused on cool, niche brands from specialty boutique stores, and the visuals and styling are exactly how they would be on our own website."
Another seller, Paige Adams-Geller, founder of denim brand Paige, said she was drawn to the platform because of Khan and his leadership. Khan was Snap’s chief strategy officer, and helped steer it through its IPO in 2017. Its executive team includes former Amazon exec Cate Khan as chief strategy officer and Dollar Shave Club’s Jason Bosco as vp of technology.
‘Verishop is finding white space where Amazon isn’t as strong’
There’s no getting around the fact that Amazon is an online retail behemoth. Nearly half (46.7%) of all product searches start on Amazon, according to eMarketer, and its breadth of assortments and efficiency is unparalleled.
Verishop’s emphasis on trust and the shopping experience can help it stand out, though, said experts. Amazon’s breadth can be overwhelming for consumers, brands find it hard to get discovered, and counterfeit goods and unverified third-party sellers persist.
"Amazon has a number of problems, especially for brands," said Forrester analyst Sucharita Kodalily. "It is a rogue marketplace in spite of its best efforts, and that is not compatible with protected brands."
Verishop was playing it smart by "finding white space where Amazon is not as strong," said Jason Goldberg, chief commerce strategy officer at Publicis.
Still, Amazon is a global giant playing in many different lanes, said Will Margaritis, svp of Sellwin Consulting at Dentsu.
"If you’re looking to take on Amazon, you need to consider it a many-headed hydra — try to beat it at retail, and you still need to contend with AWS, and the rapidly-growing advertising revenue," he said. "The money is flowing into Amazon so quickly, from so many disparate parts, that I can’t see anyone getting ahead of them overall."
Advertising could also be a huge missed opportunity for Verishop, he said.
"An e-retailer thinking from the ground-up about what makes e-retail unique, between the data and the consumer journey, could build something very attractive to brands," he said. "But Verishop does not seem to be laying down the groundwork for a secondary revenue stream."
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