Reinventing Ecommerce: Idealz Bets On Incentives
You’ve undoubtedly heard that it’s a good thing to think outside the box. Last year forced companies to invest heavily in eCommerce, and the smartest realised innovation must continue if they want to drive online business growth further. With the rapid acceleration of online shopping and the ability, it’s affording companies to adapt quickly to […]
Topics
You’ve undoubtedly heard that it’s a good thing to think outside the box. Last year forced companies to invest heavily in eCommerce, and the smartest realised innovation must continue if they want to drive online business growth further. With the rapid acceleration of online shopping and the ability, it’s affording companies to adapt quickly to the needs of a generation of consumers, Jad Toubayly, co-founder of Idealz, a Dubai-based eCommerce platform, has ensured its buzz carries through to 2021.
He considered different solutions for reaching his desired outcome in online shopping, where a customer can buy a hoodie and walk away with a brand new Mercedes G-wagon. The young entrepreneur put together a business model that not only incentivises the customer and achieves his business goals but also has a significant social impact.
Idealz’s global reach has topped 120 countries since going live in 2018, while it has worked with Dubai Cares to provide quality education to those less fortunate around the world. Here Toubayly talks about the challenges of running an eCommerce business and why it is important to innovate online shopping experiences.
What was the inspiration behind Idealz?
I wanted to reinvent the online shopping model. A deep look at various online stores and eCommerce websites revealed that very little was done to innovate or change the online shopping experience and enhance the incentive program.
From its inception until today, buying something online typically followed very similar and very outdated protocols, including (1) scrolling through items, (2) adding them to a cart, (3) paying, and (4) getting them delivered.
The majority of retailers’ focus was and still is focused on doing just these four steps better. Idealz wanted to take a whole new approach to incentivise customers to buy from us without compromising the four existing steps without hindering bottom lines. I also wanted to have an impactful CSR program at our core. With that, Idealz was born.
What was your biggest challenge, and how did you overcome it?
Given Idealz has a prize draw element in its business model and being a new brand, I knew that customer trust would be the biggest obstacle to overcome. There were several things we did to build consumer confidence in our brand, including a high level of transparency on all aspects of the business model, complete regulatory conformation and adherence with permit numbers of each campaign made public, alignment and association with top tier brands and entities that further evoked trust, and building a world-class platform using best-in-class service vendors to provide a seamless customer experience.
What is the key thing that makes Idealz special? What prompted you to break the traditional online shopping formula?
Our incentive formula! Nowhere else can you buy a cap or a hoodie and walk away with a brand new Mercedes G-wagon or a fully furnished apartment. The traditional formula has been overused and has barely changed since the start of shopping online. I think the majority of the big brands are still dealing with digitalising and shifting online before even starting to assess the effectiveness and attractiveness of the traditional online shopping formula.
Tell us about Idealz’s growth and performance.
Idealz has been live since January 2018 and has since generated over 1 million app downloads with customers from more than 120 countries. To date, we have successfully closed more than 1,800 campaigns and have winners from 35 nationalities. The value of prizes awarded has now exceeded Dh50 million. While these are excellent for a start-up, especially based in Dubai, our ambitions and goals are for much more than this.
Also Read: Is Contextual Changing Content Monetisation Models?
What is Middle East eCommerce like? How would you describe a typical Middle east online customer? What do they love – and hate?
It would be wrong to assume that an online shopper has the same traits wherever they are coming from. The Middle East online customer is still very different from a Western online shopper. This is not only due to the slower rate of digitalisation that is happening here versus the more developed markets, but it is also due to factors like smartphone penetration, credit card penetration, availability and affordability of data packages, availability of efficient logistics, and overall technology affluency.
The Middle Eastern online customer still prefers cash on delivery. This is more due to back ending the risk and ensuring the item is delivered rather than a more convenient form of payment. In reality, digital payment is always more convenient than physical cash payment.
Also Read: How Netflix Knows What You Want To Watch Next
Cross-border expansion is typically the most difficult part of running an eCommerce business. What problems did you have, and how did you solve them?
Idealz currently does very well in operating from Dubai to the world. While it does have some hurdles and setbacks, it is currently performing above my expectations regarding the number of offshore active customers we have. These offshore customers and their respective locations have given us good insights on where to focus our expansion efforts.
To effectively operate in another geography, we must physically set up in that geography and form the type of collaboration similar to what we do in Dubai. We are now in the process of expanding to other geographies via various formats, including franchising, for which we have a fully developed franchise program.
Also Read: Is Social Commerce The Future of Shopping?
What are the most common mistakes eCommerce businesses make?
I think there needs to be a separation between eCommerce businesses and start-up eCommerce businesses. Start-up eCommerce businesses make a very common mistake of entering the market with very little innovation than the natural titans of the market. If I am to compete with Amazon or a Noon, I must offer something they don’t. Whether it’s the experience or the price, or the proposition, something needs to be different for me to attract an audience.
The other mistake start-up eCommerce businesses make is that they tend to over-staff and over-focus on elements that have become less relevant. This creates substantial cash-burn and hinders unit economics.
Tell us about your Martech stack.
Idealz uses a host of technologies to optimise the marketing process, and we continue to try and test new ones on an ongoing basis. I can confidently say that the shelf life of a marketing tool is very short and what worked very well for us three years ago is no longer as effective today. Having said this, new technologies are coming to market a lot faster and are innovating at a very rapid rate.
