When a retailer’s reach exceeds the grasp of a commerce platform: the digital transformation journey at Aussie brand Koala

Australia’s favorite mattress and furniture brand Koala is known for embodying an easy-going lifestyle that celebrates our Aussie roots with sustainable and ethical product lines. As of today, Koala can also be known as something entirely different: a leader in CX-first eCommerce — thanks to a MACH-based architecture backed by commercetools. 

When you achieve something great, you’ve got to spread the news. That’s why I joined a session at iMedia Online Retail Summit: Pure Play in the Australian Gold Coast with our digital commerce partner, commercetools, to share Koala’s fantastic story.

You’re probably aware that a koala is a cute animal native to Australia and an internationally famous Aussie symbol. But did you also know that Koala is a household name in digital retail for mattresses and furniture in Down Under? 

When we started in the digital jungle in 2015, we aimed to share the laid-back vibe of the modern Aussie lifestyle with the world — we reckoned there was no better way to achieve this than by selling mattresses! We went above and beyond to provide more than just comfort and good looks, but also ethical and sustainable products. We slashed down harmful practices, such as overpricing, showrooms and fast furniture. And we've supercharged growth ever since: we bolstered our bedroom and furniture range, and expanded into hard-to-crack markets like Japan and South Korea. 

But that’s just half the success story at Koala. In the background, our eCommerce engine has undergone waves of digital transformation over the years — and this is the little-known side of Koala’s story I want to share with you.

Like many start-ups looking for a share of online retail, Koala’s first inroads into eCommerce involved a “shop-in-a-box” platform. You may know it as an off-the-shelf or SaaS suite that acts as a commerce engine tightly coupled with the frontend. Every classic feature is available, which makes it quick and easy to get your shop online. 

We had a great time with our provider for years, but noticed that we were limited in what we wanted to do by what that platform could do. At some point, we wanted to go somewhere they weren’t thinking of; beyond how they conceptualised and built the platform. 

It reminds me of a line by the poet Robert Browning, “A man’s reach should exceed his grasp,” which is about pushing the boundaries or trying to achieve what’s considered impossible. And sometimes, as a retailer, your reach will exceed the grasp of your platform. 

So, you ask yourself, what happens if your brand grows faster than the box does? Or if it grows in a different shape than the box does?  

First, you ignore the things you can’t do. However, the list of what is out of your reach keeps growing and you wonder about the paths not travelled, the opportunities not taken and the money not made. And you think: that’s not good enough. There must be another solution.  

Two years after Koala’s inception, we replaced the shop-in-a-box storefront with a headless custom-built website, controlled in-house. We could tackle issues such as page load speed to increase sales conversions for the first time. The time-to-market was fast; we were eager to remove the constraints faced with the boxy suite, except for the checkout functionality, which we kept untouched. 

The following years brought massive growth for Koala. We expanded from five mattresses to 371 product variants from 2017 to 2021 and from one single category to 13, and planted our flag in Japan, one of the most complex markets to break into in APAC. But all the work we put into our in-house headless platform started to show cracks. 

We couldn't yet control parts of the customer experience without hacking it to bits. The CMS was bolted on as an afterthought, which resulted in technical staff getting in the mix to update content or layout changes online. The checkout capability inherited by the shop-in-a-box limited customisations, preventing us from offering premium services. 

Our logistics team had wonderful ideas about the ‘extra offers’ experience, such as assembling services. To make that happen on checkout, data has to be consulted by the website; for example, if the shopper is in a supported region and if the service provider is available that day. This requires data translation and aggregation on the website — and that’s hard to get with a vanilla, horizontal checkout experience by an off-the-shelf platform. 

Clearly, we needed to be in charge of the CX, no matter how the shopper interacted with Koala. In short, we were thinking about the MACH philosophy, even though we didn’t know yet of its existence. That’s when we came across commercetools — and started to take a fresh view of everything. 

In 2020, we built a new web solution from the ground up, following the principles of MACH (Microservices-based, API-first, Cloud-native and Headless). That way, we’d have a single commerce foundation for all Koala sites operating in different countries and sub-brands. 

We ran an RFP process and commercetools was the clear winner as the only commerce engine that fulfilled the MACH vision we wanted to benefit from. Having that truly decoupled tech stack means we weren't fighting the commerce backend when designing our website or any other frontend. With the commercetools solution, we can shape the CX as often as we want without any impact on the commerce engine, giving us freedom and control over the customer journey. 

After all, if you’re in charge of eCommerce for a retailer, the customer experience is the thing you can control. You can’t control your competitors, input prices like your container or fuel costs, or how the customers are browsing. But you can consider all these things and craft the best customer experience possible. To do that, you need the flexibility to contract, expand and even replace functions every step of the purchase process without dependencies, instead of being tied to a spaghetti-like architecture that makes you stuck where you are.

When you’re in charge of choosing the best-fit components for your CX — web, payments, CMS, analytics and commerce — and have control over how to glue all of these components together, you’re in the best position to shape and tailor customer journeys on the fly. That’s what MACH does. That’s what commercetools is best at.

So, what do these buzzwords mean about Koala’s growth? Since migrating to commercetools, we’ve been in charge of every aspect of the customer experience, which translates into phenomenal numbers. We grew from 371 product variants to 674 and boosted from 13 categories to 29 in less than a year. We even expanded into South Korea! Our time-to-market powered by MACH is off the charts and ideal for a growing company like Koala. 

There’s more to it than numbers, of course. With MACH as the underlying architecture at Koala, we’ve been able to shift the mindset on how we deal with change. If we develop a function today and discontinue it in two years, it’s not the end of the world. It’s that fast-moving mentality, the everlasting impact of MACH for Koala — and the foundation we as a retailer need to stay ahead of the game. 

Watch Andrew’s testimonial about headless commerce and commercetools here.