Jabong

» see jabong.com as it lived, on the wayback machine

~ the eulogy ~

For most of the 2010s online fashion in India was a two-horse race, and anybody watching the discounting knew that one of the horses was going to be bought rather than beaten. Jabong opened in beta in December 2011 and went live in January 2012 out of Gurugram, selling clothes and shoes to a country that was still deciding whether it trusted a website with a card number.

It was quick out of the gate. By March 2013 it was dispatching six thousand orders a day, and by the end of its first year The Economist put its gross sales somewhere between a hundred and a hundred and fifty million dollars. Cash on delivery did most of that work, helped along by an advertising budget that behaved as though the market had a finish line.

Behind it sat Rocket Internet, the Berlin firm that identified a working American business, rebuilt it in a country that did not have one yet and then sold the result to whoever most needed to own it. Jabong was the Indian entry in a portfolio that also held Zalando in Europe and Zalora in southeast Asia. In 2014 the fashion ones were folded together into Global Fashion Group with backing from Kinnevik.

The founders left in the order that people leave that kind of company. Manu Kumar Jain, one of the four, walked out in 2014 to start Xiaomi's India business and became far more famous doing that than he ever was selling dresses.

None of this happened anywhere near me, and the reason to write it down anyway is that the shape is legible from any country that got its own version. Somebody works out that a category can be moved online, the money arrives faster than the customers do, and two well-funded sites then spend four years teaching an entire market that clothes are supposed to be forty percent off. The market learns it permanently. The sites do not survive it, and the one that survives is the one whose owner has deeper pockets rather than a better product.

~ the dossier ~

~ built from a template ~

Rocket Internet's method was never a secret and the company was not embarrassed by it. Take a model that has been proven in the United States, launch it in a market where nobody has done it yet, hire aggressively, spend on customer acquisition until the numbers look like dominance, and exit. The word used at the time was incubation. Applied to India it produced Jabong at speed, with a warehouse and a national brand campaign inside a year.

What the template did not include was a route to profit that did not depend on someone else buying you. The Rocket Internet investor deck for the first quarter of 2016 showed revenue of 32.6 million euros for the quarter, which is a real business by most measures and was not enough. The company had spent four years buying a customer base at a price the customer base was never going to repay.

~ what seventy million bought ~

On 26 July 2016 Myntra bought Jabong for about seventy million dollars in cash, on behalf of its own owner Flipkart. For a site that had raised several hundred million dollars, that price is the whole story of the previous two years. More than a hundred and fifty people were let go in the weeks after.

The stated plan was to run two brands at different ends of the market. What happened instead was consolidation: in November 2018 the two operations were merged and around half the combined workforce went, and in November 2019 Flipkart, by then owned by Walmart, took a non-cash impairment charge of 290 million dollars. That is an accountant writing down the value of something the company still technically owned and had already stopped believing in.

~ the redirect ~

The end came without a statement. On 5 February 2020 Indian technology press noticed that jabong.com and the Jabong app were both landing on Myntra, and that was the announcement. There was no farewell page and no thank-you note to eight years of customers, only a redirect and a company confirming afterwards that the brand had been retired.

It is a cleaner death than most sites get, in the sense that nothing was lost. Orders kept working and the warehouses stayed open under another name, and the people who had bought clothes from Jabong went on buying the same clothes from the site that owned it. What went away was the second option, which was the only thing that had made either site try.

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