Co-Founder & CEO of Etaily, Alexander Friedhoff Sets Up E-Commerce Success

If one was to look at co-founder & CEO of Etaily, Alexander Friedhoff’s curriculum vitae, you could say he was preparing to set up his own end-to-end omnichannel e-commerce service provider. But as he shared with LUXUO in the following interview, it takes more than just experience to ensure business success.

Could we start with sharing your background?

Etaily — as a proven builder, retailer and enabler of digital global brands — is the essence of my background.

My journey in the world of retail began at one of Germany’s most prestigious shirt-making companies, van Laack — a brand with a history of more than 150 remarkable years. During my tenure there, I had the opportunity to work in various roles, from manufacturing and product development in Vietnam as well as in business development and eCommerce implementation around the globe, from subsidiaries in Australia to the headquarter in Germany. This experience provided me with insights into the complexity of retail, manufacturing, and global brand strategy.

My professional adventure didn’t stop there. I had the unique opportunity to work at Zalora, the Asian e-commerce platform that reigns supreme in the fashion and lifestyle sector across Southeast Asia. I was building the Fulfillment by Zalora program. Zalora — an integral part of the Global Fashion Group founded by Rocket Internet — allowed me to dive deep into the ever-evolving landscape of e-commerce and global fashion in the Asian region.

My expertise extends beyond the corporate world; I also ventured into consulting, where I was associated with omni-channel strategies for diverse industries such as FMCG and fashion retail.

In addition to my professional pursuits, I am an active advocate for fostering robust German-Southeast Asian business relations. I proudly serve as a member of the German-Philippine Chamber of Commerce and Industry (AHK-PH) and contribute to the global economic landscape as a member of the World Economic Forum’s Global Shaper network.

What are the key experiences that you’ve gained from your career?

Throughout my career, I’ve had the privilege of gaining a diverse range of key experiences that have shaped my entrepreneurial journey — and have a big impact on the development of Etaily. Fundamentally it all started with ( r ) etail insight: My early years at one of Europe’s top shirt-making companies provided me with an in-depth understanding of the retail industry. I learned how retailers think, the intricacies of manufacturing, and the art of creating a compelling global brand. Aligned with this, I had the luck to build on this and develop an eCommerce expertise: my stint at Zalora — Asia’s leading e-commerce platform — was a great experience where I got to know remarkable mentors and good in-depth knowledge of the eCommerce market in Southeast Asia. Working along with great people in building the Fulfillment by Zalora program allowed me to navigate the fast-paced world of e-commerce and delve into the nuances of fashion and lifestyle retail. Also, my time in consulting impacted what I am doing today. My focus there was on omni-channel programs in diverse industries, such as FMCG and fashion retail.

Your company, Etaily, was set up in the Philippines in March 2020 — at the beginning of the COVID-19 pandemic. Was that just good timing?

Good timing is a good point. First of all, I arrived in Manila five days before the first lockdown. The Philippines had the hardest lockdown globally. So, for me personally it was exciting to quickly adapt to that new normal. Think about it: You are arriving in a new country with big hopes and ambitions and end up being locked in your apartment. I was short of putting my dreams on hold and returning to Germany — but I remained committed, because when you reflect on that new normal from an industry perspective, it was the best time ever to start. All brands, retailers and distributors needed to rush online, thus I stayed in Southeast Asia and continued building my own venture. The great foundation was laid out already before that “new normal”. I was lucky enough to build a great ecosystem when I worked at Zalora so my starting point was based on an existing infrastructure, which was then even more accelerated due to the COVID-19 pandemic.

How were you able to meet the demand so quickly with every brand rushing to go online?

Meeting the demand for brands seeking to establish an online presence quickly during the rush to e-commerce was indeed a challenging endeavour. The key to Etaily’s success in this fast-paced environment can be attributed to several strategic approaches:

1. The fundament was laid by proactive planning: We anticipated the shift towards e-commerce and knew that brands were looking for better, more efficient partners. By proactively planning and laying the groundwork for online transitions, we were able to respond swiftly when brands sought our assistance, in fact I was in contact with several of our today’s clients already before I started Etaily.
   
2. You can have the best plan, the best product — without a rockstar team, you are nothing. From day one, we have invested in having a team with an unbeatable experience. This was instrumental — in fact, our first team members are still with Etaily and already at a higher management level.
   
3. After a good plan, the right team — we continued relentlessly focusing on a robust Infrastructure: We invested in building a robust infrastructure that could seamlessly accommodate the influx of new brands. This included building our proprietary technology stack, warehousing facilities and logistics operations to handle increased demand efficiently.
   
4. What sets us apart is a scalable infrastructure: Our approach focused on providing scalable solutions tailored to each brand’s unique requirements. We understood that one size doesn’t fit all, so we adapted our strategies to ensure a customized and effective transition.
   
5. But, ultimately, we have invested a lot in strong partnerships: Etaily counts the leading Asian conglomerates and retailers to its partners — as investors, board members or clients. Collaborating with trusted partners facilitated a smoother set-up of Etaily.

By aligning these strategies and leveraging our expertise, we were able to meet the soaring demand for online brand presence swiftly and effectively. It was a dynamic and rewarding experience that reinforced the importance of agility, preparedness, and innovation in a rapidly evolving business landscape.

What do you exactly do for your enterprise customers ?

We build brands. We manage brands. We scale brands. Etaily is a digital-first, consumer brand and technology company which is powered by Clarity — our proprietary end-to-end e-commerce technology and operating ecosystem. In addition to powering our own brands, we provide a unique end-to-end direct-to-consumer e-commerce solution for global consumer brands, in addition to standalone digital services. This ecosystem spans the entire customer journey, from development of lifestyle products through inhouse branding capabilities, through to delivery to a local and regional customer base from Etaily’s asset light warehouse network.

Our vertically integrated services include:

• Retailing Etaily’s own brands, plus prestige 3rd party brands across 200+ Etaily built and operated storefronts on the leading marketplaces and own websites — all of which are powered by Clarity — with fully integrated trading, marketing modules, real-time business intelligence data feeds, payments, couriers, fulfillment and customer service, ensuring a frictionless and personalised e-tailying experience;
• New product development through the combination of data-driven range building and our highly experienced digital native frist brand builders.
• End-to-end digital brand building and content creation delivered by Etaily Studios

We build and manage that commerce platform with demand side scale effects from consumer data, deep local market knowledge, and distribution excellence in all platforms covering demand generation, conversion optimisation, demand forecasting and assortment planning, distribution, logistics, and ultimately tech.

To make a long story short: When you buy something online — from the leading digital first brands such as Crocs, Levi’s, Skechers, Fila and many others — you buy the products out of Etaily’s infrastructure.

What are the challenges building such a business in Southeast Asia?

Building such a business in Southeast Asia can be both rewarding and challenging due to the region’s unique characteristics and dynamics. Let me highlight in the beginning directly, Etaily would not be there without our strong investor base. We have the who is whom of the Philippine and Southeast Asian conglomerates part of our ecosystems. This makes many things easier.

First of all, we have to be aware that this is one of the most diverse markets globally: Southeast Asia is culturally and linguistically diverse, comprising multiple countries with distinct consumer preferences and behaviours. Adapting your business model to cater to these differences can be a significant challenge. Aligned with this, there are always regulatory complexities: Navigating the regulatory landscape in Southeast Asia can be complex, with each country having its own set of rules and regulations for businesses. There are also infrastructure variances: Infrastructure quality varies across the region. Some areas may have well-developed infrastructure, while others may lack reliable transportation, logistics, and communication networks, impacting our business operations. Another point is eCommerce competition: The e-commerce market in Southeast Asia is highly competitive, with both local and international players vying for market share. And ultimately, cultural sensitivity: Understanding and respecting local customs, cultures, and traditions is crucial. A lack of cultural sensitivity can lead to misunderstandings or mistrust among customers and partners. We at Etaily have built a solid and diverse culture, which helps a lot in cultural adaptation. But take note, despite these challenges, Southeast Asia offers immense opportunities due to its growing middle class, increasing internet penetration, and a burgeoning digital economy. Success in the region often requires a combination of local insights, adaptability, and a long-term perspective. Building strong relationships with local partners and stakeholders is key to success when it comes to navigate the unique challenges of doing business in Southeast Asia.

What’s your special way to address the market challenges in order to build up the business so quickly?

It is all about finding the right strategic partners. What sets Etaily apart is our unique approach from day one: our clients became also our investors. This distinctive approach has allowed us to proudly secure backing from some of the most influential conglomerates in Southeast Asia.

We’re honoured to have received support from a “Who’s Who” of Southeast Asian corporate giants, alongside esteemed investors specializing in specific sectors. Notably, SKS Capital, a private equity firm renowned for its expertise in the consumer sector with a strong emphasis on beauty, is among our valued backers.

• READ MORE: SKS Capital’s Jack Chen: “SKS sets itself apart with unique strengths that are difficult to duplicate”

Having a network of such distinguished experts join us on our growth journey — from our startup origins to our current scale-up phase — has been a game-changer. Their collective knowledge and resources have empowered us to accelerate our business like no other, setting us on a path to success in the dynamic world of eCommerce, retail and tech.

We understand that you will be speaking at an upcoming event in late October. What will you be sharing?

Etaily is headquartered in Manila, Philippines — one of the most dynamic cities in Southeast Asia. The Philippines is now expected to grow the fastest in 2023 among developing economies in East Asia and Pacific (EAP) — instead of Vietnam, according to the World Bank’s updated growth outlook for the region. Beside this epic growth, the Philippines is also the fastest growing eCommerce market globally. Imagine, we are faster than India, Indonesia or Vietnam. Given these developments, I will talk about how we are empowering brands in the context of the Philippines — it will be about unleashing the potential of eCommerce in the Philippines.

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