All Together’s Three Things podcast is back for another season and we’re kicking it off with the CEO and Co-founder of Bloom & Wild, Aron Gelbard. Aron founded Bloom & Wild in 2013 alongside Ben Stanway. Since then, the company has gone from strength to strength, taking the online flower delivery industry by storm.
All Together Co-founder, Jamie Mitchell, sat down with Aron to unpick his astonishing success. From his relentless focus on the customer, to his masterful use of scale, Aron explains in depth how Bloom & Wild has managed to usurp significantly more established competition to become the market leader in the UK and Europe.
Transcript
Jamie Mitchell:
Welcome to All Together’s Three Things where we explore the extraordinary careers of some exceptional CEOs and founders. And we demand of them three things, three pieces of clear and actionable advice that they recommend you implement in your business today. Now, after a lengthy summer off, this is the first episode of Series Two. So it feels only right that we welcome the founder of one of the UK’s most exciting scale ups, Aron Gelbard of Bloom and Wild. Now, I’m fairly convinced, knowing our audience, that everyone knows of, and probably most have been a customer, or are customers of Bloom and Wild, but we’ll get into the story of Bloom and Wild in a minute. It’s what I might call a proper scale up. You’ve raised over 125 million pounds, I reckon?
Aron Gelbard:
We have, yeah.
Jamie Mitchell:
Five rounds or so. 100 million in your series D?
Aron Gelbard:
That’s right.
Jamie Mitchell:
And some debt.
Aron Gelbard:
And some debt.
Jamie Mitchell:
Blimey, that’s serious, isn’t it? But more importantly, you’ve got an award-winning extraordinary product and service that has upended an old-fashioned, an old-fashioned industry. Were you playing with flowers as a child, are you, are you naturally inclined to be to be here today, or, as I suspect, did your love for flowers come out of a business plan idea as a sort of former management consultant?
Aron Gelbard:
Neither of the above, actually. So, I am here because I care very much about the quality of experience that we can give people in this business and the way that makes them feel, the feedback that we earn when we do well. And the criticism that we get, which we can act on when we did badly. I’m very driven by people’s feedback, what people say and what they think and acting on that. And that made me try to work hard, you know, as a management consultant and before. But the more I thought about it, the more I wanted to do something where we were going to really – I and the team that I would build – would really live or die by that response to feedback. And that’s what brought me to the flower industry, which is such an emotive purchase category, people are trusting us a few times a year with expressing their most important emotions to people that they care most about. And so you are blessed with this disproportionate amount of feedback for how much money people are spending. And that’s something that’s a well that I wanted to work in.
Jamie Mitchell:
I mean, it really is, you set yourself up in the world of DTC for that real time feedback and knowing your customer perhaps in a way that many other businesses don’t. And we’re going to come on to…I really want to spend some time talking about the brand and the customer and the experience and the business. But can I just get to the elephant in the room straight away in terms of the world we’re in today? You know, All Together was founded one day after lockdown 2000 and, I can’t remember the date now. But anyway, the first lockdown.
Aron Gelbard:
Yeah.
Jamie Mitchell:
Just a bunch of CEOs and former CEOs getting together saying, ‘how can we help?’ It was a moment of crisis that, within a few months, became a bit more positive in terms of how we were helping and supporting people. But today feels eerily similar, in many ways, with small businesses and scale ups. This is a near-perfect storm of inflation and interest rates and a tech credit crunch from fundraising. You’ve got the potential, or probable, global recession coming. How that impacts the UK? To be determined. How do you feel about these economic times? And how resilient are you feeling about the business going forward?
Aron Gelbard:
So I totally agree with you that this is a concerning set of economic circumstances and has been for some time now. We have certainly seen inflation in our own cost base, we’ve seen some groups of customers start to scale back how much they spend. So I’m definitely aware of this. But by and large, our businesses so far – and I hope that this will continue – have been resilient. We are continuing to send out hundreds of thousands of bouquets of flowers and plants every month across Europe. And that really hasn’t changed, despite macro conditions. I think partly this is because of what we’re doing and the role that we’re playing in people’s lives; we are mainly a gifting company, that people are using to express emotions to each other. And they do so relatively infrequently. And those emotional expressions remain important. People might cut back on something that they’re spending on themselves, that costs hundreds of pounds a year. But people cut back a lot of things before they stop wishing their mum, happy birthday or happy Mother’s Day, which is really our core.
Jamie Mitchell:
It might affect average spend, perhaps, or basket, whatever the measure is, I mean, perhaps we still continue to gift but do we spend less?
Aron Gelbard:
We are trying to help you get great value for less. So actually, we have increased our prices as have everybody, and we’ve seen customers sort of accept those price increases because they’ve been broadly in line with inflation that customers are experiencing elsewhere. But we’ve been reinvesting in new, more entry level products and ranges both within core flower products but also outside of flowers. We’ve been expanding into standalone other gifts, like chocolates, confectionery, scented candles. And those have proven quite popular. And some of them are available at a slightly cheaper price point than our entry level bouquets.
Jamie Mitchell:
You also do Christmas trees.
Aron Gelbard:
We also do mini Christmas trees.
Jamie Mitchell:
Good time to mention that, believe it or not, it’s around the corner. And you’ve been doing them for a few years?
Aron Gelbard:
We’ve done mini Christmas trees for a few years now and also through the letterbox.
Jamie Mitchell:
Sorry, I have a quizzical look on my face.
Aron Gelbard:
You have a quizzical look, they are 45 centimetres high, about one and a half feet. And if you think about putting a Christmas tree in your car, it goes in a net and then you take off the nest springs out to life. So the same thing happens with our Christmas trees when you take them out of the box.
Jamie Mitchell:
That’ll be one for the kids to enjoy. But sorry, going back to this a second. I hear that maybe flowers have a certain gifting resilience. I hear consumers accepting certain things in terms of today anyway, in terms of cost price increases. I did read that one of your competitors over the summer started redundancy rounds, right? And there are a lot in the tech industry for whom they’ve had to adjust strategy from top line growth to focus on bottom line. Are you facing these kind of questions? I mean, you did actually have a superbly profitable year.
Aron Gelbard:
Yes, thank you.
Jamie Mitchell:
But I assume that was a COVID blip, or maybe not?
Aron Gelbard:
So, a few thoughts on that. I don’t know the ins and outs of our competitors. We are focused on profitability, like many other companies, for a couple of reasons. Firstly, as you’ve mentioned, the fundraising environment is more challenging right now, the performance of all businesses is more uncertain. So, if you are relying on hitting certain performance metrics, and then being able to raise more money, if you’re not profitable, then there’s always a risk that in these volatile times, you don’t hit those metrics, and therefore you can’t do so. So, I think controlling your destiny at times like this is important. It’s also what both current and potential future investors are increasingly looking for and have been over the last few months. And as you say, it’s something that we’ve done before, albeit during COVID. But actually, our core business in the UK, which is about two thirds of our group, has been profitable both before and after the COVID period, as well as during. That remains our sort of profit engine now.
Jamie Mitchell:
By the way, congratulations, just in that regard.
Aron Gelbard:
Thank you.
Jamie Mitchell:
I mean, it’s it’s a significant achievement. The business is older than perhaps we think from the outside. You founded it 2013?
Aron Gelbard:
2013, yes, we’re nearly 10 years old.
Jamie Mitchell:
I mean, that’s extraordinary. I’m going to come to this question of the journey in a second. But just before I do, I just want to go back to this question of how else you’re thinking about the the current economic times, by the way, the chief economist at Investec, that I did a little Ask the Expert podcast with this morning, said, ‘Don’t panic and keep liquid’. He had a third one that was perhaps, not quite as catchy as that, but those, those two were very material, and we just touched on the keep liquid, or at least have one have a very clear eye on it. And don’t panic, I thought was a good message, because for him, it will be a mild recession next year, different economists have different views. But you’re keeping calm, you’re carry on. Are you preparing for the shocks that could come in some way or another?
Aron Gelbard:
Absolutely, staying liquid, I think, is the right way to prepare for shocks. And I would certainly advise other people listening to try and get your business profitable, to think about some of the growth versus profitability trade-offs, to think about how many sort of like expensive or slower return on investment projects you pursue at the same time, at a time like this. I’ll come on to that a bit more as we continue this discussion. I’m not an economist, I don’t have a view on length or depth of any recession but I do think you need to be prepared for it. And therefore, what we’ve tried to do is focus on profitability, try to do a smaller number of the most important things. And then really be in a position where we can dial up or down how much we’re investing and measure the impact of where we do choose to invest – in brand performance marketing, extra investment in tech, investment in price, investment in entry level products – and really be diligent about gathering data and measuring our returns and changing accordingly.
Jamie Mitchell:
I think that’s a brilliant example of how to do it. Some might say it’s easy for you to say. Last year, you took in 120 million quid of cash. I would say, well done you. You hit a moment, post COVID, which is quite extraordinary. I mean, you pretty much tripled your business during COVID. Is that right?
Aron Gelbard:
We did triple.
Jamie Mitchell:
Amazing.
Aron Gelbard:
Thank you.
Jamie Mitchell:
It must have been scary as hell.
Aron Gelbard:
Yeah, it’s terrifying. So, we didn’t know what was going to happen, we didn’t know if we were going to be, at the start of COVID, able to carry on selling, if we were gonna be able to carry on finding the flowers to sell, whether we were going to be able to continue to produce safely whether the government was going to even allow bouquet making to continue. We were fortunate that it did but this was all very uncertain at the beginning. And we were sitting on large amounts of stock, large amounts of orders, and not knowing if we’re going to be able to fulfil, so we also had to reengineer, our supply chain. In those early days as well, we wanted to make sure we weren’t exposed to changes in the COVID situation in any one country. So rather than having each bouquet comprised of flowers from multiple different countries, we started to create sort of lanes and different sourcing countries would feed into different bouquets so that if we lost the country, we wouldn’t lose more bouquets than necessary. I mean, this is a big change to that we had to put in place right at the start.
Jamie Mitchell:
That’s extraordinary. The number of international businesses I’m involved with is limited at the moment, certainly during COVID, so I hadn’t really thought about how you had to sort of navigate the supply chain issues in different countries, quite extraordinary. When did you realise that this might be quite good? People are stuck at home and still want to celebrate things and they can’t go to the flower shop?
Aron Gelbard:
I guess we didn’t think about it as good and I think that was really important culturally here. And maybe I’ll handle that first. We saw that there was additional demand, but it wasn’t the way that we wanted the business to succeed. One of the first things we did was making sure that we were sort of handling this situation sensitively in the right way. Early actions we took were extending our staff discount to all frontline workers, we raised a six-figure sum for the national emergencies trust Coronavirus appeal. So, we really leant into some of those societal responsibilities. But even before lockdown was announced, it was actually just the weekend after Mother’s Day that it was announced, which is a really busy period for us. But even in the run up to Mother’s Day, we saw that order volumes were accelerating more quickly than we expected. And we thought that the reason why was that people were being discouraged from going to visit their mums that Mother’s Day. And, the big thing that we learned from our customers during the two main lock downs, that spring of 2020 and the winter of 2021, was that people were using our flowers almost as a substitute for a hug and they weren’t able to see their loved ones in person. A lot of our recipients tend to be people’s mums, they can be grannies, they can be older, they can be more vulnerable.
Jamie Mitchell:
I’m feeling the emotion of that. There are many businesses that did better during lockdown for reasons of just who they are and what they did. But I can hear from you that you did better because of the emotional struggles people were having as much as anything else. So I can see why you’d want to lean into it and why you want to to play that support role. But you said you talked about it from the team point of view as well. How did this play into it? How much was being bottom up driven by your team in terms of how can we help here? How can what can we be doing? Versus top down? Sort of, from yourself and other leaders?
Aron Gelbard:
It’s both because I think we’re culturally quite aligned here. We’ve got strong values, we have four values, one of them is to lead change for good. And another one is care wildly.
Jamie Mitchell:
Let’s just get all four down for a second because I do love a chat about values and culture.
Aron Gelbard:
Lead change for good, care wildly, think deeply, act swiftly, and then stay open, be curious.
Jamie Mitchell:
So much packed into those! I really like think deeply, act swiftly because I’m a former management consultant as well. And there is a tendency for me to get into analysis paralysis. I can’t call that thinking deeply forever, you know, you got to stop at some point, you have got to act. And when you do decide how to act, you do have to do it decisively and swiftly. I do like the phraseology of it, you’re not throwing the baby out with the bathwater here, you’re keeping that deep thought. And then curious minds?
Aron Gelbard:
On the on the stay open, be curious, this one… So one of the things to link it all together, as we saw growth during COVID, we also realised a couple of things. Firstly, we would be able to invest some of the profits that we were making into expanding our business outside of the UK more rapidly, and also that we’d be able to raise money to help with that. And so we thought about how we do this. And one of the decisions we made was to acquire another business in the Netherlands called Bloomon. And the word curious comes up really regularly. It’s a word that Dutch people use a lot I’ve learned as I’ve been spending 18 months now doing business in the Netherlands. And actually, it’s a word that I really value the use of because I think, as we’ve integrated in other business and learned to work together, that openness and curiosity has been really important. It’s meant that people have sort of let go of entrenched positions or views that they’ve had and we have made a better company as we’ve integrated two businesses – we went on to buy another business as well, which we have not yet integrated.
Jamie Mitchell:
There’s so many questions I’ve got about sort of this organic versus acquisition growth strategy and the challenges of of both in scaling, but I want to come back to it in a second if I can. I want to just spend a few minutes on this idea of the proper scale up. So the OECD definition of a scale up, that pretty much sits beneath the scale up Institute and things like this, is 20% or 25% growth a year for three years. Your last three years is 70% compound, aggregate growth, so pretty sizeable. Was it always your ambition to build a big business?
Aron Gelbard:
Yes, but I didn’t think it would get this big. I wanted to create something that would reach meaningful scale. We also raised money quite early on and I sort of felt that I had made a promise to people that I would give them a return when they trusted me when we basically had nothing. It was barely a business at all. So I did want to sort of repay the faith that people showed me, and that integrity of how I deal with people is important to me. I never imagined that we would acquire businesses in continental Europe, when we were starting, though. In some cases, they are great businesses that started at a similar time to us and went on a similar journey. I didn’t imagine that we’d become the European leader in our space in less than 10 years.
Jamie Mitchell:
But you were very clear on wanting to be number one in the UK?
Aron Gelbard:
Yeah, of course, from day one, from very early on.
Jamie Mitchell:
You’ve sort of knocked Interflora off their perch, but I’m really intrigued these days by this question of why? What’s big enough? Why scale is important. Some business models require scale, a certain level of scale, most business models require a certain level of scale for sustainable profitability. Beyond that. Is it about one’s ego? Is it a measure of success of our efforts? Is it the impact we’re having and a desire to keep on delivering that? Is it the pressure of investors saying, ‘This is the one that could make my fund go’?
Aron Gelbard:
It’s a few things, but for me, it’s certainly not ego.
Jamie Mitchell:
We’ve never properly met before, but you don’t appear to have a sort of big ego.
Aron Gelbard:
Thank you.
Jamie Mitchell:
And I’ve heard lots of nice things about you from people I’ve spoken to, and I just wanted to throw it out there. But what is it?
Aron Gelbard:
A few things, I guess. We’re trying to make the flower buying and receiving experience much better than anybody else out there. And in order to do that, more scale means that we can invest more in our technology, which is a fixed investment, which does make the experience better, we can attract better talent because we can afford higher salaries. And so we can, again, use that to contract better managers and leaders, which means we can train and nurture better people at earlier stages in their careers, all of which makes the experience better. We can afford to make investments that we can spread across our scale. So this is investment in innovation and automation of processes.
Jamie Mitchell:
It’s almost like you can’t do the long to do list of things you want to do unless you continue to grow in this regard.
Aron Gelbard:
It all makes for a better customer experience. And then as you say, it’s also for more people. So there’s both make the experience better. But if you think about it, there are a billion flower transactions around the world every year, the average net promoter score in our industry globally is around zero. So our industry might as well not exist because we exist for people to express emotions to each other,
Jamie Mitchell:
Now this is interesting. So I saw this fact somewhere, your average net promoter score…
Aron Gelbard:
Around 80.
Jamie Mitchell:
Is extraordinary.
Aron Gelbard:
Thank you.
Jamie Mitchell:
The entire industry, we know, we’ve all – pre you, and pre maybe some of your other competitors – but pre the guys coming in saying ‘this can be done better’, it was a lottery, right? You call up, whether it was Interflora or somewhere else, or your local flower shop, there was a lot that could go wrong and often did go wrong. So, I can see I can see how that is a joyful thing to deliver. The other thing I really like about your business, correct me if I’m wrong, you have an element of cut the middleman out or you did perhaps early on in your pitch, but you didn’t say, ‘and therefore we’ll make more money or go for value and do cheaper’. You just said, ‘We can make a better quality product, a product that lasts and a product that rewards people better’, is that a correct interpretation?
Aron Gelbard:
So there’s a few things. I think it’s giving the customer a good price. I think it’s giving the customer a product that lasts a long time. I think it’s giving the customer what they ordered rather than something somewhat similar to what they ordered, which are more sort of indirect supply chain results and more frequently. And then I think it’s offering something more sustainable, which maybe we’ll talk about as well because each middleman adds waste.
Jamie Mitchell:
Scale is such an interesting conundrum. I think growth for growth’s sake, which we sort of live in a world of growth for growth, without really knowing what the purpose of growth is. It’s an input to some outputs. I want to talk about it from the point of view of what changed? It may be an unfair way of saying it, but you didn’t think you’d be this big. I also don’t think investors looked at you necessarily and saw you as a traditional venture backable business. I mean, it’s flowers. It’s real. I mean, it’s so it’s not SaaS software. It’s going to be harder to scale this thing. The very fact that Piper – who are a private equity house, albeit one that was moving into more venture and playing in between – was your series C suggests to me that you weren’t this kind of go for growth, venture opportunity, and that you were more interested in growth for many other reasons than just expanding at pace. You’ve got the big boys in now. I mean, Index has got to be, if not the best one of the top three VCs in Europe, General Catalyst from the US, one of the biggest names in VC there, and they back businesses and they want super duper growth. It feels to me that was a slight change in mentality.
Aron Gelbard:
That’s right. I think we realised that there was an opportunity to go from building the biggest business in the UK with some international footprint in the flower category, to building the go-to way for people to express emotion across Europe, and maybe one day beyond. And so our vision became materially bigger over time, and that we could do that through M&A, as well as organically. And so our vision became materially bigger, both in terms of geographic ambition, but also in terms of what product categories we’d like to play in. And our approach to how to achieve that vision and taking the plunge on going down the M&A route, rather than just sort of starting from scratch in each country and building a brand from nothing, I think really appealed to some fabulous investors as a way of really addressing the problems of this category and the consumer experience that it’s providing at large scale.
Jamie Mitchell:
I think every wannabe entrepreneur, every early stage entrepreneur has some decisions to take about how fast they grow, how much money they raise from the venture community. And I think it’s historically been posed as a question of giving up control and going for growth or having a more modest path to profitability, and sustainability without the venture capital world. But I think it’s a lot more complex than that. So had you come up with the decision that the way to grow this next phase would be acquisition? Or were you doing a fundraising? I’m asking you to get real in terms of what happened: you just closed a 140million pound year, in March 21, you had a phenomenal…I mean, I’m imagining the board discussion right now, ‘This is the time to raise money. Let’s go out to the market.’ And of course, you’re going to sort of knock on the doors of the greatest. Where did the M&A strategy come from, out of those discussions with investors for growth, or had you and your your board decided we need to grow by buying and therefore, we need to go get cash?
Aron Gelbard:
The latter. So, we were already thinking about trying to accelerate international expansion through M&A and we’d already identified Bloomon and Bergamotte as the right businesses to acquire in order to do that.
Jamie Mitchell:
By the way, it’s the right business answer: do your strategy, then raise the money for it.
Aron Gelbard:
I think we would have not been able to compellingly raise the money without this strategy because the on the executive summary of the pitch was our vision to build a Pan European leader. We plan to do this through acquisition of these businesses and this is why we’re raising the money, because at the time, in particular, the business was highly profitable. So the money wasn’t just to sort of spend on Facebook ads, it was raised deliberately with a view to acquire these businesses and build a materially bigger platform and then, also going back to making the making the proposition for customers better, we didn’t just acquire scale, we also acquired much more sophistication in sourcing, in bouquet-making and using automation.
Jamie Mitchell:
Did you get some new thinking on brand? Because one of your acquisitions has been big on pop up stores, which you’re doing a bit of.
Aron Gelbard:
That’s right, two brands with pop up stores, subscriptions contemporary design plans, so lots of things.
Jamie Mitchell:
Okay, let me let me put the cards on the table, I think scale is great. I think scale is important. One of the things that happened with my experience at innocent – and I was a few years there compared to the wonderful journey that business has had – but as a sort of real category leading success story, one of the greatest effects was how other businesses span out of it, other innovations came out of it. Management capabilities and skills diffused through industries from this leader. I think when we get big and successful, internationally – so able to compete in different markets – the UK benefits in many other ways. I’m a big fan of scale for that rationale. And in the US, it is relatively easy thing to do. I say that, that’s terrible. And actually in flowers, it’s not. And I don’t think we want to bore people with the challenges of the flower industry in America, although it must feature in your board discussions, but generally scaling in the US? Big homogenous market, a lot easier than scaling across Europe. And in Europe, broadly, you can do it organically, or you can take the decision you’ve done of the acquisition route. Pros and cons? When is it right to go one way or the other? What was it about the organic route that wasn’t working for you? And what are you worried about with the acquisition route?
Aron Gelbard:
So the con of the organic route is that your traction in one country isn’t necessarily replicable in other countries. And actually, we saw that. So we did start by expanding organically into Germany and France. And actually, we have not made an acquisition in Germany, we are now the number three player in our category in Germany. And I think we can organically grow from here to be the market leader in Germany over the years ahead. So organic international expansion is certainly possible. When we open France at the same time as Germany, we saw that our German business from day one was five times bigger than our French business. And that remained the case, the entire time that we scaled it and the market size is about one and a half times more in Germany than in France. And we just had worse product market fit. And the more consumer research you did, there a few things with some operational challenges we face, but a big problem was that we weren’t French. It turns out in France there’s a very strong sense of pride about local provenance. And French people don’t drink a lot of imported wine or eat a lot of imported cheese.
Jamie Mitchell:
I’m surprised that flowers ranks in the same way as wine and cheese for the French.
Aron Gelbard:
Well, so am I, or so was I when I started and this was maybe something we could have figured out before we went into the French market. But we realised that we were not going to build a serious scale business in France with the Bloom & Wild brand. So it made sense to to find likeminded entrepreneur who had a similar ethos and approach to us who we would enjoy working with and where we would could go after this opportunity.
Jamie Mitchell:
But that wasn’t the only strategic option. I mean, you could have retrenched, built a new plan and strategy with a French brand and a French team and, and gone again. I mean, I say that simply because I think it’s reasonable to say, from my innocent experience, those first international expansions were not executed well and it was the second attempt that really nailed them from all the learnings. I think when you’re getting into a new market, obviously we don’t know a lot of things we don’t know about customers, and we do the market research. But I think for consumer businesses in particular, you lose a little bit of the part of your brand that stems from the fact you’re a startup in this country. It’s sort of the network, the effect of all the people who know about that very early day. You get those real loyal, early vocal customers that do most of your marketing for you, harder to replicate that as you enter an international market.
Aron Gelbard:
And that’s a great reason to do M&A because you do get that benefit of local community and followership and we have retained the brands that we’ve acquired so we still trade as Bregamotte in France, in fact we only trade as Bergamotte in France. We’ve retired the Bloom & Wild brand from all of France.
Jamie Mitchell:
So what have you done? Plugged the tech into Bergamotte?
Aron Gelbard:
In the case of Bergamotte, not yet, and that’s something that we’ll consider doing in the future. In the case of Bloomon, yes, we have integrated the technology. We’ve also integrated operationally so we are actually Bloomon was more advanced than Bloom & Wild on the sourcing and bouquet production area and some of the technology associated with that. And we’re now using Bloomon’s technology across our group.
Jamie Mitchell:
So you bought not just a business in that case, you bought some understanding, some knowhow and some tech. And as I said, in France you bought the experience of pop-up retail.
Aron Gelbard:
Plants, luxury, proposition, same-day delivery.
Jamie Mitchell:
I once worked with someone who had done a lot of merger type stuff as a consultant. And they kept talking about the post-merger acquisition something or other, but basically how these things fall over. Post-merger acquisition integration, something like that. It’s a terribly corporate type of phrase. But essentially, here you’re putting two cultures together. And it’s something in the world of start-ups where culture is very bespoke, custom, and unique to organisations, hopefully, especially consumer ones. You’ve got to fuse some very different cultures. How? And I don’t suppose this is something you’ve necessarily done before, either. But how do you approach that? How have you gone about figuring that out and not screwing it up?
Aron Gelbard:
Oh, it’s been really challenging. It’s been probably…definitely one of the most challenging things that we’ve had to do. And actually, when we acquired Bloomon, we announced the deal in April 2021. So we negotiated the entire deal during lockdown when travel to the Netherlands was not permitted. I actually first visited-
Jamie Mitchell:
You bought them blind?
Aron Gelbard:
Yeah, I first visited Bloomon five months later, in September 2021. I was allowed to go to the Netherlands for 12 hours, that was the maximum. And we knew the team, we’d actually met before COVID had started, but still. But actually not being able to bring people together and show people each other’s faces and just be this sort of voice at the end of a zoom line made it more challenging. The way that we have – and I wouldn’t sort of declare 200% victory here – but I do think the level of trust in both directions has become much greater now. And I think the big thing that’s driven that has been that we’ve spent time together, we’ve worked in teams on problems where we’ve rolled our sleeves up together with people that were at Bloomon before and people that were at Bloom & Wild before. We’ve adopted new shared values that are neither Bloomon nor Bloom & Wild’s legacy values, They’re ones that we’ve co created from scratch and I think people therefore identify better with them. I think these things, and that ability to work together and let your hair down together as well now that it’s possible to do that in person, really does make a difference.
Jamie Mitchell:
Co-creating values. I mean, you’re sitting down, you’re saying what kind of culture do we want to be together? But you can’t do that every time you acquire a business if this is still your your goal, your growth strategy, can you?
Aron Gelbard:
No, you can’t do that every time you acquire a business. But I think now we’ve gone from being one business to a platform. So we formed the notion of Bloom & Wild group as a sort of umbrella. And Bloom and Wild group has got group values that have been co-created by three brands that are members of that group. I think if a fourth brand were to join our group one day, firstly, in terms of the proportion of the group that it would represent, it will probably be a smaller proportion than the proportion of the group that Bloomon represented where we sort of doubled our headcount overnight. And secondly, I think, because these values are already representative of multiple individual brands, I would hope that they would resonate better with a fourth or a fifth brand than if brand four or brand five were just asked to adopt brand one’s values and so we therefore don’t need to re redo it every time because these are group values rather than the values of an individual subsidiary.
Jamie Mitchell:
That’s really interesting and it’s going to perfectly lead us on to the third area I want to touch on in terms of brand, but if I may just say, unpacking and unpicking that discussion is going to take me a while in terms of what I’ve learned about when international expansion can be done by acquisition versus organic. For anybody at the stage where they’re thinking about international, and if it’s the right thing to be thinking about, you know, certain business models this is going to work for as a route certain ones it won’t I’m sure. But the truth is, it’s not easy either way. And I know again, we talked about your lack of an ego, you’ve also been described as very calm under pressure. And I think I can imagine, many businesses that go on an acquisition spree might have a slightly different character at the top and that’s going to lead to some kind of a challenging situation. I think the culture that you have as an organisation that always stems a little bit from the culture of the founder, I’m sure – or the founders – is really important. If your culture underneath all this had actually been, ‘buy, buy, buy’, it would have been ‘clash, clash, clash’ in these scenarios. So let’s talk about brand because I assume that your culture and your employee values and your brand values, this is all one thing for you. There’s not a brand set of brand values, and then a set of – or at least there haven’t been, in the world of multiple brands, now there is – but historically, you’re an inside out organisation. You say this is who we are. That’s your marketing message, in many ways.
Aron Gelbard:
Yes. And I think we’ve become better at articulating that and living that over time. So we’ve looked to do things that represent our values and the way we do business that are visible to the outside world. So a couple of examples that we’re known for: one is proactively identifying when flowers aren’t going to get there and automatically sending people a replacement to arrive ahead of special occasion before they complain about it.
Jamie Mitchell:
I can’t even figure out how you do that.
Aron Gelbard:
So we built technology that identifies the progress through delivery networks of an individual box of flowers, if you’ve sent your mum flowers for Mother’s Day and we can see by mid afternoon, on the Saturday before that they’re still three steps away in the Royal Mail network, we can run that data against historical data and figure out that the chances of them arriving on time by the Sunday are about 5%. Rather than waiting until Monday for you to complain, and we send you a replacement on Tuesday, but it’s too late, we proactively send the replacement on Saturday by courier so that it arrives on Sunday, and then we let you know that we’ve done so which costs the same to us – it probably costs less for us to be honest – but it makes a materially better customer experience. And this has required us to invest in technology. but for me, that’s an example of – we can use the words care wildly as our slogan, and it’s also a value – but for me, that’s an example of us bothering to find a way of doing that. I’d much rather invest tech time in that than in some sort of conversion rate optimisation gizmo, which we should do as well, but this is actually doing business differently in a way that’s a win-win.
Jamie Mitchell:
Interestingly, I had a similar moment when a pet food subscription business founder said to me that they can see from their data when your pet has died and they sent flowers. But as you raise the expectation, the cost of failure becomes even more great, which is fine. I mean, it’s appropriate, it should be, right? But it’s a really good example of how a lot of people, including me, fall into this idea that it’s really hard to find people in the world of marketing who are brilliant on the creative side, understanding how you effectively communicate and talk about a business, and then people who are data analytical and tech and so on. Are you, as an individual, someone who bridges that? I noticed you had a co-founder originally, Ben. And I looked at the two of you and I thought, ‘Ah, you’ve got the Adam and the John of innocent, but where’s the Richard? Where’s the creative brand person?’
Aron Gelbard:
Yeah. So that wasn’t part of our founding team. And I think Ben and I brought the sort of innovation and trying to do things differently and shake up our industry, but I don’t think we individually brought the the creative and proposition flair. We now have somebody outstanding who leads that area across our group. She’s been with us for for nearly three years and we’ve had other people.
Jamie Mitchell:
Absolutely, you executed on this for a lot more than three years.
Aron Gelbard:
We had somebody else who was very good before that as well. So we’ve hired great people in this area because that wasn’t the background that we came from as founders.
Jamie Mitchell:
So how have you found the merging of the analytical and data driven mindset and the creative mindset? Is it merged now out there? Are there lots of people who’ve got this from their past experiences, or is it still?
Aron Gelbard:
No, there aren’t many people who are good at all of those things. There are some and we have some people like that in our organisation, but you don’t need that. You can have a team of people where different people bring different skill sets, and then we bring them together and we co-create.
Jamie Mitchell:
Is it the person who’s bringing it together that’s got to have that?
Aron Gelbard:
Well, it’s ultimately on me to bring it together and I don’t come from the creative side, but I I very much enjoy working with creative people, people who think about innovation and propositions. And ultimately, it’s my job to bring together that with something like finance, which is very analytical, something like technology, which is in some ways analytical, but it’s also like more sort of logic, like somebody who’s sort of like an AWS infrastructure developer is not analytical in the same way, as a finance manager, they’ve got another different set of skills. But it’s, it’s my job to lead a group of people that bring together these different capabilities in order to create a business that that wins by having a better supply chain and better technology and a better proposition.
Jamie Mitchell:
So it’s really interesting to me, I was pondering, as I navigated the streets of London on my motorbike to come over here, a frustration I’ve had as someone in and out of the consumer world for a long time with this word brand. It’s always felt meaningless to me, yet I use it a lot. And I was suddenly reflecting, and as you’ve spoken, I think this feels very true for your experiences. In the way that growth is an input to other output measures, as I was saying earlier, I think this concept of brand is an input to customer experience. And what you’ve done, that people might say, has created this great brand, is you’ve had this single-minded focus on the customer experience. And if that’s the objective, you know, at the end of the day, the measure of health of the brand, is that engagement with the customer and the loyalty and are they the marketing voice for you? Are they are they spreading the word? So I think for me, I felt comfort in reflecting that actually, what you need from day one if you’re going to have a good brand to use industry term, is your absolute passion for the customer. I almost want to go down into a rabbit hole of where, where that comes from. But I’m aware that we don’t have an awful lot of time. I’m actually going to talk about two things that made me go, ‘Oh, that’s really interesting’, because I just want to know about them. Let’s start with thoughtful marketing movement. And then I also want to hear about the tech blog. Both of which to me, made me interested in your business and what made me want to be a customer by the way,
Aron Gelbard:
I did them in the opposite order, so on Code and Wild, our tech blog, there aren’t really any other flower companies around the world that have invested in technology and data and infrastructure in the way that we have. And it’s been a big part of how we’ve been able to scale, do hundreds of 1000s of deliveries per week at our busiest times, be able to give people highly automated experiences which they can navigate very quickly, and not make mistakes in operation, we plan out forecasting and supply of a perishable product. All of these things, and in order to do that, we need to attract great tech and data talent. The challenge is that most people who are graduating from Makers Academy or General Assembly aren’t, immediately looking for a job at a flower company. They’re thinking about crypto or things like this. So we need to sort of put ourselves on that map and and be a great place for people to work. And actually, I think we bring things that are different to a lot of other places you can work in tech. I don’t think we have a bro type culture in the way that a lot of very male-dominated tech startups and scale-ups have got. I think we have a physical product, an emotional experience that we’re creating, that’s interesting to people. But we need to tell that story and get that great talent to consider what we’re doing out of the blog. The blog shows that we’re solving interesting tech problems that a developer who doesn’t know about us might not associate with a flower company.
Jamie Mitchell:
You’re building relationships with technology people before you hope to employ them.
Aron Gelbard:
Yes.
Jamie Mitchell:
I think that’s genius. By the way, great name check for Makers, Evgeny and Claudia are both Volunteer Advisors here as well. I was interested, for me as a non tech person, I just love it. I’ve also got a terrible prejudice that makes me think tech people like to be sat in a dark room, staring at a computer and this was putting them out in the open and, and bring that operational transparency into a world that’s that’s usually quite dark and hidden away and impenetrable for people like me. Okay, that explains that one.
Aron Gelbard:
Now onto the cell phone marketing movement.
Jamie Mitchell:
Yes, so, first of all, how many of some of the best brands in this country run in that?
Aron Gelbard:
A couple of hundred.
Jamie Mitchell:
And what is it? Where did it come out of?
Aron Gelbard:
A few years ago, at Mother’s Day, we started getting emails from people saying they loved Bloom and Wild but they would really prefer if we wouldn’t email them for Mother’s Day. This is before GDPR came out, so we basically had a sort of database, which we put them into, and then we stopped emailing them. And then we added them back into the main database after Mother’s Day, and it’s all quite a manual process. And then GDPR came along, and sort of like moving people’s email addresses between databases didn’t seem like the right way of handling data in a more scalable way. But also, we thought maybe we could make this sort of proactive rather than reactive, a bit like what I told you about sending replacement flowers. So the following year, we thought, why don’t we email people at the start of the Mother’s Day season, which is a big trading period for us, and say, ‘Would you rather not hear about us this Mother’s Day?’ which was the opt out, option. We’d had maybe 50 people email over the years so we thought maybe if we sent it out, proactively, we would get a couple of 100 people. Anyway, on the first day, we had 17,000 people opt out of receiving Mother’s Day email addresses from us, which was a decent percentage of our database at that time.
Jamie Mitchell:
Was the immediate reaction, ‘Oh, my God, we’ve shot ourselves in the foot’?
Aron Gelbard:
No, not at all. The immediate reaction was amazing. This is a much bigger problem than we thought and actually a lot of those people would have probably unsubscribed or not shopped with us again after being silent sufferers. And by giving people the opportunity to not hear from us for Mother’s Day – they probably weren’t going to buy from us for Mother’s Day if it was a difficult time of the year anyway – we weren’t losing out commercially by not emailing them. We can actually email them anyway and email them not about Mother’s Day. So when you know the rest of the database gets a Mother’s Day email, they can get a different email which is potentially useful to them and not painful for them to receive and then we don’t lose them from our database. It’s actually good business for us as well. It doesn’t need to be a trade off, you just need to think about it but then it’s also more sensitive for them. So we did this and then as this evolved, we also thought how can we make this a sort of 360 experience? It wasn’t just email, there was also no Mother’s Day bouquet, no Mother’s Day push notification, no Mother’s Day Facebook retargeting, none of it. And then we thought, you know, why does this need to be just Bloom & Wild? Can we get other companies to do this as well?
Jamie Mitchell:
Hold on. That’s the bit where I ask why you suddenly thought of getting everyone else involved.
Aron Gelbard:
Because our mission here is not to make Bloom & Wild a better company, it’s to give people for whom this is a difficult experience the opportunity to avoid that.
Jamie Mitchell:
Yes, but saying it and actually doing it are two different things.
Aron Gelbard:
But doing it wasn’t very difficult and, again, there’s benefit for Bloom & Wild because we are a change maker and people see that we’re trying to drive change in an industry and help us form partnerships –
Jamie Mitchell:
So, within the conversation at the time, that wasn’t on the summary like, ‘Why we should do this’, this was a really important, ‘We need to do this’.
Aron Gelbard:
Of course, we need to do it, but the reason I want to respond is of course that wasn’t the reason to do it. It’s very like becoming more sustainable. Very often people assume that’s a cost that you’re going to incur that will make your business perform worse, but you’re doing it because you’re sort of like, nice people. And we are nice people. And we do care about how we do business. But we also don’t believe that there needs to be a trade-off between being nice people and being commercially successful. Because actually, all of these things, make consumers appreciate what we do. Being sustainable and having a path to net zero, taking out materials that can’t be recycled, reducing our carbon footprint and tracking that, all of these things, there’s a cost to doing them, but our consumers really care about them. So rather than viewing that as a cost, I view that as an opportunity to make that experience better.
Jamie Mitchell:
Does it matter whether you think commercials first, or ethics, or humanity, whatever reason you want to give it, does it matter if you’re doing it, first and foremost, because it’s the right thing to do but it brings commercial benefits versus, ‘This brings commercial benefits and it’s the right thing to do’?
Aron Gelbard:
You have to start with your customer. And we’re trying to make a better customer experience with everything we do. Now, obviously, we have to make a living, we can’t just give people like super expensive.
Jamie Mitchell:
Sorry to interrupt, which I know I do. But we have start with the customer. There’s that thing, again, single-minded. There’s a lot of purpose driven businesses out there, for whom the answer is the purpose and the customer fits into it, but it doesn’t come out always as the first thing that someone says, and I’ve heard it so much today. And you’ve got a hard stop.
Aron Gelbard:
I should wrap up in a minute.
Jamie Mitchell:
And we haven’t done the Three Things. We could cut this into a video call, the Three Things?
Aron Gelbard:
I can do a couple more minutes.
Jamie Mitchell:
Okay, but in round two of this, because I have to come back, I’d love to delve into sustainability and what you’re doing, I would absolutely love to just spend a lot longer talking about how you make that customer at the heart of your business real because I it’s in everything you’re saying. And I think it’s intriguing and it’s the only way to build sustainable businesses. I’m fascinated by it, but I have to stop it there because I was late today, I got my timing wrong. It’s good. We’re keeping it nice and short for people. Three Things though, you don’t get out the door. Without either from everything we’ve talked about, or in some other bit of advice, or whatever you want. Frankly, I just want to know what should people be doing today, if you are advising them generically, or specifically for different industries.
Aron Gelbard:
Keep an eye on your numbers, number one. Make sure that you’re on top of return on investments, things like that, and you don’t run out of cash because it’s a difficult world out there. Focus, try to do fewer things. You’ll have loads of good ideas, you should probably do all of them at some point – or some of them at some point – but you don’t need to do all of them now. And continue to be kind, treat people well, people in your business, people around your business. It’s very inexpensive and it makes a really big difference to the experience you give people.
Jamie Mitchell:
Your framing that as general advice or specific advice, given these economic times.
Aron Gelbard:
The third one is general advice; I don’t think that kindness should ever go away. The first one should be general advice, keeping an eye on your unit economics and things like that.
Jamie Mitchell:
Sometimes you can play a little loose with that if you need to.
Aron Gelbard:
At times, maybe you sort of want to take more gambles on growth but right now I wouldn’t be doing that. And then ditto with your cash position.
Jamie Mitchell:
Is that a source of focus for you? Is that a rule always, or is this just right now with cash?
Aron Gelbard:
It’s especially right now. You really need to get your day-to-day commercial execution right because you need to carry on doing business, carry on serving your customers.
Jamie Mitchell:
I think you framed it right. These are very, very important general things, all of them right now in this world, in this uncertainty. For the commercials and for the people, and I suspect you include customers in that anyway, always, empathy is necessary, appropriate and, frankly, who wants to build a business that doesn’t have that empathy in it? I feel I’ve rushed us. I’ve got so much I want to talk about. I find your business fascinating. I find how it’s been built fascinating in so many areas of the story we haven’t delved into, but that’s great. We’ll save it for round two. Maybe I’ll end this series with round two. We’ll see how things are going. I just want to say a big thank you. Thank you for this. Thank you for also becoming a Volunteer Advisor, the work we do is so important and we know how much – we’ve got pretty decent net promoter score too from our from our members – but we know how important it is to our members the work that we do and the advice we give. So thank you so much for your time. And congratulations on the journey so far. I’m excited for the journey to come.
