After a decade of working in digital retail, Sydney entrepreneur Nick Lavidge’s frustration with online marketing agencies grew so big he turned down an opportunity to work for US reality television celebrities the Kardashians and launched his own business.
“It wasn’t like Kim called me [and said], ‘I got Kanye here’,” Lavidge told SmartCompany.
Lavidge was asked to run the e-commerce platform for the popular family’s fashion label, the Kardashian Kollection, which contributes to the Kardashian-Jenner family’s estimated US$300 million ($398 million) fortune.
But so convinced of the problems of traditional marketing agencies, Lavidge instead forked out $8000 and started building his business, Alley, in a bid to break the internet in his own way.
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The small web agency’s sole aim is to give online retailers better and more effective strategies to find and retain customers.
“I looked at the agency model being broken,” Lavidge says.
“Any type of marketing should tie back to revenue and return-on-investment.”
Alley uses a combination of predictive intelligence and big data to provide clients with insights and optimised marketing campaigns tailored to reach the right customers for conversion.
Since launching in 2014, the company has run more than 400 campaigns around the world.
Alley turned over $3.5 million last year, a figure the company says it’s on track to nearly triple this year.
Lavidge says Alley’s success has come from three key areas: finding the right market fit, investing in people and using technology to accelerate the company’s growth.
“Now, we’re just continuing our expansion internationally and domestically,” he says.
Finding market fit
When Alley started, Lavidge says he was a one-man shop working with contractors to operate a warehouse, web development, customer acquisition, customer service and photo shoots.
But nine months in, Lavidge believes he’s found the company’s sweet spot.
“We were the best at increasing our clients’ revenue,” he says.
Honing in on this strength, he’s now focused on building out the product and team to grow this further.
“It takes time to find market fit,” he says.
With the ultimate aim of figuring out where you can provide the most value to customers, Lavidge says businesses should continue testing out new angles to find their fit in the market.
“There’s a lot of value in the pivot as long as you’re making pivots not jumps,” he says.
Lavidge has also worked to ensure Alley grows at a manageable pace.
“I didn’t take a salary for the first while,” he says.
“We grew things scalably and ran lean even with a few wins.”
Investing in people
“For us everything is people and technology,” says Lavidge.
At Alley, Lavidge says they find the right people through a rigorous interview and testing process.
“The method was developed by executive teams and a topgrading series of questions for each position that narrows down the core values of each role,” he says.
In addition to a 30-minute phone screening and two detailed in-person interviews to discuss work history and culture fit, Alley applicants have to sit an at-home exam that uncovers whether they can really walk the talk on strategy, marketing and optimisation methods.
“Talent can be taught, culture is much more difficult to teach,” he says.
For a company expecting $10 million in turnover in the next year, the Alley team is quite small with barely 10 full-time hands on deck.
Technology plays an important role in helping them achieve this, says Lavidge.
“We invest in tech to make sure we’re as efficient as possible and maximising our output,” he says.
“If there’s something inefficient with either the department or the role, that can be automated.”
With the likes of Receipt Bank and Shoebox starting from $30 a month, Lavidge says there are many ways for small businesses to improve efficiency.
“There’s a lot at your finger tips now for running your business,” he says.
“I’m constantly looking at how can we make things more efficient so I can spend more time building value for my customer.”
When spending on tech, Lavidge says choosing what and how much you invest in should come down to answering the following question.
“How you can do more in a day?” he says.