Mercaux bags $4.5M to help bricks-and-mortar retail tool up to sell more
Retail tech SaaS platform Mercaux has closed a £3.5 million (~$4.5M) Series A funding round led by European VC fund Nauta Capital.
The 2013 founded London-based startup sells software for retailers to tap into digital capabilities in their physical retail stores — offering a modular platform that’s intended to support digital transformations at a pace of the retailer’s choosing.
“Historically offline retail was just a sales channel. But with the rise of e-commerce, and ability to communicate with clients digitally at any moment of time, offline stores (and in-store employees) have started to play multiple roles,” says founder and CEO Olga Kotsur.
Physical stores are “not just a sales channel but also an e-commerce window, marketing channel, customer relationship centre” and much more, she argues.
Or, well, they can be — if retailers spend to upgrade legacy IT systems that have not been designed with more expansive digital shopping capabilities in mind.
Mercaux’s platform offers a pick n mix of services intended to empower retailers’ employees to sell more — such as by tapping into up-to-the-minute style suggestions — and thereby “improve and personalise the in-store customer journey”.
On a practical level this translates into real-time access to inventory levels in-store and online at one end; through merchandising content via cross-sell suggestions and styling ideas (powered by crowdsourcing); digital marketing content; all the way up to customer profiles and preferences, pulling on personal data to better inform and steer the in store shopping experience.
At the business end, the platform plugs into retailers’ POS and e-commerce systems to power instant online and checkout sales. On top of that its value-add is assistant tools and analytics for in-store sales people, as well as a channel through which they can communicate with each other and Head Office.
By capturing the usage of the app, the platform also provides retailers with an overview of store analytics — serving up insights on shoppers’ behaviour, most popular products, lost sales and so on.
The SaaS platform can be deployed on a variety of hardware touchpoints, including in-store kiosks.
“Mercaux integrates across all retailers digital touchpoints, making existing data (CRM, Inventory, or Marketing) actionable in-store and enhancing it further,” says Kotsur. “It also follows a ‘lego approach’: modularity in terms of features, flexible configuration and easy integration allow retailers to launch first what they can or need most (for example real-time inventory and recommendations for effective selling), and gradually enhance the platform subject to their new needs (for example customer profiles and preferences for personalised experience).”
The company claims its platform drives an up to a 14% increase in direct store sales — achieved via store conversion and basket size uplift as well as new omni-channel sales.
It also reckons it can quantify its “sales people efficiency” gains — claiming to eke out up to a fifth more productivity from your humans thanks to digital aids like its mobile sales assistant app. (It offers “help” with initial training of salespeople but Kotsur suggests the app is intuitive enough that sales people “normally adopt it in a matter of days”.)
“Conversion increases due to more effective sales people who do not waste time walking away from a customer, can confidently offer alternative if something is not available, or can show all options via catalogue,” she continues. “Basket size increases due to cross-sell and styling suggestions. Omni-channel sales means new online orders directly from stores or e-commerce purchase by a customer after receiving a follow up email post store visit.
“Our most recent UK customer Karen Millen, realised +9% store sales increase in less than 3 months.”
Deployment time for integrating the platform varies depending on the retailer. Kotsur says it can take up to a month to integrate with systems, plus another couple of weeks for retail prep. So it “normally” takes clients between one to two months to go live, although rolling the platform out across all stores can take “between a month and a year” — depending on the number of stores and infrastructure readiness.
Mercaux has more than 15 customers at this stage, across markets including the UK, continental Europe, LatAm and Russia.
Other current customers include the likes of French Connection, United Colors of Benetton, Nike and Under Armour, and it says its platform is being used more than 100,000 times per day in more than 250+ stores around the world.
Fashion remains the company’s largest segment but Kotsur says the platform can operate in any retail vertical that requires “service selling” (or where sales people are expected to have “at least basic product knowledge”), and is looking to grow usage in other verticals.
“Currently we work with Apparel & Fashion, Sports, Department stores, Cosmetics, and even Alcohol segments,” she says, adding: “We are planning to expand to Home & Furniture as well as Electronics over the next few months.”
The Series A funding will be used to drive growth in existing and new markets, as well as being put into R&D to further develop the platform.
On the competition front, Kotsur names Canada based Tulip Retail and US PredictSpring as also addressing similar challenges around digital transformation but she suggests a modular approach and attention to analytics is helping it stand out.
“Mercaux approach is different as not only our in-store solution is modular and easily configurable, which means faster integration and more flexibility for our clients, but we also provide a powerful tool for Head Office teams that allows them to get in-store analytics, control stores performance and execution, and allows real-time connection between stores and retail management teams.”
Commenting on the funding in a statement, Carles Ferrer, Nauta Capital’s London-based general partner — who now joins Mercaux’s board — added: “We have been fans of Olga and Mercaux over the past years, as they have achieved a fantastic commercial traction by tackling a large industry in need of a transformative digital disruption. Within our broader software approach, we have developed a very strong thesis around the massive transformation the retail industry is currently facing.
“Having led several deals within this space — both in the offline retail tech market and in the online-enabled technology retail vertical — we are building another fundamental block that supports our broader view of the space with Olga and Mercaux’s value proposition.”