Building online traffic with Vroom
Thursday, 13 March 2008
Last Updated: Friday, 30 May 2008
By Jacqui Walker
The principals of fast growth online car hire business VroomVroom
Vroom.com.au, Peter Thornhill and Richard Eastes, share how they:
> Built traffic with search engine marketing.
> Created an innovative culture.
> Are planning global expansion.
Three years ago ex-NASA scientist Peter Thornton (left in picture) bought the small but profitable car hire website Vroom Vroom Vroom.
Soon afterwards he enticed young IT wiz Richard Eastes (pictured right) and his brother David to join him. The three redeveloped the site, changed its market position and used search engine marketing to build traffic and earn revenue of $31 million in 2006-07. Now they are pushing into the USA.
Thornton and Eastes share their tips on building traffic online, creating an innovative culture, search engine marketing and global expansion.
To listen to the interview with Peter Thornton and Richard Eastes,
click here (interview length 30 minutes.)
To download this mp3 file and listen to it later, right-click this link and "Save target as..." to your computer (Macs; option-click).
Jacqui Walker: You bought the business in 2005. What was it like then and how have you changed it?
Peter Thornton: Well when I bought it (with another partner), the website offered car rental deals like “Get a weekend, get an extra day free” or “$50 off or 5% off”. It was based in Australia and it mainly catered to leisure domestic in Australia and it was doing OK. When I say OK, I mean for a very very small company with two employees.
When Richard came on board just after I started up with this one partner, we went the way of XML, which is just interfacing directly into the reservation systems of each of the different global suppliers like Hertz and Avis and Budget and creating a comparison of the prices real time.
These prices fluctuate sometimes from minute to minute based on availability. All of the global brands have a yield management system and now car rental is a commodity just like bacon is or frozen concentrated orange juice. Prices do fluctuate and if you have to go to each of the different websites you might miss a deal.
So Peter you rebuilt the website because it had to do something more complicated than you were asking it to do before. Did you have technical skills? How did you go about that?
Yeah, well Richard has a lot of the technical skills in terms of the architecture.
Richard: Yeah, that’s where I kind of jumped in and thought “Geez, we need to be doing a lot more than that or we’re going to be dead soon.” So similar to what Wotif does for hotels, we brought a comparison engine that shows prices side by side and people can easily see which car they want because they can see the prices all at once.
So you bought off-the-shelf IT software?
I have a Bachelor of IT and so from a bedroom at my parents’ house day and night that’s where I spent a few months building it, and that’s what’s now used as a foundation for the search on our site.
Peter: And I used to work at NASA. I used to build satellites and I was a project manager and so I had project management skills and some technical skills that I brought to the table, but I saw us as a nice complement. We complement each other’s strengths really really well over the years and it really helped us.
And Richard your brother David is also involved in the business. What’s his role?
His role was starting off doing IT work, helping maintain the website, improving it, but I’ll be moving to another country soon and so he’ll be looking after the headquarters in Brisbane.
So how much did it cost to buy the company and then how much did you have to invest in the technology to get it up to scratch?
Peter: Well the company was bought for about £120,000 (from entrepreneur Steve Sherlock) so I suppose that translates into about $A300,000, but the good thing about it was it was a going concern when we bought it and it was already profitable, so we used the money that we earned to roll back into the company to make it work.
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