Going all in with Spotify-style agile
Trent Mankelow - Trade Me Group
It is no accident Trade Me Group is taking radical action to boost innovation internally: it has found itself in an odd and unfamiliar situation.
For 15 years, the site grew accustomed to being a disruptor - one of the online classifieds success stories that took down the Goliath newspaper.
But Mankelow is frank about the current situation and admits there are big and fierce players on the scene with scale and international pricing working in their favour, while the traditional bricks and mortar retailers heave themselves into the online trading space.
The company is feeling the heat in its Marketplace, the front page of the site that deals with buying and selling general items. Revenue through this major segment was down 1.5 percent in the last half-year.
“When you look at the overall growth in ecommerce, the growth of our marketplace business isn’t really keeping up with that. It is a really interesting position to be in after a decade and a half of being at the forefront of of that disruption,” Mankelow said.
“We have found that a lot of organisations have really stepped up their game, whether or not that is an ASOS with free shipping around the world, or Amazon which continues with innovation, or even locally Briscoes or Rebel Sport and all the major New Zealand retailers that have really lifted their game.”
Trade Me Group is more than New Zealand’s answer to eBay, however. There is no area of online trading it isn’t into. Mankelow describes the business as “kind of a combination of eBay combined with Carsales.com, combined with REA. It’s like everything mashed together.”
This means Mankelow’s team have more urgent fish to fry than the global auction giant. Trade Me holds 90 percent of the used goods market in New Zealand, where eBay never really gained traction. He is looking further afield for the next competitive threat.
“We have competitors in all different pockets. It means we can’t be complacent,” he said.
“We actually decided that Facebook groups would be an interesting comparison. They are gradually making it easier and easier for people to buy and sell on Facebook.”
One of these new fish is Tinder, which has taken a huge chunk out of the sleepy match-maker market that includes Trade Me business FindSomeone.
Mankelow said the only thing more amazing than Tinder’s decimation of sites like match.com, Okay Cupid and eHarmony was the speed at which it has happened.
“Tinder basically knocked them all off the top. These guys were cruising along thinking that things were going well and then 200 days later they were in freefall decline.”
Investing in renewal
“It’s no secret that we’re in the throes of an accelerated period of re-investment,” Trade Me chairman David Kirk told shareholders in February.
The business is not planning to sit around as its model is swept out from underneath it, so is planning an aggressive period of acquisition, continuing a year that saw it buy a stake in peer-to-peer lender Harmoney, online payments gateway Paystation, and real estate inspection management application Viewing Tracker.
For his part, Mankelow is rebuilding the website to proper leverage the “mountains of data” the group is sitting on, and the company is in the final stages of recruiting a head of analytics.
“We are really trying to get our act together around the data side of our business," he said.
“Not many businesses are looking at life in the way we are. We know what kind of jobs you look for, what kind of vehicles you buy and what kind of property you are interested in, as well as what new and used goods you buy and sell.
“Our desire is to offer experiences that are much more personalised so that your home page is different to mine, and the EDMs you get are different to mine, and they are targeted and useful.
“We are doing a lot of stuff at the moment with Google tag manager which is a generic way of capturing how people are interacting with the website and the apps we have.
“It is pretty basic stuff but we still have a way to go.”
He is quick to add that he plans to very much honour the trust customers have in the brand.
“We are very careful with privacy and how we approach this kind of stuff and this is perhaps part of the reason we have been a bit tentative around this.”