• “We’ll create a more socially connected brand”
• Social media will influence store opening strategy
• Turnover for the last financial year reached £50m
• Taking Morrisons online “rare opportunity”

Kiddicare began life in 1974, but it wasn’t until 1999, when the website launched, that the business really took off. “Now, 85% of our business is online,” says Simon, the company’s COO.

Morrisons acquired the business in February 2011 for £70m. “Morrisons threw a curve ball into the mix,” admits Simon. “They had no online transactional presence and no experience outside of food retail, but we liked them culturally as they brought something different to the table. To be able to take a FTSE 100 company online is such a rare opportunity. We believe that we can create a paradigm shift in the retail model and how people buy goods. We will look back on this period as a defining moment in commerce.”

Whilst Kiddicare will provide the platform for Morrisons to pursue its multi-channel aspirations, Morrisons will help advance Kiddicare’s natural ambitions for growth.

On its own, Kiddicare is still thriving. Turnover for the last financial year reached £50m. With a target to open 10 new stores in the next two years to complement their sole offering in Peterborough, the eventual aim is to push turnover to half a billion pounds, with over £250m achieved in the next four to five years. “These are ambitious figures but we’ve seen 30% growth on the website year-on-year and the new stores provide a unique platform for success” Simon reveals.

To facilitate these ambitions and to ensure a seamless entry for Morrisons into the multi-channel and non-food retail arena, the company has enlisted the help of former White Stuff and Charles Tyrwhitt director Alison Lancaster.

As Chief Marketing Officer, she will oversee marketing and PR across both brands from a multi-channel perspective. “We were very consonant that the organisational structure needed to change in order for us to realise our ambition.” says Simon.

Turnover for the last financial year reached £50m

This year in addition to the new stores, Kiddicare will implement a new CRM system, launch its own brand range of toys and extend its product offering. It’s a big job that Alison will spearhead and Simon is enthused.

“Branding is one area where we are particularly weak. There will be a huge advertising and marketing push. We will also utilise social media to give customers the opportunity to be involved in the decision over which store we open next,” he says.

Without divulging too much, Simon adds, “There will be some really interesting and exciting developments this year. Our ambition is to reduce our reliance on TV and traditional advertising campaigns through creating a more socially connected brand.”

With such a dedicated team behind them, Kiddicare and Morrisons look set to take the multichannel retail arena by storm.

Online retail figures joined Leon Bailey-Green at the launch of his short novel Affairs Of An Internet Business out now at Amazon.co.uk.

Click here to find out how to get the Kindle App for your computer or mobile device to read this book.

Photos (Part 1) | Photos (Part 2) | Photos (Part 3) | Photos (Part 4) | Video

Online retail figures joined Leon Bailey-Green at the launch of his short novel Affairs Of An Internet Business out now at Amazon.co.uk.

Click here to find out how to get the Kindle App for your computer or mobile device to read this book.

Photos (Part 1) | Photos (Part 2) | Photos (Part 3) | Photos (Part 4) | Video

Online retail figures joined Leon Bailey-Green at the launch of his short novel Affairs Of An Internet Business out now at Amazon.co.uk.

Click here to find out how to get the Kindle App for your computer or mobile device to read this book.

Photos (Part 1) | Photos (Part 2) | Photos (Part 3) | Photos (Part 4) | Video

Online retail figures joined Leon Bailey-Green at the launch of his short novel Affairs Of An Internet Business out now at Amazon.co.uk.

Click here to find out how to get the Kindle App for your computer or mobile device to read this book.

Photos (Part 1) | Photos (Part 2) | Photos (Part 3) | Photos (Part 4) | Video

Online retail figures joined Leon Bailey-Green at the launch of his short novel Affairs Of An Internet Business out now at Amazon.co.uk.

Click here to find out how to get the Kindle App for your computer or mobile device to read this book.

Photos (Part 1) | Photos (Part 2) | Photos (Part 3) | Photos (Part 4) | Video

Take part in the thought-provoking ‘Are you fit for the multi-channel challenge?’ webinar taking place on February 21st.

This necessary webinar focuses on the initial journey of a multi-channel customer; buying what they want, the way they want, on their terms and delivered how they want. Register now to ensure you do not miss out on this invaluable free event.

Webinar Details
February 21st
1.00pm

Discussion will also focus on how to improve your supply chain flexibility and agility to meet these customers’ expectations, starting with a single global view of your inventory.

Former Apple boss Craig Sears-Black (left) from Manhattan Associates and Ishan Patel, Group Omni-Channel Director, Aurora Fashions will be involved in this webinar.

• Amara sales up 143% to £1.13m
• Plans to take brand portfolio to 150
• New business Lovehats.com launched last week
• Lovehats.com “international from the outset”

We know from a survey conducted last year that Andrew Curran is a firm favourite you enjoy reading about – beaten only to the top spot by Charles Tyrwhitt founder Nick Wheeler – so we’re certain there will be plenty of interest in his most recent endeavour.

Andrew’s creating a go to online millinery store with Lovehats.com which launched just last week. More on that later, but first let’s look at Amara, the luxury online home accessories retailer where he is Chairman.

When Andrew last spoke to Directors Of .COM in October he told us he “only thinks in terms of triple digit growth.” He certainly walks the walk. Amara finished up 2011 with sales of £1.13m, up from less than £500k sales in 2010 – a 143% increase.

His magic touch is helping to put the online retailer in good stead for the future. Amara is about to raise over £1m investment from a series of high-net-worth individuals.

Plans are under way for the company to launch its own range of bedding to complement its brand portfolio which it hopes to grow to 150.

Andrew’s new business, Lovehats.com, is equally as exciting. The venture, which has been six months in the making, came about following a chat with a milliner which lead the former my-wardrobe boss to consider the online retail possibilities for occasion headwear.

Lovehats.com has been six months in the making

After researching the market, Andrew realised the potential. Little competition, a desire by hat makers to retail online, and most importantly good margins.

Lovehats.com stocks brands such as Philip Treacy London, J Smith Esquire and Celine Robert. It allows users to try on hats by uploading a photo and has editorial content in its Headlines section.

I asked Andrew if he had considered a marketplace model but this is ruled out. “We want to be consistent with our photography as well as the fulfilment and customer service” he tells us. Brands on the website all engage on an SOR (sale-or-return) basis, making the business model an even more attractive one.

Andrew sees this business as a logistics company, an international one at that. “We’ve launched with seven languages and the website is multi-currency. It was important to do this from the outset” he says. You can tell he’s done this before.

2012 is getting off to more than a good start for Andrew Curran.

• “Thrilled” to see Online Fashion Week trending on Twitter
• Visitor reaction was “really positive”
• “Retailers made great sales that week”
• Proactive retailers “win” during Online Fashion Week

Online Fashion Week trended on Twitter on launch day. Was that a surprise?
We hoped it might – we knew there was a big buzz about it – but we were thrilled that it went on all day.

Where did the idea for Online Fashion Week come from?
The success of Fashion’s Night In in November 2010 made me realise what potential it had – we work with so many brands trying to develop their online businesses; we wanted to do something that would support them and celebrate the development of the online fashion industry.

The week long event took place in December, but when did planning begin?
January 2011 – but we really got going with planning the build in March after Paris Fashion Week and then with the reality of the event after Paris in October.

What reaction have you had from your visitors?
Really positive – it was a whirlwind of a week. We’re looking forward to making the event even better next year. Some people wanted more editorial so we’ll take that in account too.

And what reaction have you had from retailers involved?
In general it’s been hugely positive because as a concept it was so welcome. Some retailers made great sales that week, whereas others just got their brand profile out there. Others were disappointed with a lack of sales – we’re trying to take all the results into account so we can refine the event.

How do you balance giving campaign prominence to independents as well as well-known brands/retailers?
We’re trying to entertain our consumers as much as we can – first and foremost we’re a consumer website so the users have to come first. Having said that, our users want us to inform them about new and interesting independents as well as activity relating to the big global brands so we have to balance it so that we can support both.

It’s meant to celebrate inclusivity and there is more we can do to refine the process I think. There are so many hundreds of retailers out there and we need to provide the best window onto the world of e-commerce without inundating the users.

Do you think some retailers maximised being involved more than others?
Definitely. Some planned their activity well and also their communication with us well so that we could help them as much as possible. Being proactive on both counts is the way to win during Online Fashion Week – we try to work with as many businesses as possible on it and there are so many of them, it helps if they try to make it easy for us to help them.

Is there a plan for Online Fashion Week in 2012?
Yes.

What will you do differently in 2012?
I hope we’ll make it easier for the retailers to understand what they can do to help themselves gain greater sales and brand profile from it. I hope we’ll include more editorial to entertain the users that will in turn tempt them to buy even more. As I say, we’re taking all the feedback on board – it was our first event of this kind at this scale and it was a big success, but we try to improve things every time we do anything – it has brilliant potential I think.

www.onlinefashionweek.co.uk

RESULTS:

ASOS 45%
Net A Porter 21%
Play.com 17%
The Hut Group 14%
Ocado 3%

According to Retail Week online retailer Play.com, owned by the Japanese Rakuten group, is considering introducing payment on delivery.

We asked whether you agreed or disagreed with these statements about payment on delivery.

RESULTS
It will increase conversion rates 88.9% Agree | 11.1% Disagree

It will be a logistical nightmare 88.9% Agree | 11.1% Disagree

It will increase order values 55.6% Agree | 44.4% Disagree

It will encourage bogus orders 100% Agree

It will lead to greater brand loyalty 33.3% Agree | 66.7% Disagree

It will benefit economic consumer groups with no access to credit/debit cards 100% Agree

It will be adopted by UK online retailers in the next few years 22.2% Agree | 77.8% Disagree

• More high value deals, like Kiddicare and Wiggle, to come in 2012
• Oakley keen to acquire or invest in £10m+ businesses
• How high valuations/offers can lead to conflicts
• Plan to grow and improve Intergenia following €40m deal

What will 2012 look like for private equity deals in online, retail and digital media?
Expect to see continued strong interest from private equity in the space. Proven “game changing” online and digital models will continue to see deals done at high valuations (like Wiggle and Kiddicare) as private equity investors look to support the next big thing.

We are currently looking at several live online transactions including internet food retailing in the UK, online consumer services in Germany, digital media services in the UK and online clothing in Germany.

What should owners/founders look for in a private equity partner?
More than just a cheque! There are plenty of funds with money, but a lot less with the entrepreneurial, strategic and operational experience to really add something to the business.

Owners/founders should take the opportunity to add to the skillsets on their Board. They should avoid working with partners who offer them the highest valuation but are new to the sector – these partners are overpaying because they don’t understand your business and this usually leads to conflict down the line.

Tell us about Intergenia your most recent investment. How will the business change now you have taken a majority stake?
Intergenia is a German web-hosting business for medium sized businesses and is riding the wave of growth in companies increased use of the web.

We bought 51% from the founding entrepreneurs and will work with them to combine the best of our skills to accelerate growth and improve the business. As with other entrepreneurial businesses we have invested in, we will help to develop strong financial discipline and reporting there, as well as using our own experience, and that of our network of senior industry contacts, to provide strategic advice around a planned new product development and launch.

Apart from the funding aspects, what strengths does Oakley Capital Private Equity have in technology/e-commerce/digital?
Oakley’s senior team has a well-established track record in buying and investing into, operating, growing and selling businesses in these niches – our track record includes Pipex, 365 Media, Daisy Group, Verivox, Host Europe and Emesa.

We combine capital with proven entrepreneurial flair, and operational discipline. Unusually for a private equity firm we are run by an entrepreneur, Peter Dubens, who has founded, built, grown and sold a whole variety of business.

Most of these deals have been in technology/e-commerce/digital, and therefore the network of contacts we have in the sector is a real differentiator for us.

Also, we are able to provide all elements of the capital structure in our deals, including debt and mezzanine debt if it’s relevant.

What criteria does an online retail business need to have to meet your investment strategy?
In short, something which gives a business a compelling and defensible growth proposition – be that in terms of its product, its market niche, its route to market, etc.

Right now I would be keen to acquire, and/or invest into, a business which gives Oakley the opportunity to put in excess of £15million of capital to work. For newer businesses it’s unlikely that we will invest in businesses with turnover of much less than £10m and it would probably need to be turning a profit – we are looking for businesses which are proven and showing growth.

Alternatively we will look at larger, long established brands which have “lost their way” but have the potential to be reinvigorated. These are likely to be say £40m plus of turnover and may be loss making, but capable of a turnaround and a return to profitability.

One of the most important things to remember when being a boss is… that you have to lead by example. You need to be the first one into the office and the last one out.

The reality is, when you are the boss and getting started is all on you. If you don’t set the example, then you can’t expect even the best people to work any differently.

The internet business is a great industry to be in… because it is still so young. We have the ability to create experiences online that are simply not possible on the high street.

We are barely scratching the surface of what can be done online and the sooner that you are involved in the online world the sooner you will understand that it is going to pervade every aspect of modern day life.

After leaving school I… worked for a logistics company and then went travelling. Seeing a bit more of the world opened my eyes to other cultures, to realising that we all live in a tiny bubble and every so often it is quite a good thing to have the bubble burst, if only as a realisation.

I started my business with… £40,000. This could have been much less, but the reality is that we wanted to grow into being the biggest crowdfunding platform in the UK in a space of months, not years.

Anyone looking to start a business, if the idea is any good and you know what you are doing, then you don’t need a fortune to get it going. You need to know how to sell people on your idea, sell them that you are the right person to make it happen and then bring in other investors if you don’t have the cash yourself.

I would encourage young people to join the internet business because… we are just starting on an incredible journey. In the last couple of years we have finally seen how great smartphones are, if we are all online and all our transactions have a method of being understood online, the power to completely transform mundane tasks should disappear.

One app that I particularly like was one that tells you when the bus is going to arrive at your nearest stop – this has already saved thousands of parents the hapless task of waiting at a bus stop just to put their kids on the school bus!

In the next six months I hope to achieve… a crowdfunding revolution with PleaseFund.Us. This sounds a bit grandiose, but we are hoping to transform the way in which people view the funding of the arts, funding of new businesses and even funding of good ideas.

• Turnover target of £50m
• Foray into TV advertising
• Plans to move into male health and nutrition
• “Retailer price slashes creates unstable luxury market”

“I’m a board level director so I strategise for the entire Group. It’s great to be part of a bigger company [The Hut Group], I’m learning a lot more than when I was just a part of Lookfantastic,” Daniel begins.

The Hut Group acquired Lookfantastic just as it had reached a “cross roads” with its development, having a turnover of £21m. Daniel knew it was time to expand significantly but in order to do that, a robust partner had to be found.

“We wanted to ensure that our partner would take care of more arduous tasks – warehousing, financial and IT operations. The Hut Group had substantial warehousing and IT facilities with plans for expansion, so that cemented the deal,” Daniel explains.

The integration of Lookfantastic’s IT operations with those of The Hut Group is an on-going process, but Daniel hopes this will help the company to reach its target turnover of £50m. The figure for 2011 has yet to be finalised.

The deal also allowed Daniel to concentrate more of his time on the strategic side of the business – marketing, advertising, PR and buying. This year will see a foray into TV advertising.

And he doesn’t intend to stop there. “We also want to expand the range. This is always an on-going goal, but we would like to move into the male health and nutrition market,” he reveals.

Lookfantastic plans to grow mobile offer and add make-up and hair tutorials

With backing from The Hut Group, this may not be such a challenge. The group already owns ManKind.co.uk and Myprotein.com. “That’s a bonus for us as we can work together and utilise our contacts there to aid our expansion into this arena, yet another benefit of being part of The Hut Group.”

Being a part of the Group might strengthen the business, but Daniel doesn’t want to become complacent. To remain ahead of the competition, social media will play a large part in Lookfantastic’s development.

“We want to grow our mobile community and include videos and tutorials on the site, such as make-up application tips and hairdressing tutorials,” he says.

Offering unique deals into the year will also become paramount for the company, especially at a time when retailers are discounting deeply to attract customers. Daniel says that this was the biggest challenge for the online retail market last year and will continue to be well into 2012.

“Economic uncertainty is a huge challenge for the online retail market. Retailers slashing their prices have created such an unstable market for the luxury goods arena,” Daniel says. However, he says that the company isn’t discounting deeply. “That only leads one way.”

The biggest challenge this year for Lookfantastic will be to maintain growth. “This is the biggest challenge ahead,” he concludes.