Based out of Oakleigh in Melbourne’s southeast, Klika has been a quiet achiever amongst online retailers. Founded as a home and outdoor goods retailer ten years ago, the business is worth $15 million today, with elder statesmen Ian McLellan, Boris Zaitsev and Scott Gladstone still at the helm.
Klika operates its own dedicated online retail website in tandem with six categorised eBay stores, each with procedurally generated product listings and marketing material. The brand also sells directly out of its Oakleigh showroom and warehouse.
Almost as impressive as the scale of the business, having expanded into fitness, power tools, toys and hardware equipment, is its self-containment; the site’s online channel, e-commerce suite and integration with marketplaces such as eBay has been kept almost entirely in-house, replete with a decade’s worth of additions, improvements and repairs that have cut, polished and sculpted an e-commerce platform that is the envy of a number of larger retailers.
Power Retail was lucky enough to chat with Scott Gladstone recently about the business, its back end, and the trials and tribulations of developing a retail website almost entirely from scratch.
What necessitated the building of a new e-commerce platform from scratch?
When we first started, there was nothing that did the job very well. The service providers available at the time had something based more on the US market, which didn’t really work very well for us; we had eParcel to integrate with, and the providers available didn’t do eParcel, so the listing and invoicing, after-sales, shipping and printing labels simply didn’t happen from anyone, no one offered it as a solution. So, we just made the solution ourselves.
I don’t know if they’re offering it now, but they keep contacting us; they’ll see us on eBay, or advertising through Google AdWords, and they keep coming to us with all these solutions for the business. It’s just too little, too late, and they’re too expensive as well.
What major hurdles did you face in the development of the new platform?
Often we found ourselves developing our own system in readiness for new features our partners were implementing, only to find these new features were delayed; a good example of this was with one of our fulfilment providers and implementing push notifications by email or SMS.
This particular fulfilment company had built their own system quite a while ago, put in the system that they were going to do these push notifications, giving a little specification about it. I saw that and thought ‘Fantastic, we’re gonna have that’, so I built that into our system, ready to go.
Two years later they still hadn’t done it; they finally handed the project off to another company, which completely rewrote their system. Now this new company is looking to do these push notifications, onboard with the driver or with cards, and when they start feeding us that information we’ll be ready for it; we’ve been ready for it for nearly two years!
When the software is in place, how will this system work?
Currently we have a lot of customers ring up asking where their goods are, and we’ll look it up and find they tried to deliver it and they weren’t home. What will happen is in the morning a package will go off with a driver; the customer will get an SMS telling them ‘your goods are in the van, don’t go out’. And even if they do miss the delivery they’ll get an SMS telling them the goods were just carded, so they know they’ve just missed the courier.
As it stands, though, a lot of the time the customer doesn’t know that’s happened; then five days later they’ll be ringing up saying ‘where’s my goods?’ That annoys the customer. And they’ll swear they were home, they just ducked out to pick up the kids. So hopefully the SMS functionality will help us out.
That’s where our biggest push comes from with regard to developing this platform; the customers that just want to know where their parcel is. We all want information quickly.
What advantages did the in-house e-commerce platform provide? Was it worth the effort?
The whole point of keeping it in-house is the simplicity of it. It doesn’t have to be complicated; customers don’t want to go through a complicated process. Our system’s worked really well for us. Even with new staff coming in it’s proven to be quite intuitive to use, as opposed to needing a Yellow Pages sized guide to use the system.
It also minimises the outsourcing of staff in our company. Many other online retailers have customer service staff based in Malaysia or India. When customers call Klika, it’s a real value-add that they can speak to someone within Australia, that understands Australian problems.
It might not be the sexiest system out there, but the functionality and reporting that comes out of it is phenomenal. It’s at the point where other players in the market are approaching us, looking to license the platform to use for themselves.
How does it compare with the commercial alternatives?
There’s not a lot in it, but it does everything we need it to do, whereas if you look at another system, we get a huge system that basically covers the world.
A commercial system could have all the functionality of the world, whether you’re selling something or dropshipping something or renting something or leasing something, their system will cope with it. But if you’re just looking for a system for selling, like we are, all of that is just too much involved in it.
They’ve been out to demonstrate their systems a couple of times, and it’s just so complicated, so much in it that’s useless to us; it’s one system that has to work for every retailer in the world, every carrier, every site that you’d want to sell on and for every type of transaction you want to do, and you’ll pay through the nose for all of it, even if you don’t need it.
What sort of tangible benefits would customers see from systems like this?
One of the big drivers is eBay, where customer feedback is crucial to a business. If we didn’t have that constant fear of bad customer feedback, we wouldn’t do half the things we do.
Klika’s been on eBay for the past ten years, and when we do something wrong our customers give us bad feedback and it gets seen all over the world. So we’ve had to really pick up our game in customer service in the past ten years.
A traditional bricks-and-mortar retailer might come into the market selling stuff on eBay, who think they can use their regular bricks-and-mortar customer service. eBay customers will just tear them a new proverbial. “I ordered this product four days ago! Why hasn’t it arrived yet!?” That might be fair enough for bricks-and-mortar traders, but it’s already put them out of the market on eBay; by comparison if Klika received an order yesterday, it’s got to go out today, simply has to happen.
The expectations between the online customer and the bricks-and-mortar customer are completely different. Every year the expectation of quicker service, faster turnaround, better packaging, it all makes online retail more and more challenging.