Video Transcript

00:12 Scott Gerber: You've obviously scaled tremendously in the last half decade. What are some of the consistent strategies you've used as you've systematically built the company that have remained, and you're thinking about building it smart versus just building it to keep up?

00:26 Alexis Maybank: It's best to get ideas from your customers directly and not necessarily think, "Oh, this makes sense to me. Let's just do do it." A couple ways that's manifested for us, as a company, is first we had a number of out customers saying "It's great that you offer these sales. I jump on my Blackberry, my iPhone though and it's really hard for me to go though your site". And we listened to that and then started redoing the way that we select a product, the websites, built the experience so that first we are thinking of it as a mobile experience. What should our business look like on a personal device 'cause our customers are telling us this is how they are now experiencing us.

01:03 Maybank: So, we would never have, if we'd just looked internally, thought, "Okay, this is a big area of investment we need to make." We heard it from customers. We responded really quickly. And we oriented every part of our operations so that we could adopt, kind of, a sea way of change that we were experiencing from our customers. What started as requests that were coming in frequently saying, "Make it easier for us to shop on our smart phones or our mobile devices," soon, over a 24-month period became, on a typical weekday, 30% of how we're selling products. It became on a typical weekday, 50% of where revenues are coming in. And being really good at listening to the customer and responding quickly, it's hard to do, but I think it's the source of the best ideas and how you stay innovative and responsive in the face of what is usually an onslaught of competition in our space.

01:57 Gerber: What are the key elements across the boards that people have to be thinking about constantly from an executive level as they scale the operation entirely from these different components?

02:07 Maybank: There's so many things that I think are critical. I'll name three. The first when it comes to scale is you have to have an understanding, as an executive team, that the business you've built to first service 10,000 people or 100,000 people is not gonna be the same business that services five million. And what I mean by that is, systematically either you have to break it or it will break almost every part of your company's operations. We have systematically rebuilt the backend of our site. We have had to rebuild our physical logistics and operations two or three times. And it's a sign of success and growth, but it can also be scary to people, because if you aren't anticipating or reacting really quickly when you see elements of your company breaking as it struggles to keep up with demand, then it could be something that brings your business to a halt. Websites crashing too frequently, boxes getting there in three weeks instead of the promised three days, but you need to systematically address every area.

03:01 Maybank: I think in our case another couple of things that were critically important as we scaled quickly, how you reach customers fast enough. So marketing was a really important area of our business to get to scale quickly. How you reach customers, how you involved them as, sort of, an army of your own marketers too is something that we benefited from. We put incentives in place for our customers to go out and find other people who wanted to shop this way. And that helped us really leverage effectively the cheapest form of marketing, which is viral marketing.

03:36 Maybank: Lastly, while our idea's very simple at the face; flash sales, come, great prices, first-come-first-serve, it's a very difficult model to scale. When you are hosing 75% of your business in 90 minutes a day, we look at the load on our servers that come in, from a very small company, we had to be building a business that had to act like Amazon for an hour and a half a day. We had to leverage cloud computing to be able to do that explosion in simultaneous processing to allow that many people to enter our virtual front doors. We had to figure out how we build customer support logistics to again sustain immediate inbound urgent requests coming from customers that need to be responded to right then and there. Our business had such a spike of activity, over just a few quintessential minutes a day, that it proved very challenging to scale.