Vesternet.com - Merchant Interview

Author

Željko Prša

12 minutes read

What you are about to read is my first attempt at an interview with our customer Dave Bell, owner of vesternet.com "home automation" e-commerce site. The aim was to get an insight into the life and challenges that go with being an online merchant.

We talk about how the site evolved and plans for the future. If you are an online merchant or just starting hope you'll find some valuable information here.

Could you please introduce yourself, and let our viewers know who you are, and what Vesternet.com is all about in your own words?

I'm Dave Bell founder of Vesternet.com. Vesternet is Europe's, possibly the world's, best online store for smart home automation.

Smart home automation, for those who don't know, is all about controlling things like heating, security, lighting, energy management, all from a smartphone, or on the web, remotely. You can do things like automate your heating for when you arrive home from work, make your home more secure etc.

We sell all the components which make this work. The thing that makes a difference is that we're not quite a normal online store in a traditional sense, in that we don't just sell boxes. And we are not quite a home automation company in the traditional sense, which is someone coming to your home to install this stuff. We sit right in the middle in between an installer and a pure online shop, and we're quite different in that you can buy the products from us, but then we also give you help and support by videos, and online guides, and all kinds of long-term technical support to let do it yourself and install it in your own home.

That's what make us different, and that's why we are growing rapidly. We are doubling in sales each year at the moment.

Great start. Which brings us to my next question. How did you enter this particular market, was it just a passion, business, or both?

I always had a passion for business. This is, I think, probably my fifth company. And I've always run technology companies and a few e-commerce businesses in the past, too. But this came along, just good timing.

I've always seen home automation beginning to emerge, and maybe six, seven years ago I thought now is the right time just to run a store.

So, I launched it knowing it would happen as a hobby, as a side project to another business I was running, and it just grew from there, month by month. The first few years it did almost nothing. It was just literally a few sales here or there. And then, probably about four or five years ago, it really began to take off.

Now, about the important part, running your e-commerce site. Delivering all the products, service, working knowledge base, and the support is crucial for your business.

When you were starting, how did you come to choose the actual software for the business, like Magento you are using now?

We got to Magento in a roundabout way. Vesternet started, and I still have some of the screenshots from the very first version, which was years and years ago.

It's crazy how far it's changed, or how much has changed.

The very first version of Vesternet was just a custom build store done by a friend of mine, and it was just from the ground up. Every aspect was just custom code.

And it worked fine when we weren't selling much, but then pretty quickly, as it expanded, we needed to make changes.

Moved to a platform called NetSuite, which didn't work too well. That was mainly because it was business intelligence software with an e-commerce module bolted onto the side. And it was very hard to develop with, because you needed a NetSuite developer, which are few and far between. We went with that for some time, and it didn't work well. We then moved to another platform, called Brightpearl, which is a back-end management system, so it does finance, accounts, order processing, stock management. All the back-end processing of a business like ours is run on Brightpearl. And actually at the start, that too had an e-commerce module. We had our website running on a Brightpearl module for the start, too. And the same thing happened, it became out of date pretty quickly.

We couldn't do any of the things that we do now. So, in 2012, Brightpearl, I admit it wasn't quite through my wanting, they decided to stop trying to do everything on the one platform and instead just focus on the backend tools and then integrate with their party systems.

They launched an Amazon connector and an eBay connector and a Magento connector, and they encouraged customers like us to move to a platform like Magento to do their website side.

I argued with them a lot at the start, because I'd just seen it as another thing we had to develop from scratch and I wasn't happy, admittedly, but I didn't quite know what it involved. But anyway, they stopped developing or stopped supporting their web module, and so we moved on to Magento. And it was a huge decision, and I'm so glad that we did it, because, as I say, we could never have done anything like we do now with the previous module. And now we effectively treat Magento as a channel.

We don't have an eBay store or an Amazon store, because we like it to be from our site only.

But if we did, we would basically have several different channels pulling in sales into Brightpearl. So, we just treat Magento now as a pure sales channel. But with that, it has all the benefits of being able to do anything that we want frontend, which could never happen on a platform like Brightpearl.

When this happened I'd just seen it as an extra cost, I didn't realize the benefits of moving to something like Magento, but clearly now, obviously, the good thing about Magento is there's so many different possibilities. Anything we need to integrate with or any other tool that we use, everybody has a way in to work with Magento. So, I'm glad that we did it.

The first way we did it was we just hired an independent Magento developer to create the first version for us.

Just to get you going, right?

Yeah, just to get us started, and then it lasted for maybe a year. And then, he couldn't keep up with our growth. I think he was just a consultant, couldn't commit much time.

We'd then been through, I think, four different development companies.

We then moved to another company that were more Magento specialists, but then they could only commit to giving it like a day, or a month of development, and that was fine for a while. And then I quickly realized that we were moving at such a pace that every pound I spent on Magento development was paying back. Almost every change that we made was working out!

And then, in a roundabout way, we had to leave them in the end, and eventually we came to you. And, yeah, I've said to you before, you guys are the best Magento developers we've had. So, yeah, we now feel stable. We have a proper company that we can work with, but, yeah, it's been quite a journey to get to this stage.

What about the Vesternet team that makes all this happen?

We have just one full-time team just doing stock management, ordering from suppliers. Product management, in as much as adding things to the site, adding a few hundred products per month at the moment, it's growing rapidly. And then we have a dedicated sales team, and then we have tech support, which is a whole different area. We have just people who answer tickets every day. We give lifetime tech support to anyone who buys from us.

You can come and ask in five years' time if something isn't working, and we'll help you with it. It's one of our big value-adds.

But we've committed to doing this properly. We have dedicated teams in every area. And only now are we finding our feet in how these things work day-to-day. It's a big process, it's a big task to have new suppliers coming on board.

Knowing what stock they have, knowing how to keep the website updated. It's a full-time thing, and as well as that, I'm the one adding new things all the time, as you well know, Jake, we're always having discussions about new features which kind of come from me. So anything front end, I plan and want to do. But then we have a whole team behind that who have to keep up and run the whole thing as it's growing. But yeah, it's tough.

It's really all the investment we've made in the operations over the past few years is now paying off.

What is your roadmap as far as you can see right now?

Everything we invested in it is working out, and we have a, as you know, a nice roadmap of new ideas which are in development now, none of which I want to announce yet.

However, we do have lots of cool things happening, and it keeps us so far ahead of anyone else in this space. So, yeah, I can see it getting better. We are seeing month-on-month increases. I think last month was our record month, which is big. We have lots of more suppliers coming on board. The market's growing in general.

So that's one aspect, is the market is really happening. But then the other side is that we're doing a very good job as well. So, we're not just sitting back and waiting for things to happen, but we're actively making it easier for people to buy things online.

We're learning daily through analytics and how people buy this technology, about their buying habits, and we're putting in place all these changes to push it along too.

Those two things in combination are really what's pushing it ahead. And as far as the technology is concerned, I think you'll see... Even in the past year we've seen kits, and brands, and people trying to launch things that haven't worked quite well, and they've just thought, "We'll launch it. We'll get into smart home automation, and it'll be easy." But we see things even now starting and then dying off because they're just not good enough. And similarly, I don't think there will be any one player that comes out. You've seen lots of big brand names come and launch home automation systems, and nobody's taken over.

Nobody's saying, "We own the whole market." I don't think that will happen. I think you'll see lots of disparate, different brands working side by side, all with different propositions, user interfaces, different offerings. And then the customer always decides. That's why we're not backing one, we sell everything. There's a different offering for every different customer.

I think you will see technologies begin to play better together. So you have lots of different competing technologies now. I think you'll see more systems which have encompassed those technologies in one box and will begin to make things a bit easier.

But you will still see different boxes out there with different offerings. And we sit in the middle. We just say, "Here's this controller, or this device. You make your own mind up. Here's the pros and the cons." We just let customers test and review, and we either go to vesternet.com, there you'll see plenty of reviews from customers, and questions and answers, and we just let customers decide for themselves.

Finally, what would be a key takeaway for our readers out there?

My words of wisdom would be that you need to be about more than just those things as well, because they're kind of a given now. If all you're gonna do is launch an e-commerce store and think, "I'm just going to be the cheapest," then I don't think it's gonna last very long, 'cause anyone can just drop the prices, and it's no way to run a business.

My biggest tip would be, don't just launch a shop and think, "I'm gonna be cheapest," because anyone can do that. You need to have a lot more about you than just those two things. If you do that and it's in a nice niche, which is again, the other part of it. I mentioned early on, lots of other shops now are thinking, "We'll just sell smart homes," and that's fine. You can try that, but it's tough unless you know the products inside out. I think, pick a niche, and this is our niche. We don't deviate from anything else. We don't sell TVs, unless they have a smart element to them. We're all about just smart homes, home automation.

I think, pick a niche, and be more than just about pricing, definitely.

It’s all about providing value a value that is above the price, and the customer experience which is actually the biggest part. Everything else, it can work out, it can change, but if your customer experience is bad, then nothing can help you, not even the lowest price in the whole world, isn't it?

Yeah, 'cause people find out pretty quickly now. We have a few thousand now really good reviews, you can easily see. We're a Google certified shop and we're on Trustpilot, as well. You can see we have thousands of good reviews, and they're all pretty much five star. It's all about excellent service. You get found out pretty quickly online, because it's so easy to just to go and buy from somebody else. And if all you're gonna do is pick the cheapest price, yeah, I always say you can probably buy the products that we sell for 50 pence cheaper, or a pound cheaper elsewhere, but then it's what you get for that. You go and buy it off of somebody else, and then try and ask them a day later how it works, or you have a problem, how do you fix it?

Then you're gonna get no reply back. We have a dedicated team of people who just do that. They just spend all day answering technical questions. Our prices are great, but we also have it backed up by huge support as well, which is a big thing.

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Author

Željko Prša

Magento consultant

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Based in Osijek, Croatia.

The Croatian Magento Capital.