Working Mother Applies Science to Online Toy Business

Kelly Brough is no stranger to the internet world. She worked for 10 years in AOL and Lonely Planet, the travel-guide firm. Nonetheless, this high-powered working mum, with degrees in engineering and science, — and an M.B.A. from Harvard — found it surprisingly difficult to find fun, attractive and special children’s toys online. This led her to launch a toy site, Oola.com.au, in Melbourne, Australia.

“As a fulltime working mother, I struggled to find the opportunity to discover fantastic toys. The top products were sold in little bricks-and-mortar boutiques. I’ve always loved toys and games, and can do puzzles, build things or play games all day long! Unfortunately, among the hardest parts about being a working mother is that you can not do as much with your children as somebody who’s not working or functioning part-time.”

After Brough abandoned Lonely Planet in December 2010, and had taken some time off to spend with her loved ones, her husband Andrew encouraged her to start her own company.

Equipped with only $25,000 AUD, Brough was decided to launch her toy site before the 2011 holiday buying season. From beginning preparations in August, she started Oola.com.au on October 31 — in time for Christmas. The site received over 1,000 visitors in its first month and achieved a conversion rate of over 4%.

Oola’s increase in sales, conversions and traffic continue to rise.

“Since January 2012, Oola has attained 77 percent compound monthly sales increase, 30 percent monthly increase in conversion speed, and a 30 percent compound monthly increase in traffic,” she says.

Brough says Oola is on track to break even by 2012 year-end, after the holiday sales period, and expects her company will recover the initial investment of $25,000 AUD. She expects to quadruple earnings in its second year, yielding the site’s first profit.

“Oola.com.au sells the sort of trendy, fun toys-that-teach, which promote open-ended play that are generally found in local boutiques. As we have grown, we have discovered that households want ongoing suggestions to make playtime at home fresh, fun and intriguing. Oola has become the most recommended destination for play-based activities to entertain young children. Our product offering is now being expanded to deliver on this vision.”

Shopping Carts

Among the projects Brough directed at Lonely Planet was a complete rebuild of its online store.

“I was already familiar with lots of the marketplace’s scalable suppliers, having thoroughly reviewed their offerings. I looked at a couple software-as-a-service providers because I did not want to do my own hosting before I built up a sizeable company.”

Brough intended to use one specific supplier but became worried after a lengthy gap in communication. Prior to this, she’d read about Shopify on some tech sites.

“I did not believe Shopify seriously since it was established in North America. But I analyzed their 30-day free trial while I was waiting to hear back from my chosen provider. I was hooked with the ease of use and super-helpful customer support. In a few days I was ready to examine transactions, which could have been earlier except that I had been awaiting bank approval in my merchant account. Fundamentally, Shopify has what we want: a secure shopping cart with best practice checkout stream, best-of-breed user experience design and navigation, flexible design options, a clean, modern user interface, and robust customization possible via APIs.”

Brough stated Shopify also reassured Oola it might attain the tight time frame with no external dependencies for hosted cart installation or layout.

“Their APIs enable us to add features as our company develops, and the SaaS model means we pay only for what we use every month, avoiding costly growth before launching. Plus they provide exceptional customer service. The fire for their platform comes through as they work hard to help shop owners like me, find solutions to our targets.”

Credit Card Payments

“I’ve worked with internet payments since 2001 when I was at AOL handling business-to-consumer businesses. I knew we needed to have an extremely secure and dependable payment gateway which would stay on top of each the market security improvements like the PCI DSS. We were also thrilled to find local supplier eWay that could satisfy our needs in a comprehensive way.”

Order Management

“Shopify includes order management capabilities as part of its applications. There have been few things that I’ve had to change, which makes this element of building an internet retail company a non-issue.”

Hosting

“With a SaaS model for the own shopping cart, Oola is based on Shopify for hosting”

Employees

“We are just searching for our first employee, in advertising. Ideally, I want to get another mother who needs a flexible, part-time function. Because I am located at home, I want somebody who could work from her house, but co-work with me one day per week. I found a local freelance designer at a local media event who knows the Oola style. She works to my budget; we summarize what has to be done weekly. It takes longer that way, but enables me to manage cash flow effectively.”

Brough tried using offshore designers, but prefers to discuss prerequisites and aims with the designer in person to get the best outcome.

“I wasn’t particularly pleased with the offshore designers whom I hired. But I use oDesk [a website to help find contract services] for most of my technical work and recently caused a virtual assistant who’s far more than an assistant.”

Oola offers fun toys which are also educational.

Search Engine Optimization

Brough says it takes time to develop the links, content and credibility that will offer a page-one natural search result.

“At Oola, we’ve got a content marketing strategy with its origins in our search engine optimization goals. We’re already regularly guest blogging on two parent-focused websites: Connect2mums, and Infants & Toddlers Directory. Over time, we’ll increase our regular contributions and one-off guest posts.”

Shipping

Brough says shipping has caused her the most heartache.

Logistics in Australia isn’t very well developed. Costs are high, service standards are low, and flexibility to fulfill customer needs is virtually non-existent”

Brough admits that at first, she knew nothing about fulfillment because she was not involved in the supply of Lonely Planet’s physical product. She soon discovered the challenge from having toys come in many shapes, sizes and weights.

“This becomes the hardest issue to plan because our clients all choose different products. Initially, I focused on cost because from a new standpoint, I wanted to offer flat rate shipping across Australia, to make it easier for men and women who reside in the country to get online shopping. Additionally, I believed that $10 was too much, and still do. I’ll generally abandon my shopping cart once I see a $10 shipping fee.”

Brough chose a neighborhood, low-cost courier, and relied on Australia Post for the remainder. However, the courier failed to deliver what was contained in its sales pitch.

“So I had to use a mixture of suppliers to minimize unit cost of delivery and started a business account with Australia Post and began to use its online’Click and Send’ procedure. However, because our order volumes grew, we spent precious time choosing the ideal packaging to fulfill the different suppliers’ requirements.”

She also considered outsourcing satisfaction, knowing that Oola needed to maintain adequate orders to receive reduced shipping prices. But she doubted this could offer the level of customer service tantamount to her brand.

“To make things harder, the Send and Click applications on the counter of my neighborhood post office, where I lodged my parcels, didn’t work with a company account. It had been heartache all around.

“I have simplified my shipping practices today and ship everything via an Australia Post satchel. I’ve just begun to use Australia Post’s eParcel service, which will further simplify my procedures and save precious time and money.”

Product Sourcing

Brough says choosing products is undoubtedly the most enjoyable and exciting part of Oola.

“We seek toys which are stylish, high quality, and have enduring value to permit children to discover and develop play. We source our goods from all over the world, but buy them through local suppliers.”

She started to choose products for Oola by asking her friends to offer feedback on the toys they liked.

“In the San Jose Museum of Tech Innovation [from the U.S.]I spent plenty of time taking notes on brands which provided quite interesting science and engineering toys I had not seen in Australia. Some of these I have managed to find locally and others are on my list for when I am ready to handle my own direct importing.”

Oola now carries 250 SKUs from 22 brands. It’s expanding its product range rapidly, having quadrupled the SKU count because the launching just six months ago.

Inventory Management

Brough says while Shopify monitors units in stock, it doesn’t provide additional insights or reporting.

“I export my earnings data and handle this manually through spreadsheets. Shopify has a strong app store with several add-ons to its core CMS, including stock management. I can still manage things manually for a short time . I, however, will want to have installed and tested better before the Christmas rush. We’ll soon have sufficient inventory to require a stronger solution and will start researching this area. Fortunately, there are quite a few applications in the Shopify’s app shop to deal with this.”

Accounting Software

“We do not use accounting software. The purchase records available via Shopify provide everything we want on the sales side and our cost items are manageable through careful manual bookkeeping.”

Social Media

“Oola has dabbled in social networking within the last 3 months. We’re busy on Facebook and Twitter, yet find social media helps us keep contact with our network between earnings, instead of drives new customers to Oola. We’re experimenting with photography and inspiration, and look forward to building a community around issues affecting busy households that juggle family, work and lifestyle commitments.

“Because we’re in a enormous customer acquisition phase of our expansion — being just six months old — we concentrate on direct channels such as email advertising, comparison shopping, and paid search advertising.”

Customer Service

Oola offers free gift wrapping and low flat rate shipping Australia-wide, and free delivery for all orders over $50.

“We work hard to provide as much value to our clients as possible. If a client call goes to voicemail, I respond within one hour. If they email, I respond as soon as I get it. This may be at all hours of the day and night, though I do place my mails off for family time.”

Brough obtained an order from a client who lived in the same area as her mother-in-law, in Adelaide, 726 km — 451 miles — from Melbourne.

“Coincidentally, we were driving there the next day so I packed up the goods and took them into the customer myself. The order certainly wouldn’t have arrived that quickly by any other means.

“We have also had clients email us searching for a particular crossword puzzle, and specific games that they have not found in local shops. We have tracked down those and added the products to our range. We love the feeling of making people happy!”

Biggest Mistakes

Brough says choosing a courier which had cheap shipping prices, but an inflexible reservation system, has been Oola’s biggest mistake so far.

“The sales staff advised us that pickups could be organized at any time, with two daily runs throughout the region. However, it was calls to collect a product needed to be put between 8:30 to 9:00 a.m. Before 8:30 a.m. there was no answer. After 9:00 a.m., they told you to call again the next morning at the appointed time.”

Biggest Successes

“Google AdWords has been by far our best success. I was initially intimidated by AdWords, realizing that it might eat away my advertising budget. But having worked in electronic media for ten years, I’ve run many AdWords campaigns. I knew from experience what was best practice in this area, so that my efforts began delivering effectively straight away. These campaigns are my main source of conversions plus they offer an attractive return on investment.”