Avocado Grows Retail-Delivery Business on West Coast and Hawaii
Bringing the Grubhub model of delivery service to the apparel retail industry, Avocado announced it is entering into partnerships with local stores in select cities to provide a shopping, pickup and delivery service that connects consumers with clothing.
Launched in January by Sri Kakani and Prady Gupta, the Santa Clara, Calif.–based company will provide service to the Bay Area, Los Angeles and Hawaii and will eventually serve major cities nationwide.
“Customers want to buy stuff online, especially new-age millennials. Interestingly enough, the best people to deliver those services are local stores, yet the biggest problem is that local stores aren’t made to do it,” Kakani said.
Not only is Kakani seeking to ease the burden of warehouse-based online shopping, but he also wants to improve the customer experience of e-commerce.
“There are a lot of shipments happening, and it’s not the best shopping experience possible,” he said. “There is no proxy for trying on clothing. There are technologies that try to do that, but it’s not the same. It doesn’t have the same feel. It doesn’t have the same look.”
The Avocado platform allows consumers to search stores in their local area for clothing they want at that moment and receive the order within two hours without leaving their homes.
“What we provide is a platform for local apparel stores to [interact with] their customers within their local area,” he said. “So, the platform is discovery, delivery and the customer experience combined.” This entire process will take only a few hours, according to Kakani.
To use the Avocado application, consumers will pay $50 per year for a membership. A range of plans will be offered through different packages, but the pricing for these plans has not yet been released. If a customer decides that he or she doesn’t want the order, Avocado absorbs the costs of the service according to the return policies of each retailer.
“Sixty-seven percent of people use e-commerce in a certain way in any given year,” he said. “If stores get on this platform, they will never lose their customers. They will get new customers who will not even go to Amazon anymore.”
The pricing structure for the cost of retail partnerships will be based on sales conducted through Avocado. While these have yet to be determined, Kakani believes the cost to partners will be 10 percent to 30 percent of sales.