Steffen Daleng on marketing beyond commodities
Steffen Daleng, Chief Marketing Officer at Booktopia sits down with Mark Jones to discuss how to create a frictionless user experience, converting digital laggards and Booktopia’s growth to become the biggest online book store in Australia.
It’s important to be sticky, especially when marketing a commodity. But have you ever considered that the best way to stick in your customers mind is to be frictionless?
For digital-only retailers, crafting seamless and intuitive experiences is an effective way to stand out, keep customers on side, and, in the case of Booktopia, convert digital laggards.
Steffen Daleng, Chief Marketing Officer at Booktopia, has transformed the book retailer on the back of the pandemic that drove us all online.
Steffen explains that though in Australia 13% of retail happens online, that's a significant proportion of the retail wallet that still sits offline. However, with lockdowns and COVID restrictions in place, physical book retailers needed to close, which presented an huge opportunity in the market for Booktopia.
“There was a particular cohort that were particularly resistant to buying online. We're talking about the boomers, the 45, 55 plus that preferred buying in physical stores and really weren't that keen on buying online,” Steffen says. “But when stores were closing down, they didn't have any other choice than buying online.”
According to Steffen, the design of Booktopia’s experience needed to respect and understand the reasons why those customers didn't want to buy online in the first place. He says you need to think strategically about what they desire beyond just the commodity they’re purchasing.
“It's about making sure that you have a full user journey. What are you really considering about everything around how you get the first order? How do you get the customer in the door? But then do you have a plan for how you're going to get the second order, the third order, the fourth order, the fifth order?”
To hear more from Steffen Daleng on the role purpose plays in creating frictionless customer experiences, get comfy and tune in to this week’s episode of The CMO Show -it’s a real page-turner.
Resources
What Booktopia's CMO is doing to ensure brand partnerships flourish - CMO.com.au
Booktopia announces restructure of its marketing team - Mumbrella
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The CMO Show production team
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Audio Engineers – Ed Cheng & Daniel Marr
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[Transcript]
Host: Mark Jones
Guest: Steffen Daleng
Mark Jones:
Have you ever considered that the best way to stick in your customers mind is to be frictionless?
For online retailers, crafting easy and intuitive experiences is an effective way to stand out, keep customers on side, and, in the case of Booktopia, even convert digital laggards.
Providing an experience where consumers slide seamlessly through your sales funnel is a competitive differentiator and the opportunity to change behaviour.
It’s also important to consider the full user journey, and what you’re putting in front of your customers in order to create brand loyalty that’s keeping your customers sticking by your side… or in the case of Booktopia, your brand story is a real page turner.
Mark Jones:
Hello friends! Mark Jones here. Great to have you with us on The CMO Show.
Today on the show we’re talking books! We have a great conversation with Steffen Daleng, chief marketing officer at Booktopia.
Steffen’s had a fantastic journey through the world of eCommerce marketing, from independently selling online in Denmark, to starting an agency in Milan during the global financial crisis, to a production company in Indonesia right through to here in Australia.
We spoke about Booktopia’s growth to become the biggest online book store in Australia, and what marketers can do to get better informed and craft the customer journey.
Steffen also touches on how Booktopia is demonstrating the link between their customers experience, and the Brand’s purpose.
Let’s go to my conversation with Steffen Daleng.
Mark Jones:
Hello, and welcome to the CMO Show. My guest today is Steffen Daleng. He is the CMO at Booktopia. Steffen, great to have you with us.
Steffen Daleng:
Yeah, thanks, Mark. It's great to be here today.
Mark Jones:
I want to start right back at the beginning of your story, and I understand that you began your online journey in e-commerce, selling your girlfriend's used jewellery in online marketplaces in 2005. Tell me about that. What was going on then?
Steffen Daleng:
Maybe I should start by saying she knew about it, but yeah, I did. The first fore that I had into e-commerce really came from me being, I was working as a sergeant back then, and I was working in the compound as a sergeant. And then you have recruits that's, everybody's sitting around and checking IDs and making sure that people who come in and out of the compounds actually were allowed to be there. That's it, you sit there for 24 hours straight over a weekend, and that's the boring nature of that role and that job in that capacity. And I was literally withering away in that kind of job and just needed something to do. And I think it was more out of boredom that I tried selling some of my partner's used jewellery on a marketplace. Because we talked about it and I said, "Why don't we try and sell some of that if you're not using it anymore?"
Mark Jones:
And just to jump in, we're talking about the Danish army here, right?
Steffen Daleng:
Yes, we're talking about it.
Mark Jones:
It's worthwhile geographically locating you too.
Steffen Daleng:
True, true, true. Yeah, this is the Danish army in logistics back in 2005 or so. But yes, she knew about it and really just wanted to get rid of some of her used jewellery. And I suggested I could try and sell someone one of the marketplaces back then in Denmark. And that was probably the start for myself in e-commerce. That first sale, selling that first product, and I was immediately hooked. I knew in that moment that this was it for me, I had to do this. It was almost like a gamified element of success where there was something accelerating and extremely fun about achieving that sale in that moment. And so it kept going. She kept providing me with some used jewellery and I kept then getting new inventory in by then starting to buy wholesale jewellery.
Steffen Daleng:
And I guess the short story of it really is that from selling that first used jewellery, and it was actually a Trollbead. I remember exactly what kind of jewellery it was. It was a Trollbead, Danish Trollbeads, used one of those. And that was really my first venture into e-commerce. Started getting wholesale jewellery, started stacking up boxes everywhere in the living room. And there came a part when she said, "You got to find another place for this. Can't have it in the living room anymore." Literally boxes from the floor up to the ceiling, all over the place. And that was really the start of it. Then started branching out into other products. Getting electronics and wholeselling in electronics from factories over out in China and many different other products. And it became a full blown on retail and in electronics.
Mark Jones:
Well, before we get into a bit more of your background, I'm really interested to know, give us a quick sense of what it was like online in 2005? I mean, I was there myself, but in terms of contrasting the experience from an e-commerce perspective, that's quite a period of time between 2005 and now. So give us a quick sense of what it was like?
Steffen Daleng:
Well, there's no APIs first and foremost. There's no major e-commerce systems back then that you could easily tap into. Doing e-commerce back then was expensive, extremely expensive. You had some O, I think it was OsCommerce was one of the first open source frameworks back in the day that most started using. And you had Magento coming out a bit later than that. But at that point it was extremely expensive to start up anything e-commerce wise, and many had their foray in starting selling on marketplaces, like myself. And then there comes a size with the fees, doesn't make sense anymore. You learn you need to own the customer. And ultimately it makes more sense for you to make that expensive investment of going out and starting your own, building your own platform and getting that up and running.
Steffen Daleng:
And with that comes information management systems and product management systems and e-commerce systems and et cetera. And all these things were disconnected back then. There wasn't really one big solution that could do it all. APIs with finances systems wasn't easy as well in the early days. And then of course there came the big part, which was, it was actually quite difficult to get stock and get inventory with many of the big brands when you wanted to resell that.
Steffen Daleng:
Now, while I had my start in factories in China, and that wasn't really that big of a problem in getting those kind of products, I ventured out into selling Samsung, Sony and all the of big brands. And the first thing that you hear when you're reaching out to the distributors is, "Well, okay, where are all your stores?" "Well, I don't have any stores, I'm online." And they would laugh you out of the room, literally. They would just laugh at you. "There's no way we're selling to you. Come back when you have some physical stores and we can talk."
Steffen Daleng:
So it was a bit of a journey trying to get inventory and get access to a lot of well-known brands back then. And everybody was often laughing you out of the room and saying, "There's no way that you can sell that online." So yeah, that was some of the challenges that we had back in the day. And you're nodding here.
Mark Jones:
That is, I'm nodding and I think that's really fascinating, because I suspect that the situation is completely reversed now where those same suppliers would be surprised if you had a retail store.
Steffen Daleng:
Well, it certainly become the norm now. Again, online penetration still is, depending on what country you're looking at, but here in Australia it's what, 13% right now. So majority of retail still happens offline, but you're absolutely right. Today it's the norm. You can hardly do retail without having an online presence, because most of the shopping and buying journeys and exploration happens online because there's, well, it's easier access to information than all the knowledge that you need to make a qualified decision on what products and where to buy them, so. Yeah, you can hardly not be online.
Mark Jones:
Now, just very briefly. Can you take us through your journey from Denmark? You've been in Indonesia and then through to Australia?
Steffen Daleng:
Yeah, so I had all that fun in retail and e-commerce just before the global financial crisis. So I guess right now we have a lot of great retailers that are, I guess, learning how to do retail and operate in an extremely challenging environment like Europe did back with the global financial crisis. But back then I ended up starting up at a small boutique agency in digital and e-commerce, conversion re-optimization as well, and led me to Italy. So spend some time in Italy. I think it was around two years there in Milan. Then I ended up in Indonesia, started up a production company with a co-founder in Indonesia, which was a fashion jewellery, funnily enough. Back full circle with the jewellery. Started that up and then I met an Australian girl and the heart wants what the heart wants.
Steffen Daleng:
So we of course fell in love and decided to move to Australia. When we found out that she was pregnant, it was time to take a new page out of my own story, I guess, try something new. And at that point it's been 10, 15 years of starting up different kind of companies in e-commerce and in marketing. And that's kind of how I ended up in Australia here eight years ago.
Mark Jones:
Take us then to the present, obviously it's exciting to have someone with your experience in e-commerce from a global perspective. Bring us right into the present with what it looks like for you at Booktopia? What are the demands on the business, and what's your focus right now?
Steffen Daleng:
Booktopia is a pure play retailer. So our primary focus right now is to look at a lot of this increased demand that's existing post-pandemic, if you will. We're of course still in the middle of a pandemic, but as we're recording this one right now, most of Australia are getting out of lockdown. And that means that we have a lot of physical stores that all consumers are very hungry to come out and visit. So right now the primary focus is to leverage the demand that was built during the COVID lockdown period, and making sure that all the customers that we brought into the business in that period are getting a great repetitive journey and communication to them and they were nurturing the way that we need to.
Steffen Daleng:
And one of the biggest things that we saw during COVID was that when the stores were closing down, we had all the physical book retailers that were no longer open. And you had a, I guess you could say that there was a particular cohort that were particularly resistant to buying online. We're talking about the boomers, the 45, 55 plus that preferred buying in physical stores and really weren't that keen on buying online. But when stores were closing down, they didn't really have an option. They didn't have any other choice than buying online.
Steffen Daleng:
So you have this huge opportunity in the market where you have a lot of customers that are buying online for the first time, and you have a great opportunity in really introducing them to your brand in that moment. But also having the respect to understand that there's a reason why they didn't buy on online in the first time. The way that you handle those customers, the way that you communicate to them, the experience that you're giving them matters a lot. So you really need to think about how you're going to be catering for that particular cohort and make plans for how you're going to continue to be relevant for them.
Mark Jones:
I'm interested because there is, I guess a part of this story that a lot of people who are not in e-commerce wouldn't have realised, which was, I imagine a sense of urgency to maximise the moment, right? So when everybody's locked down, it's a beautiful time for an e-commerce player. And I'm wondering to what extent your strategy was focused on really moving people from that first time interaction through to a loyal customer, getting used to buying things online through Booktopia and developing that loyalty or that sense of stickiness that would hold once we went back to the physical stores. How important is that for you?
Steffen Daleng:
Well, for me it's critically important. Like I mentioned before, it's about making sure that you have a full user journey. What you really considering about everything around, how do you get the first order? How do you get the customer in the door? But then have a plan for how you're going to get the second order, the third order, the fourth order, the fifth order? What matters to them? What kind of communication you need to put in front of them to create that brand loyalty outside of just a commoditized element. Books to a very high degree can arguably be called a commodity, it's the same product, no matter where you buy it. The only thing that you're really interested in is getting it on time at the right price. So, there is a simplicity in knowing that in that, that, well, if you make sure that you have the inventory and you make sure that when people are buying the product, you're shipping it out fast and keeping them informed along the way, timely informed that is.
Steffen Daleng:
Then you've really done 90% of it. Then within that, you do have a chance of building a little bit more brand loyalty and brand stickiness, a little bit more of remembrance in having an onboarding programme, making sure that you're at least putting some kind of communication information in front of them that gives them a reason to love your brand outside of just considering it as a commodity. And that's where some of the challenges come in, in terms of figuring out who do you need to say what to, and how do we make sure that you get in that right information in front of that audience?
Steffen Daleng:
Sometimes that's a bit of a guessing game based on the data that you have available, or the information that you might have around the customers, their inferred data, or the first part of that data that you might have. But that's what we're looking at. We're looking at, well, how can we get better informed by the things that we know and then the things that we infer? To then from there craft to journey that makes sense for each of the different cohorts that matters for us.
Mark Jones:
So give us a quick insight into what the experience was like from a sales point of view? So, incredible growth during the financial year, and also many people may not appreciate, you've acquired Angus & Robertson from Penguin Random House and the Co-Op Bookstore, and you launched Booktopia Publishing a couple of years ago, and you listed on the ASX in 2020. So this is a pretty significant organisation going places, right?
Steffen Daleng:
True. So the funny thing is that we started out 17 years ago as being founded by three marketers really. They had a boutique agency where they were doing search engine optimization and paid search for other retailers. And they've started Booktopia as a side project to just do this on the side. And then they could see that this was taking off, and they had a great opportunity here in retail. They doubled down on that instead of doing digital marketing, instead of running an agency. And the business never really got funding until I think it was like 2016 or so. Up until then it was all the profits reinvested back into inventory, better shipping opportunities for customers, more breadth, more depth in the categories and the choices around books, and then building up from there. So self-funded, bootstrapped all the way up until that 2016 mark.
Steffen Daleng:
So we then started up a division in publishing and we started up a division in wholesaling and distribution. That's called Booktopia Publishing and Booktopia Publisher Services. So a bit on the nose there perhaps in terms of the brand name, but either which way, it is, of course, us pioneering what book sales and book exploration should be for retail and really crafting the optimal experience for all book searchers and book buyers.
Steffen Daleng:
But within all of those improvements that we've been doing logistically and process wise we're of course also positioned for us where all of a sudden we had better distribution than many of the distributors. We had better facilities, better operation at scale than many of the big distributors that we were working with. And we could just see that this makes sense. We have a solution that is next to none. There's nobody better in this country at finding the right books, getting them in the door in a warehouse and then shipping them out on time. Nobody's better than us at that. So we had a great opportunity in building that distribution up for other retailers as well. So yeah, we've started that up a few years ago and that's become a success too.
Mark Jones:
Now that's a big claim, of course. Anybody listening to this will be saying, "Yeah, but what about Amazon?" We can't talk about this space without talking about your biggest competitor. Give me your perspective on how you compete with such a, I guess an iconic, well-funded global giant?
Steffen Daleng:
Well, the answer is, I don't. I don't look at Amazon. They don't sell books, they sell everything. It's literally called the everything store. They are a marketplace. Their book sales is a small fraction of their entire sales. That's not where their focus is. That's their legacy. That's where they started, like me and my jewellery. But that's not what they focus on. And I think anybody who works in larger businesses knows and understands that there's always going to be triage in any company. Triage is resolved by often category market share or category share revenue in a particular business.
Steffen Daleng:
You'll never see 90% of a company's focus being spent on 2% of the revenue stream, not going to happen. And books for Amazon is a very, very small stream in terms of the bigger picture. So what we focus on is book searchers, book buyers, and making sure that we can craft the best experience, that we keep our heads down and we focus on that. We talk to our customers, we talk to the market and we figure out how can we create the best experience for customers and we focus on that.
Mark Jones:
So who would be your competitive set then?
Steffen Daleng:
If really anything, probably the physical bookstores. The independent bookstores might be it, but I don't really see any of them as a real competitor. You could argue that perhaps Book Depository overseas might be one. So the pure play international book retailers that just focuses on books, those could be some of them. But yeah, even for the physical stores, look, there's always going to be customers who want to buy in physical stores. Like I said earlier on, 13% of retail happens online, the rest happens offline. That's significant proportion of the retail wallet that still sits offline. I buy books offline. When I come into an airport, buy books in an airport. I'm a regular customer like everybody else.
Steffen Daleng:
And I don't think it's healthy to think that it has to be an us versus them situation. I don't think it's healthy to say that online is better than offline. It's a matter of convenience, and whether or not you're buying in a physical store or buying something online, it's often really that. Particularly with commoditized products it's what's convenient for me in the moment.
Mark Jones:
Yeah, when we think about this whole space, I'm really fascinated in how we think about the psychology of buying books. Because it's often used as a proxy or a metaphor for sales in other categories. And it's kind of been something that I've been fascinated and looking forward to talking to you about, tell me about how important it is to be local. And by that, I mean .com.au, and the thinking that goes around distribution and speed, because you touched on this before, so is it available? What's the cost and how quickly can I get it seem to be the sort of primary drivers. What's the trade off? If I can get it fast from overseas at a lower cost or maybe a dollar or parity, then maybe I'll do it. What sort of insights have you had into the way that that universe works?
Steffen Daleng:
That's a good question, Mark. I think proximity matters. Proximity matters a lot. And the funny thing is to see how many multi-channel, and with multi-channel I mean companies who both have physical stores and online stores, how many of them only now are trying to do fulfilment from all the individual stores to get that proximity and get the inventory as close as they possibly can to the customers. Not that it's that much easier to operate hundreds of distribution centres, which basically is when you have a distributed warehousing like that with physical stores, can be quite messy too if you're not doing it right. But it does matter. It matters a lot. It matters both for your profitability as a company as well, centralised distribution can give you the advantage of pick and pack and scale, the scale of cost of units.
Steffen Daleng:
That can be great efficiencies on a profit line, but it can also come at the cost of speed of delivery to a potential customer. So I think proximity can matter a lot in terms of getting it out to the customer's fast enough, which can be the major competitive advantage that you're trying to build or maintain. But it also depends on what product it is. If you're talking about furniture, I'm still surprised that some furniture stores should take 12 weeks to get a couch to me.
Mark Jones:
You and me both. It's still mystifying to me as well. But another part of this story that has fascinated me is thinking about the expectations we set around delivery. And you touched on that, of course. This is another thing that we think a lot about when it comes to customer experience, of course, in the broader sense. But you are outsourcing part of your customer experience to types of delivery. To some extent you're outsourcing your experience to those providers. How have you thought about incorporating that into your strategy and how important is it to give people that sense of choice?
Steffen Daleng:
I think it is important, but again, the answer really depends on the vertical. It really does. It depends on what kind of products that you're talking about, the price level of those particular products, how commoditized it really is. Like I said before, there's a lot of physical stores around the country. There can be a lot of reasons why you can just pop in somewhere and just grab a book if it's just a quick thing you need to get. But for the people who buy it online, it's often about the convenience and they're not getting by a bookstore and they're happy with just getting it delivered like that. If you make that kind of choice, if you've already made that choice that it's not convenient for you to go into a physical bookstore.
Steffen Daleng:
And like I said before, for most people it's right around the corner, somehow, somewhere. Then you already kind of told me that you're not that fussy about how long it's going to take for you to get the product in the first place. So I don't think in books there's that big of a criteria for it, that it needs to come that fast. It's not really what we're seeing in the data either. There are some variations to how long it takes us with the handling time, but I've never really seen anything that points towards us going out and having the four hour, same day shipping or anything like that. And going out with a ‘Soon to you’ and all these different kind of courier services that could get a $15 book in your hands for $17 shipping. It doesn't really make sense at that point anymore for most people, for most people. And that's often what we need to make experiences for.
Mark Jones:
What I'm interested is, thinking about the psychology of customers and how things have been changing quickly. Quite clearly it's all leading towards data and insight. How are you consuming data? How are you moving to a place where you can be agile, because consumer needs change quite viscerally as the lockdowns ended, for example, in different states, instant changes to behaviour. You need to get that sense of what's going on. How are you embracing and kind of getting your head around that?
Steffen Daleng:
I would say not well enough is probably the starting point on it. I think like most marketers right now have probably come out a little bit more openly and said that, "We accept that we're on the start of the journey here." And right now it moves a lot. Technology moves incredibly quick in terms of connecting the dots between all of our data silos that we have in many different operations. Our journey is at a good point right now where we've recognised what it is with that we need. We build up MarTech strategy around it, data strategy around it. We've grown as a business. You mentioned it earlier on, we've IPO-ed here last year. We've significantly gained in size and scope of what it is that we want to accomplish. And we've hired all the right people to be part of that journey as well.
Steffen Daleng:
And part of that is people who is of course, talent that can really look at and interrogate data and derive the right kind of insights from it. But I still believe we have much more work to do there and getting all the right people on board that journey as well. Technology wise we're still leaning towards typically e-commerce data sources, which is of course your Google products, your Google Analytics, what you have available there in terms of seeing some of the journeys.
Steffen Daleng:
We also do look at creating a DMP, CTP, whatever you want to call it, really. And we do have access to a lot of that data today, and we have a lot of data scientists that can go in and actually extrapolate the data that we need on a very ad hoc level, and answer the questions that we might have around customer and consumer behaviour. We of course use data visualisation tools like your Tableau as an example, if you really want to name drop here. That can, of course help us with that. But a lot of it really is extracted out of a data pool.
Mark Jones:
And so it sounds at the moment it's reasonably customised and specific, right? So opportunity to grow and become more automated in the future. And I kind of asked too, because we've talked a lot about personalization in marketing for the longest time, and everybody's at different stages on that journey. So it sounds to me like you've still got quite a ways to go before there'll be quite a sophisticated level of personalization at your level?
Steffen Daleng:
We have a lot of access already. We are using a few front-end personalization tools that can help with all of that. But I think most of us probably appreciate that we tend to build MarTech stacks that are quite dispersed, where you have multiple tools, and each of those tools have the belief that they need to have great reporting, and that's true too. So you have all these different reporting capabilities that tells a different story about customers or insights based on each of those tools. You have an ERP, so an email platform that will tell some stories within that. Then you have some ERPs will try and double up as a CDPs and provide customer data insights within that. And even lifecycle journeys and information about customer cohorts. Get that in there too.
Steffen Daleng:
But like I mentioned before, then you also have a lot in Google Analytics, you have things in your Google AdWords. You have so many scattered insights I can see across the so many different tools that you're using in the business. And quite rarely do you see people who really managed to really connect that together into one big thing. So we're using all of the things, but I think most of the people and the peers that I talk to today, I don't really hear anybody who's really executing on their imagination. I don't really hear anybody who said, "Oh, this is what I could imagine we could do with this fantastic thing. And we've done exactly that." I don't think I've really met anyone who really believes that. But that's because the technology, technology moves fast right now and our capabilities and what we can do is running faster than what we can probably execute at the moment.
Mark Jones:
Correct, there's a lot going on in that space. And it's hard work to keep up, as you say. But it's interesting just to get a little window into how you're thinking about it. Now, if I can change tack for a little minute, in The CMO Show this year we've been looking at purpose-driven brands and how organisations are doing great things in the world. And the great thing about Booktopia is you've been working with Good360 and helping to manage a book donation programme. There's I understand about a million dollars worth of books that's going out to programmes like the Cathy Freeman Foundation, The Indigenous Literacy Foundation and other social impact initiatives. And Good360 itself, this programme I understand has donated books to more than, 2,600 Australian charities, not for profits and schools. So there's quite significant reach and some dollars flowing into that. How have you reflected on the role of a brand as needing to have a very strong social purpose in order to exist?
Steffen Daleng:
I think today it's more important than it's ever been. There's such a profound freedom of choice for so many people today. What I mean with that is, we have new generations right now that have a lot of choice, and they're putting their time, they're choosing jobs. They're choosing educations that leans towards greater good in a bigger degree than what we've ever seen before. In a world that supports those kind of altruistic choices a lot more, there's so much more opportunity for them to go out and really donate their time where they choose to work, like I said before. But also where they put their wallets, and that's something we all see across the board around green initiative, sustainability. It's not a movement, it's a choice. And I think because we have so many more people now in that generation that have more money, more time.
Steffen Daleng:
So I think for any retailer it's important right now to follow suite with that and make sure that we are also doing the same and that we're actively making a difference where we can. And so I think it's important and really imperative for any brand right now to find a way that makes sense for the business without diverting for the core part of the business. Like you got to focus on your operation and there's a reason why you put the mask on first in an aeroplane, right? You need to make sure that you're in a position where you can help other people. And for us it is important that we support literacy and that we support helping other people get books and help people learning how to read. You can argue perhaps to a degree that it's self-serving, if we can get more Australians to read, but they maybe buy books in the future perhaps, but at the end of it, it makes sense.
Mark Jones:
Well look, there's obviously an alignment there, and it's important for brands to support causes that are aligned to their core purpose, just from an integrity and it makes sense perspective, but I'm interested when we follow the trends. And this is something that a lot of marketers are now dealing with, as we think about where this is all going, which is that quite often we see, and this is by the way organisations accused of greenwashing or purpose-washing. It's the idea that I've taken a cause, or I've developed a purpose, which is really self-serving, but I'm not actually connecting it to an experience. So when we think about customer experience, that they actually understand what your purpose is. And they can see evidence of it in practice in a very real way. So that experience is where the purpose comes alive, if you like. The purpose is being experienced. It's a big challenge for organisations. Interested in your reflections on that and if you like the development or the maturity of purpose?
Steffen Daleng:
I think the challenge around purpose is that everybody keeps talking about it right now, because it's this new, almost like it's a new invented thing. And now we need to talk about it and you use the terms greenwashing before. I don't think there's anything worse than disingenuous efforts or disingenuous hunt for purpose. And I think that's where we've always stayed true to the core. We haven't changed what we're doing. We haven't changed what we're focusing on. We haven't changed the way that we're doing things. We're just doing a little bit more of it. And I think that's what I really love about Booktopia and our business here is that we haven't jumped on a fad of purpose. We've stayed true to our course all along. And we are really just escalating what we can do.
Steffen Daleng:
One of the recent initiatives that we've been doing that we're really, really happy with is, with size comes platform. And I think it was last year, we had 50 million visits to our website. We have 1.8 million active customers right now. There comes a, perhaps a degree of responsibility around having platform size. And I think, not to change the topic, but Facebook is probably one of the good examples right now. When you get size, you get scale, you become platform, and there comes a responsibility with that. Now, when you can do something, do you then not have the responsibility to do that, to do something.
Steffen Daleng:
So we've leveraged our platform right now and our size and the amount of Australians who come through our buying journey to introduce a donation function in our checkout. So that when you buy a book today, you can choose to round up a few cents, if you will. And when we launched this, felt good, it felt really, really, really, really good because you felt like now we're really sure that we did something with the mass that we had, the scale that we had in the platform that we had. And that we did something to talk to that, to really do something with the scale of the platform. But what surprised me even more, can't really give any numbers here, but the amount of Australians who choose to donate is staggering. I would have never thought that it would be as many as it is. So it's such a heartwarming situation that we got to do something that mattered for us, and then seeing the Australian population back up around that is just, it's fantastic. It feels great. So it's one of those things that makes you smile when you get up in the morning.
Mark Jones:
That roundup scenario is actually where your purpose is being experienced, because you've said, "We care about the community. We support organisations through literacy, and by the way, here's something you can do." So it is actually being experienced, but perhaps at a higher level there's not a, you're sort of suggesting that if you like, that's a natural outworking of how we think, it's part of what we do. There's not this kind of big strategic conversation that's sort of fueled at a sort of an intentional way. That's my interpretation. Is that what you're saying?
Steffen Daleng:
It didn't come all the way up in the top, "Let's make a work group or something and talk about how we can look good." We don't do that. We make a difference when we can and where we can and where it makes sense. I still think that you can, of course, sit down and have a group of how can we create more purpose, but we don't take that approach on it.
Mark Jones:
Yeah. What's the Booktopia future looking like as you come out of the lockdown universe and think about 2022?
Steffen Daleng:
Well, we've set some audacious goals. We've acquired a few companies and we're still looking at acquire more companies. When we did the IPO back in 2020, we got around 40 plus million dollars into our coffers and really spending majority of that on improving our distribution centre, how fast we can ship out and really becoming even better around the distribution component of our business, both the wholesale and the business to consumer. But at the same time we've also been acquiring stakes in international companies. So for us the future really is, we're going to be a $1 billion sales company, Booktopia Group. So right now we're looking at, what do we need to do to get to that point? What kind of companies do we need to invest in to be part of that journey? Some of it will come through growth in the category and winning more market share here in Australia, but some of them, some of it will come from international overseas growth as well.
Steffen Daleng:
Not long ago we took a 25% stake in the UK-based Welbeck Publishing Group as well. And we'll be launching with Australian distribution around that here in 2022 as well. So for us, it's really cementing our position as the retailer here in Australia, as Booktopia being the book retailer in the country. But also around our publishing industry, our publishing business, going out and producing more books, printing more books, getting more talent in and growing that part of it. But also being the best distribution and wholesale partner to all the independent bookstores that could benefit from Booktopia's fulfilment and superior pricing.
Mark Jones:
Well, I got to say, that's pretty exciting and strategically the connection between a publisher, becoming a publisher, and the distribution side of things, that's obviously very clever and I think a great thing for the local market, but for authors and so forth. One of the great things that I've loved about the growth of the internet is that books have still thrived in the online world. I think it's a wonderful thing. There's nothing quite like the experience.
Steffen Daleng:
It's great actually, recession proof we call it.
Mark Jones:
Yeah, who would have thought? I got to say, I really enjoyed our conversation. Steffen Daleng, thank you so much for being my guest today on The CMO Show.
Steffen Daleng:
Thanks for having me, Mark. It's a pleasure.
Mark Jones:
So that was my conversation with Steffen Daleng.
Now I think Booktopia is a great example of a company that has really seen an opportunity within the market and ensured they’re standing out of the crowd with a seamless customer experience.
They’ve got their purpose so well aligned with what they do - supporting the community with literacy outreach.
I also loved Steffen’s origin story, how about that idea of selling his girlfriend’s jewelry and fast-forward it’s led to Booktopia today.
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