MIC analyst Silvia Chen explains that Taiwan’s online fashion sales market dates back to 2001, when Ya­hoo!Kimo Auctions Taiwan went live. In those early days, sellers would snatch up affordable clothing from stores in Wu­fenpu, part of Tai­pei City’s Song­shan District, and then auction it online, pocketing the difference. Later, as more and more online shopping platforms sprang up, bigger sellers and even actual stores began to expand the online side of their businesses.

The boom in online sales platforms can in part be attributed to aspiring entrepreneurs being able to use those ready-made systems rather than having to worry about building their own sites and dealing with the hassles of updating and administration. On top of this, these platforms offered a safer transaction process for interested buyers, letting them purchase in confidence. They also had their weaknesses, though—the “stores” were all much of a muchness designwise, and sellers had to go along with sitewide sales held for special occasions like Mother’s Day or Christmas. This meant they weren’t entirely free to do whatever they wanted in terms of marketing.

At the same time, the two biggest such platforms—Ya­hoo!Kimo and ­PChome—saw a huge boom in registered sellers, with each new addition making it harder for any one seller to catch attention. Wanting to break free of this environment and attract a customer base all of their own, some of these sellers began looking at starting their own websites and brands.

The pioneer of online fashion sales in Taiwan was lativ, which launched its website in 2007. After branching out from being a textiles company into the world of fashion, lativ’s commitment to affordable fashion and its high-visibility advertising campaign saw it quickly build a name for itself. Since its launch, the site has seen constant year-on-year growth in revenues, reaching an estimated NT$7 billion in 2012.

lativ’s sales success has also breathed new life into the textiles industry, previously considered an industry in its twilight. Look at Jie­qiang Textiles and Ding­shun Enterprises—both were once manufacturers for lativ, and now both run their own online sales operations, named Co­zie and Il­lori respectively. In March 2012, big textile company Ma­ka­lot Industrial, which owns a 40% stake in well-known online clothing seller Go­To­Buy, created their own brand, fisso.

According to Silvia Chen, as customers wanting to purchase clothing online must first log into their site of choice, those sites can easily keep track of demographics and buying habits, enabling them to make better product recommendations and offer styling tips. And by being able to almost instantly adjust their marketing to latch onto the latest online trends, these virtual stores have the edge over brick-and-mortar stores in their fight for visibility and their efforts to engage their customers.

However, as Chen reminds us, with so many businesses built on essentially the same foundations, those in the arena must constantly build added value and freshness into their product lines, lest they be left in the dust behind this pitched battle for dominance.

So who will be the one to follow in lativ’s footsteps? As the market continues to get bigger and more and more people want a piece of the pie, trying to find that sweet spot between fashion and finance will be a hard test for anyone looking to take that title.