In 2003, long-time friends Zane Zietsman and Ryan Bakos wanted to start a mail order company. Zietsman, who had been in the office automation business, had had enough of the corporate world. Bakos, with years of experience in the furniture retail sector, was ready to try something different. “The idea was to import new and interesting consumer products from overseas,” says Zietsman.
The first product they brought into the country was an audio-visual baby monitor that enables parents to watch and listen to their baby while it sleeps. “We were the first local company to sell this type of monitor and it proved to be a huge success,” Zietsman recalls. “We supplied all the major baby ware retailers.” Both employed, they started moving product as a pure “by night” business which they ran from Bakos’s home in Johannesburg. They also took out advertisements in baby magazines, which led to a spike in individual demand. “We had to find a way for people to place orders and pay by credit card because we could not answer phone calls all day long,” he adds. “The obvious solution was to create a website so that people could shop and pay online, and so eDreams was born.”
Following the uptake of their first product, it made sense for them to expand their offering to an entire range of baby products.
“One of our first challenges was bankrolling the business,” says Bakos. “We were buying products from overseas, which we had to pay for upfront, but the retailers would take anything up to 120 days to pay. Setting up an e-commerce -enabled website helped us to overcome that problem.” Once the website had been established, Zietsman and Bakos agreed that their aim was to sell everything online, and to sell well. There were several infrastructure imperatives: they wanted to set up an attractive one-stop online shopping portal, provide sophisticated functionality, and give shoppers all the information they needed about the various products. They spent 18 months developing the current website before going live and today it is able to handle thousands of orders at any given time. “Anyone can set up an e-commerce-enabled website for a few hundred rand,” says Bakos. “What we wanted was to create a masterpiece. Today it is the only one of its kind that sells just about anything, from appliances and electronics, to sports and outdoor equipment, and the product range continues to expand.”
Their formula is working. eDreams was nominated for six South African e-Commerce Awards in 2006, winning Best Electronics Store, Best Kids & Baby Store, and Best Sports & Outdoor Store. Zietsman says the awards have helped to drive more traffic to the website. But eDreams’ biggest marketing drive has been search engine optimisation. “We designed and created our website so that it would rank high in the search engines and help potential customers to find it easily. Selective magazine advertising, word of mouth, viral campaigns and Facebook have also proved successful,” he adds. eDreams clients range in age from 20 to 45 and represent various Living Standards Measures (LSMs). “We cater for everyone, from parents who want to buy nappies, to people who want to buy a new set of golf clubs,” Bakos says. He attributes some of eDreams’ success to the fact that the company is not a “middleman”. “We carry a huge range of stock and we handle all supplier warranties. Because we function as legitimate retailers, customers know they can buy from us with confidence.”
Dedication to the customer is a top priority. “The website is really easy to navigate and you literally trip over the products you are looking for,” says Zietsman.Turnaround time is anything from 24 hours to seven days, with 80% of orders delivered in two to three days. The partners never took a loan, but they did mortgage their homes. “We suffered in the beginning and we seldom paid ourselves a salary,” says Bakos. “Even now, we continue to plough money back into the company. As our turnover increases, so we increase our staff to ensure that we can fulfil our orders.” Internet access has been a challenge but the decreasing cost of broadband bodes well for eDreams. Zietsman and Bakos say they aim to build the company into the biggest online player in the next five years. It’s not an unrealistic goal, given that the business is experiencing 50% to 100% growth every month.
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