Purple Dot, the London-based startup that helps businesses better manage their stock and customers through waitlists has some aggressive plans for 2021.
New partnerships in UK, US and EU
While the UK fintech has successfully completed its first major partnership with SPOKE London, the online men’s trouser retailer – following their success they’ve just launched in the US, with them now starting to appear on the websites of US retailers allowing the customer to join pre-order, in-season or out-of-stock waitlists.
In an exclusive interview with the company’s co-founders, UKTN has learnt, the Klarna rival is also prepping to announce new partnerships with two major brands, with the first to go-live on April 1 and another with a major shoe brand in the summer. No more details were revealed, except for one of them is a European brand.
Started in August 2019 by senior Skyscanner employees Madeline Parra (CEO) and John Talbott (CTO), Purple Dot was inspired, in part, by Parra’s grandmother, who would try on clothes then, after finding something she liked, ask the shop assistant to let her know if it went on sale. Retailers using Purple Dot can take orders to fulfil if they sell at lower prices, so they can better manage stock and reduce waste.
For their partnership with SPOKE, Purple Dot managed their first pre-order waitlist, allowing SPOKE’s customer to pre-order a new style eight weeks before production. Aiming to sell 25% of their planned stock within 24 hours of the pre-order launch, Purple Dot’s system, creating hype around the sale, sold 97% of the stock in the first 24 hours.
Purple Dot’s solution helps remove the guesswork from stock management. Parra explains, “Many retailers try to predict how many products they will sell, get it to the warehouse and launch on their website. But getting the prediction right – almost never happens, then there are delays in production or warehousing, and you end up with unsold inventory problems.”
Purple Dot solves a problem created by online retail solutions that are designed around a physical product being available for sale, creating issues when they were not. While most retailers solve this by inviting people to join a mailing list, Purple Dot creates a layer that makes it easier for the consumer. Instead of relying on people entering their email address and returning to buy, Purple Dot will take the relevant shipping and payment information, completing the sale when the product is back in stock.
Following the pre-order system’s success, SPOKE has rolled out the Purple Dot to their entire product range. Their website no longer shows items as out of stock but will instead seamlessly takes a customer who wants an out-of-stock product to a Purple Dot waitlist.
A small ‘bright’ team
Despite this expansion, the team remains small, just eight people. “I like keeping the team as lean as possible,” Parra says, “it’s what we set out to do, and it’s worked really well for us. You can just move faster and make sure everyone is fully integrated with the team.” Instead, the focus is on ensuring high-quality integrations with customers, developing strong, lasting and high-value partnerships before increasing their headcount.”
In a similar way, Purple Dot is not currently seeking additional funding. Having won £1.35 million seed funding, led by Connect Ventures, last year they are clear that their focus is on making sure there is a return on that investment. Parra told us, “We’re savvy spenders. We’re concentrating on finding our market fit, our partnerships and getting our case studies out. We’ve got investors who are super supportive of what we are doing, and we’re careful with the money!”
As an innovative tech startup, Purple Dot is still trying to establish its potential market’s exact size. While some purchases, like groceries or products needed urgently, will not be suitable for wait-based shopping, there is still a significant market.
“There is a percentage of all discretionary shopping that we can capture,” Parra told us, noting that Purple Dot offered something to consumers as well as retailers. “Shoppers can feel they are helping the industry by being more sustainable while also benefiting from the convenience or savings of waitlists.” With global e-commerce expected to be worth more than US$6 trillion in 2022, even a small percentage will give us a huge market.