Our Microsoft Digital Champions initiative is now moving into the watch market with an examination of how Watchfinder is leveraging digital techniques to get its products before the eyes of an increasingly diverse customer base.
With a keen eye for the power of a good online presence and the benefit of in-house technology, Lloyd Amsdon told us more.
(1) Please give us a brief introduction to the business
Watchfinder are the leading retailer of pre-owned, luxury timepieces selling on average a thousand timepieces a month at an average 5,000 price point.
The business stocks over 3,000 pre-owned timepieces from over 50 of the worlds leading horological brands. Founded in 2002, the pure play business was one of the first alongside net-a-porter to sell luxury online and today boasts five retail outlets in London, Kent, Leeds and a concession in Harvey Nichols Knightsbridge.
Watchfinder had a record-breaking year in 2015 with an annual turnover of 55.5m, which is forecast to rise to 60m by the end of financial year [April 16] and has sold over 191.8m worth of watches to date.
(2) What have the significant growth milestones been in the last few years
After the crash of 2008, we took a step back, re-focused the business and concentrated on cementing our core business fundamentals of trust and ease of purchase.
This translated into a greater stock holding, bricks and mortar stores and significant investment into our service center.
Watchfinder opened its first bricks and mortar store within The Royal Exchange London in 2013. Today we run five physical retail spaces, a second store in London on Burlington Arcade, a concession within Harvey Nichols Kingsbridge and boutiques in Kent and in Leeds.
The stores give Watchfinder a physical presence for the consumer, instilling further trust and recognition for the brand. The proposition isnt to buy a pre-owned watch , but to buy a Watchfinder pre-owned watch .
(3) What inspires you as an entrepreneur/business owner, and how does that come across with your company
Im driven by doing the best I can, for Watchfinder to be the best it can be. I hope to think that same ethos is present with every employee at Watchfinder.
Our aspirations arent to be the best retailer of pre-owned watches, but to be one of the best retail experiences both on and offline. Luxury online is growing and Watchfinder aim to continue being at the forefront of the development.
Understanding our customers and the challenges to retailing pre-owned goods, we focused on the fundamentals of service, trust and knowledge from the start. The staff we employee are from within the luxury pool and the experience from the online or offline point of sale, through to the packaging and correspondence, is first class.
(4) What kind of obstacles are you encountering as you grow your enterprise
Stock funding has always been a challenging cash flow balance. It wasnt until 2014 that we felt ready as a company to take on external investment. Piton Capital and Berringea brought in 6.2m and a wealth of experience from within the technology and luxury landscapes.
This permitted us to make the next jump and double our stock holding to now stands at over 16m. A further 1m bank debt in 2015 continued to fund stock buying power.
(5) For a company that isn’t inherently technology based, how has a digital approach helped you to carve out a bigger market and acquire new customers
Watchfinders core is digital. Our brand equity online is unparelled. If you type Rolex into Google you will find Rolex as the second listing under the brand itself and above authorised retailers of the new product.
There are more Google searches for Watchfinder than there are for the leading retailers Watches of Switzerland, Mappin & Web and Watches.co.uk.
This traffic is the drive to our business. The shop fronts are an extension to the heart of the business we drive traffic from online to offline rather than the reverse. A 5,000 timepiece is a considered purchase. Today the public will research and not only quickly find us online but then recognise the Watchfinder proposition from choice through to standard – is unique and above the industry standard.
(6) How is technology helping you to overcome hurdles, and what are the challenges of implementation
Our use of technology is at the heart of what allows us to overcome the hurdles of scale and scalability.
Scale wise, we are the largest preowned watch retailer in Europe but we actually compete with the long established national chains and even the watch brands themselves to win new customers. We do this by being better at technology than them; by being better at SEO, better at PPC, better at the whole online experience than our competitors.
Then, using our own technology, we map this online experience to the offline reality of delivering on our promises to customers with understandably high expectations.
At every point along the way from a customer selling their watch to us, to our service centre bringing the watch back to as new condition, to the watch being publish on our site, found, bought, dispatched and delivered there is not a point where the technology we have developed as a company is not involved.
With well over 90 per cent of the technology we use, built by our in-house development team, our biggest challenge when it comes to implementation is time and prioritising the right technologies to have the development team implement.
However being so technology focused as a company allows us to scale quickly; weve gone from zero to four boutiques, 58 to over 120 staff and 4m to 20m of stock in less than two years.
Office 365 is useful because, as we on board more and more staff to the company,
I can provision new email accounts and software licenses in minutes without having to worry aboutpurchasing and supporting new hardware. Azure allows me to leverage technologies that were once only available to large multi-nationals with large
IT budgets.
(7) Do you employ any kind of flexible working, and how does technology fit into this
The vast majority of our systems are based around cloud technologies meaning that many of our staff could easily work anywhere.
Our head of communications, for example, works remotely across the country, rather than at our head office in Maidstone allowing her to quickly and easily reach her key contacts in person.
(8) What kind of technology tools can you not work without
Telephones and web browsers. Give us access to these and an internet connection and we can do anything! Oh and safes. We also use a whole host of Microsoft products at Watchfinder from development tools to running the website the main three being
Office 365, Azure and Visual Studio.
(9) What kind of technology would help you better compete with larger rivals
Once again this is a scale thing. Most of the technology we have used has allowed us, as a small company in the heart of the Garden of England, to become Fast Track 100 company with global reach. It works and is affordable at bite-size levels when you are just starting off; but once youve mastered the tech, it allows you to take big slices of the cake when you are ready. Im thinking pay-per-click advertising, scalable cloud computing and VOIP telephone lines.
In fact, I think when these technologies came along it was easier for smaller more agile companies to make use of them and master them, and until very recently, that bigger companies were on the back foot.
There are areas where being a rhino helps, things like buying TV, Radio and Outdoor advertising still skew towards those with the deepest pockets. But even here many of these channels are becoming digitised, making them more targetable, more affordable and better ROI.
(10) Whats next
Watchfinder has been profitable since its first year of trading. The company began international expansion in early 2010 with the launch of the French website. The .fr website is supported by a bilingual sales team and Watchfinder sell ten watches a week to French customers with minimal online adverting.
In early 2016, an American and Australian website were launched and an aggressive on and offline promotional campaign is planned.
Watchfinder are now looking to pursue a second round of funding to release majority shareholders and see the company enter new territories physically.
