Iconic British department store Harrods is turning to a digital luxury marketplace for help with ecommerce technology. Harrods announced on Tuesday that it plans to launch a revamped ecommerce site using an ecommerce application developed by high-end fashion marketplace Farfetch Ltd. next year.
Harrods, No. 388 in the Europe 500, is using Farfetch’s enterprise white-label offering, Farfetch Black & White Solutions, to create a global ecommerce site. Farfetch Black & White builds ecommerce applications for retailers and brands and will provide Harrods with ecommerce management and operations, international logistics and technical support. Harrods will continue to manage marketing, brand relationships and product strategy, all creative and editorial content and customer services for the ecommerce site and operations.
“Harrods has a global customer base, fantastic product offering and exceptional services such as its loyalty program,” says Kelly Kowal, managing director, Farfetch Black & White Solutions. “We will leverage all our experience in managing technical and logistical complexity for luxury brand partners to deliver everything required to achieve the best digital luxury experience for Harrods’ customers.”
Terms of the agreement were not disclosed, but it could pave the way for Farfetch to add more retailer clients, writes Bloomberg Intelligence analyst Deborah Aitken. The “endorsement of Farfetch’s global ecommerce model by Harrods, an elite and globally aspirational department store, will likely open doors for more elite retailers to follow suit and seek Farfetch’s e-expertise,” she writes.
In addition to providing ecommerce technology to brands and retailers, Farfetch operates its own online luxury marketplace. That marketplace, which is based in the United Kingdom, sells items from more than 1,000 boutiques in 48 countries to luxury buyers in 190 nations. Farfetch is No. 23 in the 2019 Internet Retailer Online Marketplaces database.
Farfetch has been growing rapidly, fueled by the $885 million it raised in its IPO on the New York Stock Exchange in September. The company also got a $397 million capital infusion in 2017 from Chinese ecommerce giant JD.com, No. 1 in the Internet Retailer Asia 500, which took a 14% stake in Farfetch, according to the prospectus Farfetch issued ahead of its IPO. Farfetch previously had raised $304.5 million, according to Crunchbase.
Farfetch’s platform services, which includes Black & White but also other revenue streams, such as fees charged to sellers for packaging, credit card processing and other transaction processing activities, posted strong growth in the third quarter, its most recent earnings. Its 2018 third-quarter total revenue grew 52%, with platform services revenue up 61% year over year to $106.290 million from $66.148 million a year earlier. Farfetch Black & White Solutions signed two new brands in the third quarter, Roberto Cavalli and Neil Barrett. Also in the quarter, Farfetch agreed to acquire CuriosityChina, a digital technology company offering a suite of services aimed at helping brands expand in China via web, app and WeChat. Farfetch will report its fourth quarter and 2018 full-year earnings Thursday.
Farfetch isn’t the only luxury ecommerce player selling online retail technology services. Italy-based luxury retailer Yoox Net-A-Porter Group SpA, No. 78 in the Top 1000, also designs and manages online stores for fashion and luxury brands including Armani, Alexander McQueen and Alexander Wang.
Bloomberg contributed to this story.Favorite