AI fills data gaps at luxury fashion seller Azura

The majority of Azura's business comes from selling well-known fashion brands in existing e-commerce marketplaces, and this model has been boosted since February by the rollout of its AI Transformer system, which has also enabled recent landmark deals with companies like Farfetch. Australia and Next UK.

“I think six months ago the total number of our databases was around 100 million people that we could sell to, but by launching in countries like Korea and the Nordics, we are reaching now 300 million subscribers,” says Wood, who co-founded the company in 20https://www.businessnewsaustralia.com/19 with Tim Bloore.

“As soon as we turned on the AI ​​model, it was almost instantaneous.”

From what he describes as a previous “Frankenstein” model of using various third parties to verify data on products intended to be sold or resold around the world, Wood notes that the funds were used for Azura can build its own infrastructure from scratch.

“We needed a barcode, some kind of technology that scans the images and gets the information about what they represent. Everything we sell is branded, so the information is somewhere online,” says Wood, who won the award. Sydney Young Entrepreneur Award – Fashion and design in 202https://www.businessnewsaustralia.com/1 and 2022.

“We built this AI Transformer that takes data from suppliers in all different formats, whether it's CSV or API, and it feeds it into our system and then uses artificial intelligence to extract the data images using Google's AI; the same technology behind Google's lens, but their corporate software.

“Once this process is done, it is then sent to Microsoft and goes through OpenAI. Using the data generated by Google, it then references it to several websites like GShttps://www.businessnewsaustralia.com/1, Barcodelookup.com as well as the official brand sites to find the model name and number.”

These two steps make the difference between being able to label a product as, say, a “Nike shoe” and knowing that it is a Nike Airmax 97 with the measurements, width and price.

“Then we use Amazon's AI tool to research why this product was listed in each country. We now have all the market research around this product. Then we add the shipping fees “shipping so we know where we're going and won't be competitive,” he says.

“All of a sudden we went from having almost zero data on a product to knowing that we can sell the product at a certain price point in every market, and then also having the taxonomy as well as the translations for in every country we sell in,” he says, pointing out that of the 30 countries Azura sells in, nine markets are not in English. A year ago, around 30 per cent of sales were made outside Australia, but today that share is around 60 per cent.

“Something that used to take us almost three or four months to get this now takes us about 24 hours.”

This has resulted in major efficiency gains for Azura, removing much of the most tedious human work from the process, moving to an automated system and freeing up time for the company's nine staff members. business can do more meaningful work.

“That was released in February this year and from February to May our fixed costs went from $165,000 to $70,000 because all of a sudden we didn't we no longer needed to call on all these external agencies that were pulling in pieces,” he says.

“There are very few touchpoints between when a product arrives in our system and when it is posted online and sold, which now allows us to also choose the best logistics routes.

He says the AI ​​Transformer has also helped provide more accurate knowledge of the weights and dimensions of different products, with implications for cost savings that add up over large volumes.

“When we go to print the label, we no longer guess,” explains the 35-year-old entrepreneur.

“Before we said 'Let's do everything in 2kg to be safe'. Now we might know it's actually 800g. The difference in cost between 2kg and 800g, say with DHL Express from Italy to Australia, is almost half. We have cut our logistics bill in half, we have cut our operations in half.

“Now we're reaching a position where the business is starting to be in the profitable phase, and everything before that, basically from June to July, is still growing.”

Following this recent growth, Azura is now raising the same amount as in late 2022 – $2 million – through crowdfunding platform OnMarket, which Wood says will help increase revenue and profitability, as well as to increase brand awareness.

“The last increase we made was to create our own internal database, which is now complete, so now it's all about scale,” he says.

“We are now looking to increase profitability and make this business extremely profitable, and https://www.businessnewsaustralia.com/10x our business valuation and are looking for an exit within the next two years.

“Before, we wanted strategic partners to grow the business. Now, with crowdfunding, it's about getting a fan base to help us grow the business and build the Azura name. So , when we go to the market, everyone knows who we are.

Currently, the brand is not widely recognized because it operates through other retailers: only 5% of sales come from its own online sales sites Azura Runway and Azura Reborn, the latter linked to circular fashion which still constitutes a significant part of Wood's business. ambitions.

“We are now taking care of the entire second life of Farfetch in Australia,” he explains.

“We have our own buyback system, Azura Reborn Buyback, where customers sell their bags back to us for cash, in exchange for credit on Azura.

“Because this system works so well, Farfetch has now moved to a white label service so that it can also offer all Farfetch products. »

He hopes to replicate this same setup in other markets and points out that the company is also starting to gain popularity and credibility within the global retail space.

“When we started this business we were doing business with your general stores in Australia like Catch and Kogan where they sell everything, and people don't really go there to buy Louis Vuitton bags,” he says.

“We've just partnered with Next in the UK and we've launched their entire luxury fashion arm, which is a huge thing for us.

“This is a company worth hundreds of billions of dollars dealing with an Australian startup, and I think it’s a huge win.”