Five years ago when Sean Senvirtne, founder of e-commerce marketplace MyDeal, caught up with SmartCompany after being nominated for the Smart50 awards, he stated a bold goal.
He was gunning for MyDeal to hit $300 million per year in sales over the next five years. At the time, MyDeal was on track to hit $30 million in sales for the year.
“I remember chatting with (former SmartCompany journalist) Dominic Powell afterwards and I thought, maybe that number was a little high,” Senvirtne recalls with a chuckle.
Today MyDeal is listed on the Australian Stock Exchange, and in its latest annual report disclosed gross sales of $218.1 million. Senvirtne says MyDeal booked $70 million in sales for the most recent quarter, putting the company on track to hit that $300 million sales goal in the not too distant future.
“So it is quite remarkable that we are actually there,” he says.
“Sometimes people are too scared to make these big, hairy, audacious calls. Building a business is a journey, there are a lot of ups and a lot of downs. But the key is to focus on the customer, focus on your people, stay true to your values, and just execute, execute, execute.”
The company’s latest figures show increasing customer loyalty, with 61% of transactions coming from return customers in October 2021, up from 51% in October 2020. Senvirtne puts that success down to one of the organisation’s key values. They like to win on price.
“That’s hard to do. And we do sacrifice our margin in some aspects, to give the customer the real win on price,” he says.
“Because e-commerce is all about value play. If a customer is going to spend $500 or $1000 on a big and bulky item, most of the time they will do their research. And when they do their research, that means you have to be competitive on price.”
However, Senvirtne has a reminder for founders looking to grow customer loyalty. There are no shortcuts. In addition to being competitive on price, he says it can relate to personalising the experience for each shopper, investing in loyalty programs or improving the post transaction experience.
In MyDeal’s case, it could also be the result of the mobile apps it released earlier this year.
The decision to launch those apps was driven by data, and MyDeal continues to examine the differences in the ways customers use MyDeal when browsing on desktop, mobile, or on the apps. That means looking at customer engagement, conversation rates, and time spent browsing or in-app.
“Any organisation or any company that’s trying to operate in 2021 needs to have a heavy focus on data and they need to invest in getting that data to the teams that need it,” he says.
“Marketplaces are able to give you that flywheel effect. You can look at the data, understand the opportunity and bring a seller or products on board that fulfill that demand.”
Senvirtne understands from experience that smaller ecommerce businesses, or those early stage e-commerce startups, will have to make decisions about which metrics to spend the most time dissecting. He says the most important metric for these businesses to focus on is conversion rate. It’s a number that MyDeal looks at every day, and in some cases, every hour.
And conversion rates can be influenced by a variety of factors.
How fast does your website load?
Are your images effective?
Is the content compelling?
Are your prices competitive?
Is your checkout experience effective?
“This is why these days a lot of companies are using A/B testing. Even sometimes changing the colour of the checkout button might have an impact on some people,” Senvirtne says.
“E-commerce is very different to bricks and mortar. When you go to bricks and mortar you can see the customer coming into the shop, browsing, going into the fitting room. But in e-commerce you have to really trust your data, and rely on it to make improvements.”
Another metric to keep a close eye on is bounce rate — the percentage of people who leave your website after visiting a single page.
“You need to have engaging content for people to stay within your website once they land on it. Because you’ll be spending a fortune on marketing to bring visitors onto the website. You want people to stay engaged, and stay browsing. So that comes down to the content, imagery, experience and pricing.”
Personalisation is also important, Senvitne says, because it drives engagement, which in turn, drives conversion.
“We contact our customers in multiple channels, so it’s really really important to know your customer,”he says.
“If your customer has a cat, don’t send them dog food for example. It’s marketing 101. Know your customer.”
It’s MyDeal’s laser sharp focus on the needs of its customers that Senvirtne hopes will carry the business to his next big ambition — lifting sales to $1 billion.
Kye began his career at a Fairfax daily on the North-West Coast of Tasmania. He has since taken his belongings, and keen interest in technology, to Melbourne. He has a bachelor of Arts majoring in Political Science from the University of Tasmania and a Graduate Diploma in Journalism from RMIT University.
