As the founder of Groundswell Media, specialising in e-commerce consulting and education, Grant Arnott has seen the inner workings of many online businesses. But it wasn’t until launching earlier this year that he has actually stood at the helm of one.
“It occurred to me that rather than analysing and consulting on e-commerce businesses, it might be a good idea to start one!” he says. So Arnott joined forces with partners Dean Godfrey (MD of Melway Publishing) and Nat Grigg. “We had a warehouse, we knew everyone in e-commerce and we knew all about best practice. We just needed a product to sell.”
“We chose coffee and tea because there was no-one doing it particularly well online, and being low on capital, it represented a low-cost entry into the market. Plus, we loved the idea of giving the very best premium coffee, tea and chocolate brands a national footprint, and it sounded like a store we’d want to buy from.”
Brewspace.com.au went live in 2013 but the company wasn’t officially launched until April 2014. Since then, it has become Australia’s biggest online marketplace for specialty coffee, tea, hot chocolate and accessories
Brewspace sells coffee from premium small batch roasters like St Ali, Proud Mary, Toby’s Estate and Market Lane, plus over 400 tea varieties from popular brands like Teadrop, Husk and Madame Flavour. It also sells chai, hot chocolate, coffee pods and accessories, including the popular Aeropress coffee machine.
Challenges and highlights
Arnott says one of their main challenges has been building an audience on a shoestring budget. “We have many customers, happy customers who buy repeatedly and tell their friends, but we want lots more,” he says. “Digital marketing costs are high so we have to be clever and use partnerships, PR and guerrilla marketing tactics to build our audience.
“Being a newcomer, every order is still very exciting. The biggest highlight is seeing our customer feedback on the website – it is overwhelmingly positive and delighting our customers makes the hard work very worthwhile.”
Having a strong digital media background with a focus on e-commerce has been invaluable for knowing how to set up an online store and to add an ‘X Factor’ with content and marketing, says Arnott.
“Dean and Nat both bring fantastic skills to the table too – though cartography hasn’t played as major role yet, Dean’s skills in running a successful business are incredibly important, and Nat has experience across marketing, events, editorial, admin and retail and brings a lot to the table. We have one full time employee, Simon, who also delivers the skills and hard work we need to be successful.”
“We want to not only be the top destination online for serious consumers of coffee, tea and chocolate, but also create a bigger overall market by stimulating more pride in choosing and brewing a quality product,” says Arnott. “Our motto is Honour The Cup and we stand by that as our vision.
“We look at Brewspace not just as an opportunity to be a retailer, but to stimulate a new market, and do for coffee, tea and chocolate what Masterchef and its ilk have done for fresh food and home cooking.”
For anyone thinking of starting their own online business, Arnott offers this advice: “You need a sustainable competitive advantage, and if you’re in retail, you need to create a great supply chain and look to vertically integrate with your own brands. That’s a next step for us – roasting our own coffee beans under a Brewspace brand.”
Blue Rock’s role
Blue Rock has been instrumental in helping to build the company, according to Arnott. For starters, it helped the Brewspace partnership come together. “The three of us were clients of Blue Rock separately and the grounds of the idea were formed with Blue Rock’s advice,” he says. “Ongoing, the monthly board meetings help ground us in reality and keep our grand visions and aspirations aligned with commercial sensibilities and realities. More than anything, having Blue Rock as our sounding board and mentors gives us great confidence to keep pushing ahead and doing what we do best.”