All Things Bonanzle: An Interview with CEO Bill Harding
Fast-forward nearly two years, and Bonanzle is still a well-oiled machine that is slick to use and offers features that you just don't find on other online marketplaces -- in 2008 or 2010. Since my first-look at Bonanzle, this snappy little online marketplace has grown to boast 250,000 registered users, and it is now home to more than 3.5 million item listings.
So far this year the company has had pretty big announcements: it recently pulled in $1 million in venture funding and recently added Ontela co-founder Dan Shapiro to its board of directors (Ontela is the company that merged operations with Photobucket in December of last year).
Just as important as expanding and growing the company, Harding still has a vision for what Bonanzle is and should be. Despite changes and growth within the company, his vision for Bonanzle is still very focused on making the site as easy as possible to use, making it a cool place to buy and sell everything but the ordinary, and to continue supporting the sites very enthusiastic buyers and sellers.
Everything but the Ordinary
When I first spoke with Harding back in 2008, he couldnt stress enough that one main goal of Bonanzle was to make using the site as easy as possible. At that time registering to sell online by filling out a basic four-field form was a rather novel idea. Striving to make the process even easier, all a seller needs to get started is an existing Facebook or Google account -- thanks to one of several new features designed to improve Bonanzles simplistic approach to online selling.
In a recent interview, Harding said that continuously adding features to make the site easier to use, and further automation of the buying and selling process on Bonanzle is still a development priority. Several milestones from this year have helped fuel progress and growth in these areas. Harding said that the million dollars in Angel funding has helped Bonanzle build a bigger core team and, in turn, this has brought exciting opportunities for the company.
We couldnt do a lot of the common sense things like A/B testing and detailed analytics, and now we have more resources for progress in these areas, Harding added, referring to how the company is now able to take a more systematic approach to new opportunities, versus development guided mainly by educated guessing.
So What about Profits? Is There a Real Business Model?
In the early days it was apparent that the overwhelming support of Bonanzle from online sellers during the aftermath of the eBay strikes would help to keep this marketplace going, but also showed early signs indicating that it actually had a decent chance at turning a profit at some point -- unlike many of the alternative marketplaces that we have seen start up and shut down within the first year.
According to Harding, Bonanzle has been generating revenues since February, 2009. He also said that Bonanzles revenues have always been matched to the companys growth -- small but incremental since launch.
When you dont charge sellers much to use the site, you dont make much money, he said. At the same time, growth happens because repeat customers will come back and you get excellent word-of-mouth referrals from online sellers.
Bonanzle has grown incrementally, simply because the company did not use advertising and other funded ways to bring traffic to the site. To do that, it would have required Bonanzle to charge sellers more money to list on the site.
Currently, Bonanzle offers paid memberships that will give sellers extra perks, but this is optional for sellers. The site has fees locked in through 2010 for current users, and at a straight $10 fee to sell any item for $1,000 or more (with no listing fee), Bonanzle still offers one of the lowest final sale fees of any online marketplace.
Harding believes that the companys slower growth -- while less profitable for Bonanzle as a company --has kept the site less expensive for sellers and has been a big factor in contributing excellent word-of-moth referrals for the marketplace.
Bonanzle Plans for Seller profitability and Growth
As Bonanzle continues to move forward, Harding said that the plan is to keep the same momentum and core values that the marketplace was initially built upon. In the coming year Bonanzle sellers can expect to see continued platform developments and lots of new features, big and small, added on a frequent basis.
In terms of further fueling growth and revenues for the company, Harding said that the company realizes that it has sellers covered, but more work is needed in terms of buyers. To extend its reach, the company is turning attention to goals that will improve sales for sellers in the coming year.
A new focus will be put on increasing sales and seller growth by fifty percent -- allowing more online sellers to use fewer selling channels and earn better profits just from the Bonanzle marketplace. While remaining tight-lipped on specific details to increase sales of those who are already successfully selling on Bonanzle, Harding suggested that Bonanzle could increase seller profits while ensuring it wouldnt cost those sellers an arm and a leg to sell online.
Bonanzle has already proven it can beat the odds and be successful in a crowded online marketplace. With new funding and experience added to the companys team, it can now rely on more than just grass-roots development and educated guesswork to see the company through this new, ambitious goal for sales growth.
Harding said that the company has always focused on building the best possible product and letting it speak for itself. This, combined with showcasing the benefits of Bonanzles unique real-time buyer and seller communications, and implementing new buyer-focused features, is something that this CEO believes will help Bonanzle to meet new goals for growth and seller profitability.
Vangie Beal is a veteran online seller and frequent contributor to ECommerce-Guide.com. She is also managing editor of Webopedia.com. You can tweet with her online @AuroraGG.
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