Each week, we seek expert advice to help a small or medium-sized business overcome a key issue.
Before they walk down the aisle, stressed-out brides-to-be must often run the gauntlet known as the wedding show – a convention centre packed with photographers, dressmakers and other vendors.
"Why is wedding planning, which takes a year and costs $40,000 per couple, still stuck in this old traditional model where you go to a trade show booth by booth?" asks Angel Pui, who runs the website Weddingful.com.
"You don't shop for your car this way any more; you don't get your mortgage this way," says Ms. Pui, who founded Vancouver-based Weddingful, an online wedding-planning alternative, in 2010.
Members of the site – brides register for free – can browse vendors who are ranked based on user reviews. They can also make bookings on the spot. "It's wrapping that social element, word of mouth online, with commerce," says Ms. Pui, who is Weddingful's chief executive officer.
The seven-employee company makes money through monthly vendor subscriptions and commissions on sales. Although Weddingful has started moving into the United States, most of its business is in Toronto, Vancouver and Calgary. In Toronto, where the company has attracted some 3,500 vendors, more than 10,000 brides were using the site to plan to their weddings as of mid-November.
By the end of the year, Ms. Pui says, Weddingful aims to hit upward of $80,000 in monthly revenue, a figure that would push annual sales to $1-million. Over the past two years the company has raised more than $500,000 from backers including the Business Development Bank of Canada. But Ms. Pui says Weddingful hasn't decided how much it needs to gather in the next round of financing because it isn't married to any particular expansion plan.
She outlines four possible options:
- Developing partnerships with big brick-and-mortar retailers such as The Bay, which Weddingful has already started to do.
- Sticking with smaller local vendors.
- Growing aggressively in the U.S. By targeting 20 American cities roughly the size of Toronto and spending $50,000 in each one, Weddingful could become a $20-million company, Ms. Pui reckons.
- Focus on mobile apps that might do things such as help Weddingful members connect with vendors in person.
Ms. Pui knows that when it comes to shaking up the wedding business, her site has one big disadvantage.
"When the person uses Weddingful and likes the vendor online, they still have to meet," she says, describing the problem as complex. "Now that they've found the vendors, we don't want to just leave them there with a phone call, because they're still stressed in organizing. Could we help them with their mobile phone? Could we help them organize a meeting?"
The Challenge: How can Weddingful best disrupt the traditional wedding industry and grow in the smartest, most profitable way?
THE EXPERTS WEIGH IN
John Muffolini, technology, media and telecommunications industry lead, Deloitte LLP, Toronto
The issue with focusing on vendors is you've got to generate a lot of vendor relationships and a lot of volume at all those vendors to generate revenue. And I'm assuming that the slice of profit that the vendors are giving the website is going to be very slim. So can they generate significant volume at a bunch of key vendors? If they can do that, they can likely generate some profitability. But if it's very scattered and they have a lot of vendors, how are they going to monetize the different fees or royalties they're receiving?
There'd be a lot of value in having an app that would allow a bride to identify the vendor and set up meetings. And then the company could track which brides actually go to those vendors and negotiate some type of fee. Even if they don't close a sale, there should be some compensation or fee by the vendor for the ability to generate leads and schedule meetings. If they can be a planning system for brides, I think there could be definite value and fee generation from that.
I would think that what they've done here in Canada they can scale to the U.S. But the issue will be what infrastructure they have, how scalable it is to a number of users in multiple locations. Are there any competitors in the U.S.? They should find out and understand what the competitive landscape is.
Lyn Bryan, vice-president of sales and a partner at 6S Marketing Inc., Vancouver
I did see the Weddingful brand in my journey to getting married. But it didn't strike with me immediately because I didn't really understand what it was. It's somewhat of a new concept. (A TripAdvisor for weddings?)
Whatever it is, I think that messaging was missing for me as a bride in recognizing what a useful resource it is. So maybe go back to the drawing board in terms of holistic messaging and meeting the frustration of a bride.
Maybe they need to better present the overall messaging and the objective and the call to action. What are the main frustrations that this is going to help solve? There isn't anywhere it actually talks directly to the pain points of the end user.
There is something with wedding conventions where people like to see things in the flesh. Because it's such a personal purchase, they like to form relationships with the individual vendors. Is there a better way to "persona" each of the vendors? Is there a better way to allow the vendor to make a human connection with the bride? Maybe that's where the app comes in.
My first intuition is if they've figured out a model that works, then changing horses to start reinventing themselves as a mobile app company for weddings seems like a potential diversion of resources.
They should scale it up and go to different cities. As they do that they'll build their brand, they'll continue to build traffic, and that gives them a great platform upon which to build. Assuming that the core business is essentially profitable or it's got the right potential, then it makes sense to continue to roll it out.
Do their customers really want to do bridal registries through the Bay? If no one's ever asked for that, it's probably not the best place to focus. Do their customers really want an awesome mobile experience? Or are customers happy with what they're doing and they just need to go spread this wonderful experience to other customers in other cities?
Is the physical meeting the big barrier? If it is, I don't know how much more value is created beyond, "Here's an e-mail address and here's how you get connected." Don't build a mobile app just because you can build a mobile app. Think about how it adds value to customers' experience in a way that's very unique and differentiated and is consistent with the value proposition of the overall site.
THREE THINGS THE COMPANY CAN DO NOW
Sharpen and strengthen its message to customers
A call to action that better explains your value proposition may help win more converts to this new way of planning a wedding.
Use its proven business model to expand into the U.S.
If you've got a system that works, don't mess with it.
Focus on key vendors
Cultivating a relatively small number of vendors that yield significant revenue could make the business more profitable.
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Interviews have been edited and condensed.