Making niche markets blossom
- Josh Mehlman
- 4 November 2009
Photo credit: Anthony Geernaert
One recurring skit featured Steve Vizard as slimy, ponytailed advertising executive Brent Smythe and Peter Moon as his offsider Barry. In one memorable moment, Brent talks about how creative the advertising industry is and asks, "Where do we get ideas from, Barry?" Barry instantly replies, "America."
This was definitely the case for Kelly Baker, founder of Edible Blooms
.
"I was flying from Paris to New York, which sounds really glamorous, reading the American Airlines magazine and saw this ad for a company doing fruit bouquets," she explains. "I thought, ‘What an amazing idea'.
"So when I landed, I had a look at one of their locations and loved the concept. I didn't think the way they packaged it was suited to the Australian market, but the concept itself I thought had great potential for Australia. I hadn't seen anything like it back home."
On the fast track
Baker, who comes from an entrepreneurial family, started the business at age 27 in September 2005 while she was working as a marketing consultant for a large legal firm.
"I have always wanted to have my own business, so I started looking at buying an existing company," she says. "I very briefly contemplated franchises, but realised that wasn't being in control of my own destiny.
"When I came back from the United States, I did a business plan and three months later, I opened the first Edible Blooms in Brisbane. We launched with nine products, all fresh fruit bouquets."
Getting in early
The disadvantage of starting a why-didn't-I-think-of-that business, or importing one from overseas, is it doesn't take too long for imitators to spring up. Gaining a first-mover advantage, and a large market share, is critical. Recognising this, Baker opened branches in Adelaide, Sydney and Melbourne within the first year of operation.
"We wanted to be the lead player because we were building a new niche gift, an alternative to hampers or flowers," she says. "There are lots of copycats now, which is fine; actually it has only made us busier. A lot of them are cottage industry and work from home. We operated from commercial-grade kitchens from day one."
Baker says the choice of locations was also critical to ensure the best balance of convenience and cost.
"We want to be an e-commerce company, not a traditional high-street retailer," she says. "In Adelaide we have a high-street shop, but in Sydney and Melbourne we chose locations on the city fringe. Most of our deliveries go into the CBD or inner suburbs, so we want to be as close as possible without having the big overheads of high-end retail. People can come in and pick things up if they prefer, but we can get things into the city really quickly."
The product range also grew from the initial concept of fruit arrangements to include cookies and chocolates.
"Originally I registered the business name Fruit Blooms and it was only about two weeks before I opened the doors that I thought I would change the name to Edible Blooms," says Baker. "The business plan kept progressing and I saw opportunities to grow the range outside of fruit.
"When I was doing my research, there was another franchise in the US that was doing chocolate bouquets. They are really ugly, but that is where the idea came from. There is another company that does cookie bouquets. We pulled all those three concepts into one business model."
Fresh fruit
To maintain a leading position in ecommerce, websites must be constantly maintained and periodically revamped to ensure the design and functionality stay contemporary.
"We probably average every four or five months to do a major upgrade - some kind of major design change or feature gets added to the site," Baker says. "It has been expensive, but not being a high-street retailer, you must be prepared to spend on your website what you would on a bricks-and-mortar shopfront."
The company's product range also needs to change regularly to keep customers coming back.
"We have our own innovation pipeline which means we put new products in throughout the year," says Baker. "About every three weeks there is something new on our site. That keeps it interesting."
Edible Blooms has successfully tapped into a market poorly served by the flowers and hampers industries: men.
"There's the old saying that the way to a man's heart is through the stomach," Baker notes. "On Valentines Day, I think something like 95% of flowers go to women. But 60% of our Valentines gifts go to men.
"That is great because men are hard to buy for. Men are happy to receive a bouquet of chocolates as long as it is not girlie looking. They love it because they get to eat it."
Work isn't everything...ish
Family support made a huge difference, even if it was just in the form of encouragement or a pat on the back, Baker says. It is also vital to see a world beyond work.
"If you set yourself a non-work-related goal, it helps you get that balance," she says. "At the moment I am training for a half marathon.
"For the first two years, I had no work-life balance. I knew that I had to commit two years to a business to get it up and running.
"I moved to Melbourne in March this year and things have certainly got a lot better since then. Abbey moved into the operations role full time and Tara came on board. I can actually take holidays now! I went to Thailand for a week and everything worked while I was away."
At risk of being sickeningly upbeat and positive, Baker encourages anyone with a good business idea to go for it.
"I had to spend all my savings to start the business, but at least now I can turn around and say I gave it a go and it worked," she concludes. "I think it would be so much worse if you saw someone else take your idea and make it successful." #
