Data-Driven Innovation for Purpose with Sam Wood, Azura Fashion Group

Michelle Lomas: Hey there hustlers. Welcome back to another episode of Flex Your Hustle. I'm your host, Michelle Lomas, and this week I got the pleasure to sit down in the studio with Sam Wood, the CEO and co-founder of Azura Fashion Group. You might be forgiven for thinking Azura Fashion Group is all about, well, fashion that as our discussion will uncover Azura is so much more than that.

Michelle Lomas: At its heart, it's a technology company on a mission to lower the Globes annual waste, when it comes to clothing. How? You'll just have to listen to find out. Sam and I sat down to talk about how the business was formed. What's next for Azura Fashion Group, including their new venture, Azura Reborn, and some super interesting new trends hitting the global influencer in shopping market.

Michelle Lomas: This is a story, not a fashion, but of how to build smart ideas with a purpose and a celebration of another Aussie company making waves in the global marketplace. And I hope you enjoy.

Michelle Lomas: Sam, thank you so much for joining us today. Really appreciate it. Coming all the way from Newcastle, which is a bit of a hard slog all the way down to Sydney on a rainy day.

Michelle Lomas: So thank you. Why don't we start off for the listeners, if you can tell us a little bit about yourself and where you're from.

Samuel Wood: Perfect. No, thanks for having me. So I'm Sam Wood. I'm the CEO and founder of Azura Fashion Group, and I founded it with my business partner, Tim Law. We founded Azura Fashion Group on the back of Burberry, Louis Vuitton Prada getting done for burning their excess stock and destroying all these, all their excess stock to keep it out of the hands of discounters and to keep their the brand a premium.

Michelle Lomas: For the listeners. There might not be people who know about this. So explain like what happened. 'Cause this was huge news and I was working in New York at the time in a fashion house and it was all of a sudden we had people walking around in the fashion house not wearing like Burberry for instance, and some of the brands that were really called out for this.

Michelle Lomas: Quite astonishing behaviour. So for everyone listening who isn't aware, do you wanna dive in a little bit about what happened?

Samuel Wood: Yeah, definitely. So I guess the one that we kind really zoomed in on was Burberry. Basically, they were holding stock back from wholesalers and retailers because they didn't want the Burberry name to be tarnished by discounting it all.

Samuel Wood: This kind of happened year on year, but one year particular, which was 2019 they burnt over, I think it was close to 200 million dollars worth of stock. Where they would just destroy and burn to keep it from damaging the brand and from discounters liquidating it to get rid of floor stock or excess stock.

Michelle Lomas: Yeah.

Samuel Wood: Nike were part of this, Prada, Louis Vuitton. There were a number of brands that were part of this. And this was all over the news that went, when it came out and we were talking with a a retailer as well as a supplier that would buy Dolce and Gabana in bulk, during that time.

Samuel Wood: And obviously this was something that he was struggling with as well. So what we wanted to do was create a platform for brands to be able to sell their off season and past season products into new markets without having to heavily discount. So we built Azura Runway. But by building that we also fixed another need too which was the need of these wholesalers or the number one distributors like catering or the, this wholesaler that would buy Dolce & Gabana in pallet loads that would then sell it in pallet loads.

Samuel Wood: But always be left with the ones and twos, like the an X L Dolce suit that might not sell very well in Italy. But when we plugged it into our system, we found that it sold very well in the US, and in Australia, and New Zealand just because of the different demographic. So that's how Azura Runway was founded when the company first started.

Samuel Wood: And how we progressed from there was, rather than going out as a direct to consumer model and targeting that, that B2B, B2C avenue, we decided to go down the path of retailers because when we started looking through Marketing spends and Google Shopping, it was, we're competing with the likes of the brands themself.

Samuel Wood: Farfetch, Net a' Porter, asos, all these companies that had massive spends because everything we were selling was luxury or high-end fashion. So we decided to go down the retailer path. So we, instead of competing with these retailers. We started-

Michelle Lomas: Partnering with them. Great.

Samuel Wood: So we started partnering with the likes of eBay, Amazon and Catch of the Day first in Australia to test that market.

Samuel Wood: Cause that's where we were, we originated from. And that kind of took off from day one cause no one else could get these kind of products at at these kind of ranges as well. And because they were past season, they did come with quite a, a heavy discount with them as well, if the brands allowed. Otherwise they were just pieces that no one else could find. So that kind of rolled out from there and the business started to evolve and grow to a point where we are now selling across 65 retailers around the world, and we are buying from boutiques and brands in 17 countries now.

Samuel Wood: It's really evolved from that point of view, and that's how the business started and grew.

Michelle Lomas: Incredible. The scale of which you guys have grown in such a short period of time. I'm really interested in how you sort of started out as this retailer and then very quickly pivoted to partnering with other retailers and being almost like I guess, the backend feel that you know, of, of all the products that they sell.

Michelle Lomas: So like what was that process like? When did you figure it out and did you pivot quickly or did you take some time?

Samuel Wood: We kind of pivoted from almost day one. We worked out in, when we were doing the business plan that doing Google Shopping was never gonna be a viable option. Just because of kind of the cost per click and everything with these brand terms.

Samuel Wood: We did try for a few months where we would push through the kind of a Azura runway as a D2C brand, but we just found from, almost from day one what the revenue we were doing through eBay, Catch, and Amazon was just, almost 10 times revenue we're doing through our own site. So we saw the opportunity there and ran with it with both hands. And by not having our own store focusing on we weren't competing with these retailers as well so, we could kind of partner with them on a holistic level more than just a buyer seller relationship. And that's really how we've grown the business from there.

Michelle Lomas: Yeah. Great. If you can't beat them, join them.

Samuel Wood: Exactly.

Michelle Lomas: And I like the fact you didn't hold onto you know, your own site. You kind of went well, no. Like, that's just a distraction. Let's just focus on these partnerships. The interesting part of your business is you're kind of like a tech platform and you use a lot of data to be able to discern what's gonna work where.

Michelle Lomas: So why don't you talk about that?

Samuel Wood: Yeah, exactly. That was probably the biggest hurdle that we came across when we first started. Especially for when we were buying from wholesalers or the number one distributor, a lot of them would be line items where there'd be very little data in the actual data feeds, for the products. So for example, it would be a Armani Black T-shirt. It wouldn't have anything like crew cut, it wouldn't have polo, it wouldn't have, the size would be in Italian. It would have it wouldn't have the material with it. It would be very basic. So we used different technologies and data to transform that and build that out and work out all right that we needed to convert Italian sizing to international sizing or we needed to convert Italian sizing to US sizing, australian sizing, UK sizing 'cause as we grew the business, we decided to branch out internationally.

Samuel Wood: The data we received from these brands is very limited, which is what also restricts a lot of companies from getting into this space. So we've developed our business to be more of a tech company, more than a fashion company or a retailer because our whole business relies on this data.

Samuel Wood: Now, as we build the business more. We're now focusing on more of the strategic partnerships. When we first started, Farfetch was one of the companies that we aspired to and wanted to replicate a little bit in terms of how their business model with the suppliers and working with boutiques and trying to get Australian designers to the world.

Samuel Wood: And focusing on different pieces around that. We've now since entered into an exclusive arrangement with Farfetch where we. Look after all of their pre-loved fashion. So we get a, a feed from Farfetch which would give us all their pre-loved items. But also we've now launched our buyback solution as well, which is customers can sell their bags back to us in exchange for credit to buy

Michelle Lomas: Amazing.

Samuel Wood: Another pre-loved bag.

Michelle Lomas: Yeah.

Samuel Wood: And again, it's powered by Farfetch.

Michelle Lomas: Yeah, let's talk about that. I know that's your new passion project, so let's talk about it. Where'd you get there? Is this a nice evolution? How's it going for you? And maybe for people listening as well, like how can they get access to some of it?

Samuel Wood: Yeah. So middle of last year we launched Azura buyback, sorry, azura Pre-loved, which was our pre-loved fashion which was only luxury pre-loved, so the Chanels, the Louis Vuittons, the Pradas, gucci's all the pre-loved bags. And then we've slowly rolled that out to incorporate clothing. And we partnered with The Iconic middle of last year.

Samuel Wood: And have launched The Iconic's whole range of pre-loved Azura Reborn which is now selling through The Iconic for luxury bags. That kind of took off through The Iconic, but also through other channels. Where pre-lovedd is now 40 to 60% of our revenue, at any one time. Now it's probably close to 60.

Samuel Wood: And that's really where we are trying to focus in on this market. We're seeing that the trend of fast fashion is slowly. Eroding.

Michelle Lomas: Yeah.

Samuel Wood: Fashion in general is continuing to stabilise, not growing too much. But luxury pre-loved fashion is growing at 16 times.

Michelle Lomas: Isn't that incredible?

Samuel Wood: It's huge. It is growing from a standing start, but it is growing at,

Michelle Lomas: It's so great.

Samuel Wood: A huge rate.

Michelle Lomas: Yeah. Excellent. I'm curious as to know your first round, your first founder piece, you didn't want to do a direct to consumer site, and now you are doing a direct to consumer site. What's the thinking behind that?

Samuel Wood: We just found that there was no one really doing pre-loved well in Australia. And we saw the opportunity where even through the year of Covid for us, pre-loved fashion just climbed and climbed in terms of market share for us we are now connected to boutiques and auction houses and Farfetch and now Neta Porter that where we buy leather, luxury fashion, pre-loved.

Samuel Wood: So we've got close to 60,000 bags at any one time.

Michelle Lomas: Amazing.

Samuel Wood: On Azura Reborn.

Michelle Lomas: Oh my God the, the women listening are gonna be like, oh my God, what is this site? I'm going on there. Yeah.

Samuel Wood: And it's just a really good piece as well. And I guess going out there and saying, oh, we sell luxury fashion and we sell past season products it is already a good story to go out there and stop this products from any in the landfill.

Samuel Wood: But going out there with a pre-loved message just emphasises that a bit more.

Michelle Lomas: Interesting. So how are you kind of marketing this? Because there's obviously a lot of messaging involved with this at many levels. The environmental responsibility factor, the access to, to products at cheaper prices, the ability to sort of sell and buy.

Michelle Lomas: So what's your marketing look like and how's it going?

Samuel Wood: So we've been quite quiet with the marketing in terms of launching the business. We wanted to get the foundation right. But we've gone through a lot of PR with Marie Claire Magazine. We've gone through Seven News and through other PR outlets to just show the market that we are here and that, that pre-loved is an educational piece more so than just, here's pre-loved, go and buy it. It's more you can monetise your wardrobe or this is the difference it makes on the environment by buying from pre-loved fashion. We also look at different ways of doing social selling. So as I mentioned, we're doing things with influencers in the US and we're starting to do it in Australia where people are coming to our warehouse or office and just doing a live stream and auction of some of the bags we've got there and and we are finding that, especially millennials, they just love that and it's just being able to see it, watch it.

Michelle Lomas: What do they do? They do, what do they, how do they engage?

Samuel Wood: It's just basically how they start. And there's a platform called Get Wanted. There's a little plug. But they go on the site, they upload their credit card.

Samuel Wood: And then, and someone kind of sits there on, in their office. And goes through, alright, we've got a Louis Vuitton Keepall 50 bag. It's, and they go open the bag and show around

Michelle Lomas: Oh my god.

Samuel Wood: Pieces.

Michelle Lomas: It's like telly shopping in the nineties

Samuel Wood: and it is, and it is, and this launched in Asia probably five years ago.

Michelle Lomas: Yeah.

Samuel Wood: And this is how all people shop through Alibaba, Lazada, so it's just rolling out in, into the western world. Yeah. And I'm assuming that it's gonna come to Australia within the next little while.

Michelle Lomas: Yeah.

Samuel Wood: Um, Because it's just way that people shopping now.

Michelle Lomas: What's the adoption of that like at the moment in Australia?

Samuel Wood: In Australia it's been quite slow.

Michelle Lomas: Yeah.

Samuel Wood: In the US it's huge.

Michelle Lomas: It's getting there. I know, I think Amazon and a few others deploy those tactics now as well.

Samuel Wood: They're starting to. Yeah. I think eBay are looking to do it as well.

Michelle Lomas: Yeah.

Samuel Wood: And I know The Iconic are probably looking at this as well, but it, it is something that, that in, especially in the US like you've got Depop, Poshmark, Get Wanted, stockX and they're all doing the same thing. It's how people can really liquidate these bags and someone with a following and it doesn't need to be a following of hundreds of thousands. It just needs to be someone that has a following that knows fashion.

Michelle Lomas: That's fascinating. I don't know, I just feel like we go through so many iterations of the same thing sometimes in marketing, like to hear that we're basically doing buying live on social, the same thing we used to do on TV.

Samuel Wood: Yes.

Michelle Lomas: With the lovely lady that would come out with the beautiful pearls that you could buy by calling the number and we're doing it again.

Samuel Wood: Yep.

Michelle Lomas: It's, it just baffles me, but it's really interesting. So you guys are you know, you've scaled to global heights, really. What do you think your secret is?

Samuel Wood: We've always been in sales and we've always been in, in trade, so buying and selling and using different commodities. But this has been very much about relationships for us and having these earlier conversations with wholesalers or the, even the brands themselves and finding out where these pain points are.

Samuel Wood: But we worked with a store during Covid in Bondi where they had all this Armani stock that they had on their floor, but because of Covid, their foot traffic just died. They had no online presence at all. So we partnered with them. We went in there and saw them and partnered with them and helped them get their products online.

Samuel Wood: And we shifted their whole floor stock. We're not a big fashion company that's here to provide huge profits and take advantage of different things. We're a tech company, but we're, it's the relationships we are building with the suppliers and dealing with the marketplaces that we can say, we can help you by doing this, and we're helping the marketplace by giving.

Samuel Wood: Their customers access to these products. So it's really being a middle person and facilitating these campaigns. And I think that gets lost a lot of the way in with retailers and suppliers where it's buy us, sell our relationship where we've tried to partner with everyone we can even to the point where we're partnering now with Farfetch, which should be our biggest competitor, but, we're now our biggest partner.

Samuel Wood: We work with almost, I think it's 13 retailers in Australia that do luxury fashion. We partner with them because rather than competing with them, we're helping them get access to more stock, but they're also giving access to our suppliers to be able to offload some of their stock as well. It's how we built the business.

Samuel Wood: It's all on relationships.

Michelle Lomas: Yeah. It's interesting. I think there'd be a lot of people listening who might be interested and curious about that because there's always kind of, I guess, a desire to keep everything in house, keep my product in house. I'm gonna compete, I'm gonna compete and certainly like with some of these bigger retailers, It's too hard to compete anymore.

Samuel Wood: Yes.

Michelle Lomas: We've talked a lot about lots of trends that are happening in fashion, et cetera and shopping. I'm curious to get your perspective on the trends that you're sort of seeing in the affiliate marketing space too. Cause I know you work quite heavily with the Commission Factory team and in the affiliate space.

Samuel Wood: Definitely. And I think when we first launched the business through, with the Azura Runway, which was all our kind of the new products and the off season products Google Shopping, and paid social was just wasn't quite an option for us because of how competitive it was and the kind of brands that we were selling.

Samuel Wood: So we went down the kind of affiliate marketing avenue and we partnered with the Commission Factory, and we went through a number of different affiliates that would push out products until we found the right ones that were fashion centric or ones that were going to an audience like Stay at Home Mum.

Samuel Wood: The blogging website. We partnered with them and we just found that the traffic we're getting from these sites and the conversions that were coming out of it were fantastic. So got around the need for actually going out there and promoting the store.

Michelle Lomas: Yeah.

Samuel Wood: Through paid socials or paid marketing.

Samuel Wood: So cause Commission Factory was driving us enough leads and conversions from the affiliates we're partnering with, so to now to a point where we're looking at how do we become more selective with Azura Reborn with Commission Factory and work, work out how we can partner with other people that share the same message.

Samuel Wood: So it's not going out there to a hundred affiliates, it's going out to maybe three or four affiliates, but doing, again, collaborations with them and doing really cool things of them like offering their members birthday gift cards or offering a collaboration with their company. For example, for a Stay at Home Mum blog, we would offer, for example, the mums a discount code, or we would offer an extra 20% when they trade in their bags.

Samuel Wood: And just different things that we can try with them and even do guest blogs on our own site is get some of these influences or bloggers to come along to our site, try some of our fashion, or try the experience and then talk about their own experience or with fashion. We did a campaign with Havana Brown, the DJ and she was talking about how she had a Dolce & Gabana choker that she was eyeing off in this store for years and years. This one Dolce & Gabana choker has had meaning to her before for years. So she's really had a story and a memory with that experience.

Michelle Lomas: I love that. I think there's such a misconception with affiliate marketing that it can't be creative and it can't be content led and it can't be collaborative like that.

Michelle Lomas: That's such a collaborative kind of approach to thinking about how to promote what you guys do. And also laddering back to the insights that you talked about before where people want to know again more about the brand. There's a story behind it that, that sentimentality and collecting fashion pieces is becoming much bigger again just like it used to be.

Michelle Lomas: Super interesting. Do you think from what you're seeing in terms of particularly I guess the influence market and things like that, that is changing and evolving as well in the affiliate space.

Samuel Wood: Definitely.

Samuel Wood: And I think one of the biggest things that we're seeing come out of the US especially is influencers partnering with brands.

Samuel Wood: Like the Jenners have just done with the teeth whitening. All they're doing for is becoming a brand ambassador. So basically for us, how it would work would be, say Miranda Kerr created a vintage clothing store, and that would be powered by a Azura Reborn. So Azura Reborn would list all the products on these this store and Miranda Kerr would go out there and talk about it and promote it to her followers.

Michelle Lomas: Fascinating.

Samuel Wood: Um, And we would basically be the backend behind it. And doing that, and we're finding there's a lot of companies popping up that are doing that through affiliate marketing.

Michelle Lomas: That's super interesting. And for a consumer they wouldn't know the difference, right?

Samuel Wood: No. No, exactly.

Michelle Lomas: They just think they're buying a celebrity brand and something that a celebrity's created when in fact it's not at all.

Samuel Wood: Exactly.

Michelle Lomas: You are obviously also hugely know, knowledgeable in the kind of consumer buying space and all the trends that are happening. For anyone listening and thinking about, okay, what's next from a how consumers buy and how they shop and their decision making process, what sort of advice do you have them?

Samuel Wood: I think the next 12 months are gonna be quite interesting in terms of how people are going to shop. A lot of people now are looking at AI and looking at being told what to go and buy and how to, and how trends are being done. But I think we are moving away from those Instagram days where, you see something on the Kardashians and you go out and buy it from Zara the next day.

Samuel Wood: Yeah. I think that's that process is gone or going. So it's more so about having one of the kind pieces that we're finding, it's having pieces that no one else is wearing or pieces that you're supporting a brand. And that's a lot of the retail conferences that we've been going to is all about how to be more in touch with the customer, how to have more brand loyalty and how to have more engagement with those customers.

Michelle Lomas: Yeah. Really interesting. It's almost like we've come full circle again it became, very much about price and convenience. Price and convenience, Price and convenience. People are starting to be a little bit more discerning about the products that they're purchasing. Do you think from a, a circular economy standpoint, even just corporate and environmental responsibility, how is that set to grow?

Michelle Lomas: What do you think's gonna happen in that space, particularly in the fashion space? Notorious for not being

Samuel Wood: Correct.

Michelle Lomas: Environmentally friendly.

Samuel Wood: I think every company is looking at ways how they can start going down this, this, this avenue. Mm-hmm. Whether it's the, the satchel bags that they go out in, we've just adopted like a plastic, which is the plastic that's taken outta the ocean to build the satchel bags.

Michelle Lomas: Oh, incredible.

Samuel Wood: So it's going through different pieces like that. Every brand that we speak to is doing something around that model. And I think returns are the biggest headache for all retailers because the return policies and everything else, it, it just, they're just dead stock.

Samuel Wood: It's just dead money sitting on the floor. So being able to liquidate them through pre-loved is now a, an avenue for brands to be able to go down and liquidate the stock, but also join that circular economy and show that they're actually care.

Michelle Lomas: They're doing something about it.

Michelle Lomas: It's interesting, to your point, I think it doesn't have to be such a big thing to start off with, does it?

Samuel Wood: Correct.

Michelle Lomas: Changing your packaging reselling it. Like those are the little things that can make such a big difference.

Samuel Wood: Definitely. And there's so many partners out there that we found rather than trying to reinvent the wheel.

Samuel Wood: We found that working with partners is a better way of going out there to market. So we are looking at. How do we start renting out some of our returns, or how do we start renting out pre-loved items? So rather than going and building a whole new renting platform, we work with the likes of Designer X or Air Robe, and we look at how we can rent through those platforms and leverage their already existing technology and the databases.

Samuel Wood: So I think this next year with retail especially, it's gonna be collaborations. You see it with Nike and Tiffany and co. It's all about collaborations at the moment. So I think we will see something with The Iconic doing a collaboration with maybe Myer or, or something along those lines where it's more and more happening

Michelle Lomas: and also create that kind of cool factor for consumers too.

Samuel Wood: Correct.

Michelle Lomas: I'm getting something that's limited, it's only out for a short period of time and that's something that I can keep and collect and not feel bad about. I'm buying something cheap that I'm gonna throw out in three months time.

Samuel Wood: Exactly.

Michelle Lomas: All right, Sam, thank you so much for joining us and sharing your story

Samuel Wood: Thank you.

Michelle Lomas: Really appreciate you coming in and um, good luck with it. I don't think I have to say good luck. You guys are doing great.

Samuel Wood: No, thank you very much. Been great.

Michelle Lomas: Thanks so much for listening to another great episode of Flex Your Hustle. I don't know about you, but this has certainly inspired me to be a little bit more mindful about how I shop and how I research my products. Next week we have another great episode to get inspired by. Here's a sneak peek.

Isabella Cavallaro: I think it's important when it comes to your affiliate program to work with affiliates that you can't necessarily implement in-house. So say for example, you wanna target students and that's really difficult to implement in-house, perhaps consider a student partner that has access to do that.

Isabella Cavallaro: Likewise, we work with a range of specialised tech partners that you know, specialize in things like cart abandonment and all this. Really advanced tech sort of lingo. And if you can't do that in-house again, why not do it by the affiliate space? And I think we always say as well that the cost per acquisition model, which by all affiliates sort of work with it, is really cost effective to do that as well.

Isabella Cavallaro: Rather than you know, looking at that in-house and getting that implemented in-house. You can always use the third party provider to help you do that.

Michelle Lomas: If you aren't already, don't forget to follow, so you don't miss an ep. And while you're there, why not drop us a rating and review? We'd love to hear what you think.

Michelle Lomas: Flex Your Hustle is made possible by the great team at Commission Factory and produced by Ampel. I'm Michelle Lomas. Keep hustling and bye for now.