Dubizzle provides $1m backing for fashion app Shedd

The Shedd app allows buyers and sellers to chat about the items on sale and create a trading community.

Dubizzle has bankrolled Shedd, a locally developed mobile app for fashion items, to the tune of US$1 million.

It is the first investment the classified ads website has made outside its core business since it started 10 years ago.

Shedd, the brainchild of two former Dubizzle employees, Tariq Zabian and Alex Hutley, is a social/classified mobile app for fashion items predominantly targeting women. The app allows buyers and sellers to chat about the items on sale and create a trading community.

“We thought that second-hand clothing was an underserved segment of retail in the region,” said Mr Hutley.

“We commissioned research before launch and found 60 per cent of a woman’s wardrobe is either never worn or only worn once.

“Shedd is a platform that not only allows buying and selling, but it engenders trust which for smaller items one needs. If you like something on the site you can message that person through the app and discuss it.”

The mobile retail space is regarded as a big opportunity in the Middle East, with its burgeoning population and high smartphone usage.

Data from Ovum, a research and advisory firm in Dubai, shows the UAE had a 60 per cent smartphone penetration rate out of the total number of mobile phone users at the end of last year, compared with 50 per cent for Saudi Arabia, 56 per cent for Qatar and 58 per cent for ­Bahrain.

Penetration is expected to increase by 39 per cent in the Middle East through 2015.

However, the preference of people to pay for their goods via cash on delivery (COD), is holding back the growth of the sector.

Souq.com has said 76 per cent of its sales are done on the basis of COD.

Shedd has avoided the online payment problem by offering two payment options: a face-to-face meeting – which is similar to COD – or using PayPal, an online payment provider, which also provides payment protection should the garment you buy turn out to be something other than you thought. Shedd will levy a fee of 10 per cent should PayPal facilitate the sale.

“While Dubizzle has bankrolled us we will be exclusive to our own buyers and sellers,” said Mr Zabian. “ We intend to have a far bigger inventory than Dubizzle has with regard to fashion and accessories.”

Currently Dubizzle has more than 15,000 items listed for sale under its clothing and accessories section.

Separately, Google has added another layer to the digital landscape in the region.

It is launching www.thinkwithgoogle.ae, a hub that steers advertisers, marketers and creatives through the search engine’s findings.

“It is for the whole spectrum of digital players,” said Bilal Kabbani, a Google marketing head for the Mena region.

“It is great for start-ups as it explains exactly where and how you should be marketing your product or services,” he added.

He said that in comparison with the United Kingdom, where the digital ad spend is about 50 per cent of revenues, in this region it is 5 to 10 per cent which, with “mobile penetration, makes little sense”.

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