Bootstrapping a $40M Niche E-Commerce Business: Stroll CEO Dan Roitman (Part 4)

Sramana: What were some of the early keys to success? What did you do right very early on that led you to have a successful business?

Dan Roitman: I was fortunate in one key aspect. Very early on I aligned myself with thought leaders. In 2001, after I found out that we would have to transition away from the first incarnation of the business, I ended up reading an article on conversion rate optimization. The whole concept was increasing the number of conversions that you get from visitors to a website.

That was pretty revolutionary at that point. Nobody else was talking about that concept back then, and I found it fascinating. I ended up staying up all night to read as much as possible on the topic. The next morning I called up the consultancy that wrote the article and asked them how they figured everything out. They provided me some background which explained what their influences were. That call ultimately sparked a friendship.

I was young and very eager to learn. I found that Bryan and Jeffrey Eisenberg really took me under their wings. Bryan was speaking at industry conferences and he would invite me as a guest which allowed me to attend conferences that I otherwise would not have been able to afford. He also introduced me to another mentor, Roy Williams, who wrote several best-selling books on advertising and owned a small business advertising agency. He offered advertising workshops, and I was able to attend a few for free. That is where I learned to write compelling advertising.

All of these things were key because they helped me keep my costs low. When I first launched my website I was still in college and I had very littlemoney. I bought one of those “learn how to program in 24 hours” books and I spent two months building the web infrastructure. Essentially I bought an existing software package, pulled out the proprietary components, and rebuilt them. That enabled me to get an inexpensive start. Keeping costs low has remained my mantra today even though we have greater resources now.

When you have to trade time for money, you are forced to do those things. Today I am in a position to spend money instead of time if needed, which speeds things up. We can hire the smartest consultants we can find to solve a problem. When you are starting up, however, the key is to keep costs as low as possible.

If you ask me today what makes our business successful, it is really that we are excellent in analytics and optimization. We do advanced Internet marketing. We are able to buy media that most companies cannot buy profitably. We are able to make that work because we can measure the return on every single advertising dollar that we spend.

Sramana: How early in your business did you start advertising?

Dan Roitman: We started right away. When we launched our first ad campaign, we did it with an ad that I crafted. I wanted it to be sent via email. My mentor, Bryan, introduced me to a friend who ran an interactive agency and one of the challenges with that ad is that you have to take a $5,000 risk just to see if it works.

Fortunately they had some impressions available because they had a lot of clients, so after a couple of weeks of convincing they gave me free media as a starting point to try the ad. That was key because my advertising was very unconventional. They really gave me those impressions as a favor to Bryan, not me. The ad worked, although if I had been forced to pay for the ad it would not have broke even. However, with a few iterations of optimization we were able to get the advertising to work.

I was able to get a beta version of Inceptor to help perform conversion rate optimizations and measure performance metrics of advertising. I had gotten that platform for free as a beta user and they ultimately used me as a case study. In one of their tests we increased conversion rates [by] 1,500%.  Unfortunately we have never had a conversion rate optimization test since that was as successful as that.

This segment is part 4 in the series : Bootstrapping a $40M Niche E-Commerce Business: Stroll CEO Dan Roitman
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