Irish online gift company succeeds in delivering the goods
E-commerce pioneer Lulu O'Sullivan has a gift for doing business, but growing her online sites has not been without its challenges
Lulu O'Sullivan is the founder and chief executive of GiftsDirect.com. Set up in 1987, the company has since grown to become Ireland's largest gift delivery business – providing hampers and gifts for delivery all over the world.
"We make gift giving as convenient as possible no matter what the occasion," Lulu tells me. These occasions include birthdays, weddings, new babies, Easter, Christmas, Mother's Day, Father's Day and Valentine's Day.
Lulu takes me on a tour of her offices and warehouse in Glasnevin in Dublin, where her staff are busy taking orders and dispatching gifts that include everything from personalised wine, whiskey and champagne to fruit baskets and home ware. "With more than 3,000 products available, we have something for everyone," she tells me.
For women there are flowers, chocolates and jewellery, as well as an extensive range of pampering and spa gifts.
And for the men?
"We have lots of gifts for men, too," she says with a laugh, showing me a range of cuff links, electronic gadgets, fine wine and whiskey gifts.
"Vouchers are also becoming increasingly popular and allow us to offer gifts such as cookery classes, driving lessons, photo shoots, pampering and spa experiences, hotel breaks, golf and even flying lessons," Lulu explains.
She stresses that 90 per cent of all the goods supplied by GiftsDirect are sourced from Irish companies. "That's important to us here," she says. "Because we are keen to help support Irish businesses wherever we can."
There are a number of players in the sector now but hers was one of the very first gift delivery businesses in the country. "Many people thought I'd lost my marbles, setting up a business that focused solely on selling direct without a retail store element to the plan," she says. "Up to then flowers were the only thing that you could order to send as a gift. So we really had to educate the market."
The business started out by offering teddy bears and was, initially, aptly named Inter-Teddy. The idea of a personalised teddy bear arriving to your office or home was something new and different.
She remembers her first marketing campaign. It included placing an advert in the middle of the Yellow Pages section for Florists. It read: 'Bored with Flowers?'
"That didn't make me very popular with many florists," she laughs.
Lulu travelled to Australia when she was in her early 20s and worked in fashion there. While she loved the work and the country, the call of home and her family and friends brought her back to Ireland.
However, when she arrived home, she couldn't find a job. So, she decided to take her destiny in her own hands and signed up for a Fas Start Your Own Business course.
Business is in her blood. Her granny owned a sweet shop on Merrion Row in Dublin. From the age of six or seven, Lulu worked in her granny's shop. She marvelled at how some customers passed two or three other shops to come to her granny's shop.
"She always had a word for people and made them feel really welcome," she remembers with a fond smile.
Lulu found the Start Your Own Business course very beneficial. She remembers how the tutor encouraged students to visit their local bank manager to gain the experience of looking for a start-up loan. "One of the class came back saying that they had met a very friendly bank manager in a particular bank in the city. So, the following week, we all traipsed off to meet him," she laughs.
In her first year of business, Lulu made a handsome turnover of €38,000. She focused her attention on providing exceptional customer service and worked on the premise that it was cheaper and easier to keep a good customer than it was to try and find a new one.
She drew, too, on the experience of having watched her granny run her shop.
"I wanted to ensure that our customers would come back again and again, and that they would become ambassadors for the business based on the exceptional level of customer service they had experienced," she says.
And it worked.
In 1993 she was invited by Bewley's to manage its hamper business in tandem with running her own business. Over the following five years, she helped Bewley's grow its business by more than 1,000 per cent. Bewley's offered her a full-time role and offered to allow her to merge her Inter-Teddy business with theirs.
She remembers thinking that, even though she enjoyed the job, she was building someone else's brand.
In true entrepreneurial spirit, she declined the offer. Instead, she made the decision to focus on growing her own business. She changed her company's name to GiftsDirect.com and began dramatically expanding the range of gifts offered. It was not, however, without its challenges.
"We had one of the very first e-commerce websites in the country," says Lulu. "In many ways we were ahead of the market. At the time, people were very slow to input their credit card details on to the web." But she followed her intuition and remained committed to building an online business.
"And then it all changed with Ryanair," she says. "The lure of low-cost flights helped change people's behaviour and so customers gradually became more comfortable with using their credit cards online. It certainly helped pave the way for other businesses like ours."
Today, 90 per cent of her business originates online, while 10 per cent comes from the more traditional avenues of catalogues or phone sales.
Her market is broken into two distinct streams: general consumers, and the corporate market. Even against the backdrop of the downturn, she has managed to retain 80 per cent of her corporate customers, though many have scaled back on their average spend.
"While slower, it's definitely beginning to pick up again," Lulu says.
When the corporate market first began to slow, Lulu shifted her focus more on the consumer market. She remembers a difficult time in the business when, in 2002, she began to introduce reader offers catalogues. These printed catalogues contained all types of electronics, hardware and DIY products.
"It was such a different target market to the gift business," she recalls. While the comapny's turnover shot up dramatically, the products were so price-sensitive that Lulu started to lose money in the business.
"We took our eye off the gift market for a while," explains Lulu. "But it taught us a great lesson – to focus on the core business."
And that's what she did.
In 2009, Lulu signed up to undertake the Leadership for Growth Programme, supported by Enterprise Ireland. "It was a turning point in the business," she explains.
The programme helped her realise that she now needed to scale the international side of her business.
She set up a second gift website business, called Siopa.com, selling only Irish products to the diaspora. "Everything on the site is Irish," she says. She has 1,200 products currently on the site with a further 1,000 going online shortly.
While she has all the well-known brands such as Galway Crystal, Belleek and Boru Jewellery, she insists it's not just about big brands. With her market coming mostly from the US and the UK, she tells me she is keen to give small Irish companies and new brands an opportunity to market their products internationally.
She expects that Siopa.com will outgrow GiftsDirect.com. "Our aim is to become the largest online Irish gift company in the world," she says.
Key to this has been the development of a fully integrated IT infrastructure which allows her customers to not only order online, but also to track their gifts right through to delivery.
The business has won many awards, including the Irish Internet Association Entrepreneur of the year 2007 and the Best Exporter 2012.
Lulu currently employs 20 full-time people in the business. This figure can jump to 50 during busy times such as Christmas.
"Christmas is a mad time," explains Lulu. "Our staff are fantastic, and we regularly work into the middle of the night to get orders out on time. But it's also a great fun place to work as well."
Many entrepreneurs who start online businesses have the aspiration to sell or exit. Is that on the cards? I ask Lulu. "I guess the business is always for sale, if the price is right," she says, smiling.
Lulu's husband, Brody Sweeney, is also a well-known and respected entrepreneur who, in the past, grew the O'Brien's Sandwich Cafe business into a worldwide phenomenon. More recently, he set up a chain of Thai home-delivery restaurants, called Camile.
Does she think the life of an entrepreneur is tough?
"Business is like playing a sport," Lulu explains.
"Once you tog out on the playing field, you're going to experience your fair share of knocks and tussles. That's part of the journey."
She says determinedly: "The secret is to get up, dust yourself down and keep going."
Lulu O'Sullivan has shown incredible vision. She started a gift delivery business when there were few others in the same space. And she was one of the very first to set up an e-commerce business in Ireland, pioneering the way for others to follow.
She has supported Irish manufacturers by opting to choose their products over others. She is helping to support new Irish brands in getting their products into international markets.
She has grown her business around delivering not just great gifts, but exceptional customer service.
She has demonstrated tenacity and resilience and has committed herself and her business to continuing and never ending improvement.
Her granny would surely be proud.