The inspiration for this column was the astounding infographic below. The topic of the column I had originally planned to write was quite a formal one: "How did SoftBank become a global company?" Yet, I quickly changed the topic once I saw the online business sales rankings below. The table, which has completely turned my plan around, shows the sales ranking of Korean online businesses in 2014.

As you might have guessed, Naver tops the list with 2.7 trillion KRW in sales. You might have been able to guess most of the companies that follow, such as SK Planet, Daum Kakao, eBay, and even WeMakePrice. But, you probably would have been surprised to see the upstart 'STYLENANDA' at 10. "What is this?!"
Most of you might not have heard of STYLENANDA. As a famous Korean shopping mall specializing in women's clothing, STYLENANDA earned 115.1 billion KRW in sales in 2014. It is truly amazing that STYLENANDA recorded about a hundred billion won in sales, beating other leading online businesses in Korea. Come to think of it, fashion is similar to cosmetics in many ways, as it mostly targets women, is grounded on manufacturing, and is sensitive to trends.

So, looking into the story of STYLENANDA, a rising star of the fashion industry, will definitely provide us with some useful implications of relevance to our business as it takes on the challenge of digital. That is why I am about to introduce the story of their innovation here.

There are many amazing aspects to STYLENANDA's performance: that its growth rate has exceeded 80% in the past 3 years, and that it is showing a high rate of operating profit at 20%, which is rare in the shopping mall industry. Let me tell you about the hidden story of change and innovation in STYLENANDA's success by covering the topics as follows: 1) brand, 2) core competences, 3) expansion of lines, and 4) distribution strategies.

Here is a simple quiz.
Which one of the following is a STYLENANDA outfit?
And the answer? It's ③ of course!

Actually, what most women wear on a daily basis are styles ① and ②. To someone like me with no interest in fashion, ③ seems "a little too much." But, for customers who want a different and special look, STYLENANDA's clothes are worthy of attention for their "sexy vintage" style. As represented by the main slogan, "I am out of your league," STYLENANDA starts from women's desire to stand out wherever they go.

With its brand persona 'Nanda Girl,' STYLENANDA established its identity by presenting bold makeup like a page torn out from a magazine, along with a sentimental and vintage mood. While other shopping malls selling women's clothing have focused on trends and public taste, STYLENANDA positioned the brand successfully with its unique and unconventional concept.

STYLENANDA calls its consumers not 'customers' but 'sisters (sis)'. STYLENANDA's online comments seem intimate and friendly, like a conversation between sisters, not between a brand and its consumer. This friendly communication does not seem formal, but connects the brand to its consumers.

To provide this kind of customer service, STYLENANDA has over 25 counselors in charge of customer service. They take care of over 3-400 cases of customer inquiries and complaints every day on a real-time basis. When customers post inquiries about sizes, deliveries or refunds on the website, employees with unique nicknames such as 'Wingnanda,' 'Smilenanda' and 'Flowernanda' provide real-time answers.

Visit most online shopping malls, and you'll be met by a flurry of flashing banners and appealing messages like '67% discount' or 'cashback,' each vying for your attention. However, the main page of the STYLENANDA website makes you feel as if you are looking at pages of a magazine, not a clothes shopping mall. My wife, who occasionally purchases goods from STYLENANDA, tells me that she likes to visit the website whenever she wants a little pick-me-up. It seems that customers visit STYLENANDA to enjoy shopping quickly and simply, in the same way that they would watch a fashion commercial, read a magazine, or look at a friend's blog or photo album, even if they do not necessarily have something to buy.

So excellent is the quality of STYLENANDA's product images that they are indistinguishable from those you'd find in a professional fashion magazine. Models, also known as 'Nanda Girls,' are hired as permanent employees rather than freelancers and thus work as exclusive models of the brand. This shows how the shopping mall grows together with the models. We can see that STYLENANDA is selling not just fashion per se, but fashion culture itself.

Communication focused on contents rather than products has been the key to STYLENANDA's success. STYLENANDA began when CEO Kim So-hee, who had been helping her mother sell underwear, edited the images of products on Photoshop and sold them online, gaining a profit of 10 million KRW a month. She has always sought ways to best present 'hot' styles to customers more 'beautifully.'

The unique world of women of around the same age and with similar tastes is reflected generally throughout everything "STYLENANDA," such as the layout of the website, products, and images, which provide a positive brand experience for customers.

What actually made the online shopping mall STYLENANDA really hot was, ironically, its first offline store in 2012. On the back of a record 30 billion KRW in sales – making it the top brand among shopping malls for women's fashion – STYLENANDA decided to roll the dice again by breaking away from the limitations of the online channel.

Have you ever heard of an online shopping mall brand entering the main branch of Lotte Department Store? It might not have been an easy decision for the department store, even if it had successfully attracted customers with SPA brands like ZARA or H&M. Before STYLENANDA opened its first store at Young Plaza of Lotte Department Store in September 2012, some merchandisers in Lotte were against the idea of STYLENANDA entering the department store, complaining that it was not classy enough. But, the brand proved them wrong, ranking among the highest last year in sales at Young Plaza, with monthly average sales of more than 0.9 billion KRW. STYLENANDA ended up having a presence in 7 more Lotte Department Stores.

STYLENANDA's brands that entered Lotte Department Store's Young Plaza at the end of 2012 have been on a roll since 2013, and are particularly well loved by youke (Chinese tourists). Even on a weekday, you can see countless customers crowding the STYLENANDA and 3 CONCEPT EYES (3CE) stores at Young Plaza in Myeong-dong.

STYLENANDA has its own line of products with the 'MADE Line,' the cosmetics brand '3CE (3 CONCEPT EYES),' and the street fashion brand 'KKXX.' Of them, KKXX is currently showing the highest rate of sales growth, while cosmetics brand 3CE remains by far the greatest contributor to total sales.

STYLENANDA launched the cosmetics brand 3CE in 2009 after 3 years of preparation. The brand chiefly consists of cosmetics products fit for a sexy and bubbly fashion style. In line with its status as a sub-brand, the majority of its sales come from point makeup products such as lip products and blushers. When it was first launched, 3CE gave out products for free to stylists sponsored by STYLENANDA, and the brand went viral as the products were offered to be tested by celebrities.

STYLENANDA started out as an online shopping mall that re-sold the goods it purchased from outside, but what leads its growth today are its own brands. Indeed, while there has been little change in the sales of goods that are purchased from the outside and resold to consumers, there has been explosive growth in the sales of products by its own brands that have been internally manufactured and processed. As a result, operating profit has shot up.

Some people expect that China's increasing demand for STYLENANDA may end up being just a fad, but I don't think there is any other online business in Korea that's targeting China and turning over as much sales as this. What we can see from the outside is that STYLENANDA has managed to expand its portfolio with the makeup brand 3CE and that it has succeeded in entering the department store channel. At the same time, it might have been impossible to cope with this growth without its strong production, inventory, logistics and management infrastructure, particularly given the nature of the apparel business.

In writing this column, I have been struck by the thought that STYLENANDA should not be defined merely as a clothes shopping mall. Rather, it is perhaps best thought of as a contents provider. In other words, STYLENANDA creates cultural contents rather than products.

Of course, there are multiple factors behind STYLENANDA's success. But, the most essential factor is STYLENANDA's way of understanding women's desire to be beautiful, as well as the prompt measures it has taken to build on its strengths, which is a good example of speed management.