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Rakuten Buys Virtual Sizing Start-Up Fits.Me in Personalization Push

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Japanese e-commerce giant Rakuten has added London-based Fits.me, a software start-up focused on building virtual fitting rooms and offering fit advice, to its investment portfolio.

As part of the acquisition announced Monday, Fits.me will continue to operate as a standalone business within Rakuten.

“Fits.me represents both the fun and functionality of shopping online and is a natural complement to our growing portfolio of e-commerce and marketing services,” Rakuten founder and CEO Hiroshi Mikitani said in a statement. “Not only does the virtual fitting room provide customers with a more realistic shopping experience, it also empowers merchants with the valuable data they need to continually improve their service.”

The purchase price was not disclosed but as the Financial Times pointed out, Fits.me has raised more than 16 million euros (about $17.6 million) since it was founded in 2010 in Estonia to help demystify online shopping by creating avatars based on a consumer’s exact measurements, or on his or her height, weight, gender and body shape. Current clients include Henri Lloyd, Thomas Pink, QVC and Hugo Boss, all of which have reported an increase in conversions from first-time buyers who use the virtual fitting room.

Speaking to Sourcing Journal in March, Fits.me CEO James Gambrell summed up the company’s modus operandi as “to overcome the inability of consumers to interact with garments before they buy them online.”

Rakuten, Japan’s answer to Amazon, has been on a spending spree ever since it launched a $100 million global investment fund last year, including August’s purchase of e-commerce app Slice and cash-back shopping site Ebates the following month. It officially launched stateside last October.

Gambrell, who will stay on as chief executive through the transition, commented, “Rakuten built its business by empowering merchants and brands to deliver authentic and engaging shopping experiences, which is exactly the vision of Fits.me. Many fashion retailers are still using basic segmentation techniques, but our fit preference insights help them deliver genuine personalization, which improves customer loyalty and lifetime value.”

Rakuten isn’t the first Asian e-commerce company to acquire a virtual sizing start-up: India’s biggest fashion e-tailer, Myntra, picked up San Francisco-based Fitiquette in April 2013.

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