Philippe Chainieux, CEO of MADE.COM talked to us about the key moments in the company’s history – its international expansion, the health crisis, the impact of PSD2 and the importance of payments in its growth. Let’s take a closer look at this successful business and its partnership with Dalenys since 2013.
Different payment methods for each country
MADE.COM is an online design furniture and homeware firm founded in London in 2011. It is a digital native vertical brand (DNVB) which designs, sources, transports, and sells its products directly and boasts an innovative business model based on collaboration with independent designers and a technology platform. The brand was an immediate success in the UK and now operates in eight European countries, generating revenues of €500 million.
At first, the company integrated three payment methods (CB, Visa and Mastercard) for its first two countries, France and the UK. In 2014, MADE.COM really took off, expanding its international operations into Belgium, Germany, and the Netherlands and integrating the payment methods used in each country – Bancontact, Giropay, iDeal, Sofort. In 2019, the Buy Now Pay Later concept caught on. This involves offering payment facilities that allow the customer to pay at a later date or in several instalments. MADE.COM integrated instalment payments with Oney.
“With its single API, Dalenys made it easier to integrate all the means of payment we needed to be able to grow,” said Philippe Chainieux.
Working closely with Dalenys through the pandemic
The pandemic completely moved the goal posts for doing business and uncertainty was high.
Ludovic Houri, CEO of Dalenys, explained that “selling furniture online is one of the riskiest parts of our business, because the products are delivered a long time after the order is placed. Many things can happen in the meantime, so there is a big financial risk. This is why close partnerships are so important in this sector.”
The two CEOs set up weekly meetings to keep a close eye on the situation. MADE.COM was very open with Dalenys, explaining its logistics delays, the problems encountered in some countries, and so on. This collaboration sealed the relationship of trust between the two companies.
“It’s the payment service provider that incurs the risk during the period between the order and the delivery. At the start of the health crisis, some payment platforms introduced new terms and conditions, making things difficult for their customers. We were able to talk to our PSP’s CEO directly, and that made all the difference,” said Philippe Chainieux.
New payment rules in 2021 with PSD2
Big changes are taking place in the online retail industry in 2021 as strong customer authentication under the new Payment Services Directive 2 (PSD2) is revolutionising how online payments are made. Strong customer authentication (SCA), which was previously requested by merchants, is now in the hands of the issuing bank (the customer’s bank). SCA adds friction in the customer journey, increasing the risk that the purchase will be abandoned.
MADE.COM implemented the various stages of PSD2 one by one with a gradual migration towards the new security protocol 3DSv2. Tests ensured the migration had the smallest possible impact on acceptance rates.
Under PSD2, cooperation between the issuing bank, the PSP, and the online merchant is vital to optimise the application of SCA. If the merchant manages chargebacks well, the relationship of trust with the issuer makes it easier to accept SCA exemption requests.
2021 has also been a special year for MADE.COM, which completed its IPO in June. “This gave us momentum to grow even more and become a European leader in our sector,” added Philippe Chainieux.
MADE.COM and Dalenys have many more chapters to write in their shared story!