Online Florist Lets Relationships Blossom Into Business
I got into the flower business selling bouquets at the corner of Pico and Normandie in 1984, just before I graduated from high school. From there, I got into pumpkin patches and Christmas tree lots. I opened my own store, Floral and Hardy, in 1985 in Beverly Hills, where I still have a floral design studio catering mostly to Hollywood celebrities.
In 1997, I took my business online when I realized that it was becoming far too difficult to compete with the supermarkets selling flowers cheaply and conveniently. We run Florist.com the same way we run the bricks-and-mortar business. It’s all about one-on-one relationships with customers, respecting their privacy, letting them know they’re working with true floral experts. People will tell you that you have to do everything very differently online, but I don’t buy that.
My biggest lesson is that an online business has to be run by people who know something about the industry, whatever it is. I met with venture capital firms, and the first thing they wanted to know was who was going to be my chief executive. They told me I needed to hire a big-name CEO and a CFO. They wanted us to move into brand-new office space and spend money for billboards on Sunset Boulevard. I came close to accepting $1 million in investment capital, but I decided I couldn’t jump through the hoops they wanted me to.
This is my company, but if I let investors take it over, where would I be in a couple of years? Out on the streets because my board of directors brought in some kid right out of college to be the CEO: Someone who doesn’t know the flower industry and has no business experience except what they heard their professor say. In the old business world, no one in their right mind would do that; and it doesn’t work in this new business model either.
The kind of money they want you to spend on advertising is outrageous. You can’t make money when you’re spending that much on ads. Remember when you were a kid and the ice cream truck would pull up? You’d be all excited, and you’d get out your money. But before you could really enjoy it, the ice cream would melt. That’s what I think happens with this out-of-control spending so many companies are doing: They melt all the money away, and they go out of business before they ever get to taste the ice cream.
From the day we launched Florist.com, we’ve taken the net proceeds and reinvested in our business just like we did with the retail shop. Business has snowballed, and we’re looking at 45,000 online transactions for the year 2000. We’re on track to bring in about $5 million in revenue.
About 70% of our business flows from our URL address and repeat business, and the rest of it comes from affiliate programs. We used to do a lot of online advertising, but we’ll spend less than $100,000 on advertising this year. Once we decided to stay private and we didn’t need to show someone how much we were spending on advertising, we discontinued a lot of the ads that simply were not paying for themselves.
When one of our competitors spends money to bring people to the Internet for their flowers, it brings us new customers. Flower customers are among the most particular consumers out there. When they don’t like what they see at our competitors’ sites, they type us in as an alternative and order from us. We hear that story from our new customers all the time, and once they’ve found us, they see we offer a beautiful site with great service, so they stay.
In 1997, I didn’t own a computer or know how to use one, but I realized that the Internet was where the future was going to be. I had a Web site called Floral and Hardy built, but it only took me one day to realize I was not going to be successful with it. No one was going to line up and find my shop online. So I went to an online shopping mall and set up there. The first day we were up was a Friday. Toward the end of the business day, we got an order from Spain. I was really excited, so I called up the customer and asked how he found us. He told me, in very broken English, that he typed in “florist.com” and was directed to my shop at the online mall.
The mall owner had not told me he owned florist.com, but at that moment I learned the value of a URL. The next Monday, I called the mall owner in Ann Arbor, Mich., to see if he’d sell me that URL. I was worried he would want $50,000 or more. But he said, “How about $15,000? And you can lease it for $1,000 a month and pay me $1 at the end of the lease.” I knew at that moment that our lives were going to change.
I have kept to the same long-range model ever since I got started. We’re just launching sales of gift baskets, tea pots and aromatherapy products, the kinds of things I would sell in my retail shop because I know my customers will like them. I was thinking about having other products too, such as live lobsters, but I decided I don’t want to be everything to everyone. The last thing I wanted was to have someone call up and ask me how to weigh a lobster because I’d have to say I don’t know. As soon as you say that, you’ve lost your credibility.
Another thing I don’t do is spend a lot of money on fancy bells and whistles for my Web site. We have an answer box that people can click on for things such as suggestions for anniversary gifts, but we don’t offer live help because we found that people don’t like the feeling that someone’s looking over their shoulder. For the most part, they want to shop from the privacy of their home, and they want to be left alone.
That’s the same reason I don’t send out a lot of e-mails to encourage repeat business. I’m an online consumer as well, and the last thing I want is to open my e-mail and see a bunch of junk ads in there. We don’t need to be a pain to get people back to our site. If we do our job well and take care of our customers, they’ll stay with us.
Our customers really like our privacy policy, which is pretty aggressive. Since we posted it, we’ve seen our sales spike. We don’t sell our customer data, and we don’t even keep detailed registration on them. It may be more convenient not to have to fill in their credit card numbers every time, but I don’t want customers worrying about us having their secure information and someone breaking into our server and stealing it. In the retail shop, we didn’t keep their credit card numbers on file, why should we do it here? Again, we stick to what was successful in the old model, and the same principles carry over to this business model as well.
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If your business can provide a lesson to other entrepreneurs, contact Karen E. Klein at the Los Angeles Times, 1333 S. Mayflower Ave., Suite 100, Monrovia, CA 91016 or at kklein6349@aol.com. Include your name, address and telephone number.
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AT A GLANCE
* Company: Florist.com
* Owner: Aron Benon
* Nature of business: Online
flower and gift sales
* Location: 9225 W. Olympic
Blvd., Beverly Hills 90212
* Founded: 1997
* Web site: https://www.florist.com
* Employees: 6
* Annual revenue: $2 million
