1.5 million South Africans subscribe to OneDayOnly’s daily newsletter. The deal site’s app has been downloaded 256 000 times. And 550 000 people follow the brand’s Facebook page. Here’s how OneDayOnly grew from selling a single Weber braai, to becoming SA’s biggest daily deals site.
Like many entrepreneurs, when Chris Oberhofer and Maurits Vermeulen launched OneDayOnly
, a daily deals site, it was because they were looking for something that wasn’t available.
They found that they were often searching for products in South Africa that they could only buy through online international deal sites, and they realised two things. First, they wanted the ability to shop online instead of always needing to physically go to a store, and second, online deal sites were awesome – and there wasn’t anything like them in South Africa.
“They wanted to launch South Africa’s first daily deals site, but it turned out to be a lot more complicated than they thought it would be,” explains Laurian Venter, one of the start-up’s first hires and director of the business.
It was 2010. Ecommerce in South Africa was still in its infancy. The challenge wasn’t shoppers though – it was the brands. “They needed to convince local businesses to list on an online site and offer a great deal that would only be available for a limited time frame. It was a completely foreign concept, and it took a lot of educating the market and working closely with brands before they would agree to it,” explains Venter.
The very first product that appeared on OneDayOnly was a Weber braai. “A doctor in Johannesburg found it and bought it, and just like that, Chris and Maurits thought, ‘that’s it, we have a business.’”
And two years later, they did. “By the time I joined two years later, the site had a following, but it was still difficult to get brands on board,” says Venter.
“The point of a daily deal site is that you deliver instant gratification to shoppers, but you also create a sense of urgency and fear of missing out. It’s a fun shopping experience. But you also need to convince brands to take a chance on you and offer a great deal, and that took time. We needed to build up trust, nurture relationships and prove that our model worked. We built this business one supplier at a time, leveraging the brands we already worked with to get other businesses interested and slowly we gained traction.”
On boarding brands was only one side of the business model, however. What interested brands was how many people visited the site, and so a smart marketing strategy was needed to get millions of South Africans interested in a brand new concept – daily online deals. From start-up to scale-up
“It’s much easier to get suppliers on board when 1.5 million people receive your email each day, and you have 550 000 followers on Facebook,” says Venter. “In many ways, we’re a marketing company that sells products. We have huge market prominence, and we place each brand we work with into the millions of email inboxes that subscribe to us each day.
“But to get that right, we had to build our incredible database, and that took fun, quirky marketing and great deals – it was a constant balancing act. We had a great writer who really gave our customers a reason to open our emails, and we did a lot of marketing on our end to build up our database.”
The initial business model (and sales pitch to brands) was to use OneDayOnly for overruns. “We became an additional sales channel for stock that hadn’t moved. And then we realised that we were always running out of stock halfway through the day. The products we had listed were all sold out and there was no more business to do.”
To address the situation, Venter and her team of buyers began working with suppliers in advance. “Instead of asking them for overruns, we started pitching OneDayOnly as a sales channel that could boost the volumes of their sales. At the end of the day, we’re a volume driven business. We work with our suppliers to move large volumes at great prices for our customers. Once we got this right, it changed the business, because we became a key component of our suppliers’ sales and marketing strategies.” Finding a differentiator that competitors can’t duplicate
Quirky marketing that was attracting thousands, then hundreds of thousands and finally millions of South Africans is all fine and well – as is suppliers who were now fully on board – but at the end of the day, OneDayOnly works because of extremely sophisticated website development and management, and streamline operations.
“When we launched, we understood that there were two components to the business model – suppliers and customers. As we grew, we realised that the success of this business – and our key competitive advantage – would come down to the fact that we wipe the slate clean at midnight every night, and start again. The investment in time, processes and organic growth funding is extremely difficult to imitate, if not impossible.”
Here’s how it works. Venter’s team of buyers work extremely closely with their clients. It’s important to know exactly which products will be listed, what the deal will be, how many items are available and to ensure that beautiful images are taken of each product and all the necessary information is available for customers to review. Venter likens her team of buyers to traders on the floor of the New York Exchange, with multiple balls in the air.
The product is then uploaded onto the OneDayOnly site where it will remain listed for exactly 24 hours. Newsletters are sent out and products are listed on Facebook. Customers can purchase throughout the day as a clock ticks away the hours until the deals are over. At midnight, the site is wiped clean and the next day’s deals are loaded – and this happens every single day of the year, for up to 300 products per day. Getting it right, capturing (and delivering) orders and ensuring the site doesn’t break with millions of people on it takes a finely tuned machine to accomplish, which is why the operations side of the business is so critical.
“Without the ability to deliver, the business would never have worked, or grown to where we are today,” says Venter. “Getting here has been a journey of continuous iterations. We’ve gone from one deal per day to 300, which required the entire site to be redeveloped. We’ve grown from one outsourced developer to a team of 25 in-house developers, so beyond being a marketing and sales business, we’re a technology company as well.”
The operational and warehousing aspect of the business has also grown to play a critical role in the business’s growth and development. “If we can’t collect, package and deliver goods, we don’t have a business. Our operational manager is responsible for incredible volumes each day. It takes all of this working together to make the whole work.”
Throughout the growth journey, the focus has remained the same: “We are always asking ourselves how we can make this bigger. What’s the next step,” says Venter. “For example, we launched an app to reach a wider audience and to improve our customers’ experience and their ability to access our deals in the simplest way possible. The uptake was extremely positive – 256 000 downloads to date. It’s important to never rest on your laurels, and to always stay ahead of what your customers want.
We realised early on that our success is built on the volume of sales we can achieve, and so that remains our focus point. Every innovation is designed to support this key goal.” Building a game-changer
The business is entirely self-funded based on organic growth, but that doesn’t mean the team hasn’t stumbled and fallen along the way.
“We’ve made so many mistakes, some larger than others,” says Venter. “But we’ve always gotten back up and tried again. When you move as quickly as we do, there will be errors. The culture of our company allows for that. We invest in the best and the brightest, so we make sure that we have top talent, but we also allow for mistakes. If we don’t take risks, we won’t see rewards.” LESSONS LEARNT Invest in your people.
This was a shift for our business. As soon as we could, we started investing in top talent and it was a game changer. This is a high-paced, detail orientated business. It requires great people to make it work every day. Train. Train. Train.
Top talent doesn’t necessarily mean most experienced, however. We hire talented youngsters who have incredible attitudes and then we train them up. They learn our systems, processes and culture from the ground up. They don’t have bad habits that need to be broken – just highly educated, fresh minds that are eager to learn and seize each day. Hire for the gap you’re filling, not a role.
We’ve needed to create many roles in this business because we recognised we had a gap, and we could figure out what type of skill was required to solve it, but it wasn’t necessarily a ‘traditional’ role that we needed to fill. We’ve always built our team to fit the business, rather than made the business fit the team we have. What’s the business problem? What’s the need? How do we fill that gap? Focus on leadership to scale.
This year we’ll be focusing on achieving our next level of scale, and to do that we need to increase the capacity of our people. You can’t expect a manager to go from managing a team of three to 15 without the necessary skills set and toolkit at their disposal. Leadership training is therefore a critical focus area. If you fall, get back up again.
Entrepreneurship is tough. You will make mistakes, which is why resilience is absolutely key in any industry that’s new. When you’re a pioneer, you’re figuring things out, and you won’t always get it right – but if you don’t carry on after a mistake, you’ll never reach your ‘next’.