With innovation running rampant and the barriers of entry into ecommerce being so low, it’s common to come across inspiring stories of entrepreneurs taking the leap and creating a successful online store from scratch. Although harder to find, there are also success stories out there of brick and mortar stores reinventing themselves by going online. Then there are those rarities where business owners chose to break the mould and remodel their physical stores into purely online establishments.
Lighting.co.za, which blossomed from Illumina Lighting, is one such example of a business that has traditional roots dating back to the 1970s, yet which today is found solely online.
Recreating a sustainable business model
Illumina Lighting was established in 1979 as a distributor of imported lighting products and a manufacturer of simple light fittings. However, according to Conrad Wagener, Managing Director of Lighting.co.za, by the time he joined the business in January 2013, it wasn’t doing well and was running at a loss.
“Illumina as a business was old and run down across the board, from product offering, buildings and facilities, systems and management. Through making continued incremental changes, focussing on customers before moving on to our products, we halted the annual decline in turnover in 2013 and saw an upswing in 2014. When I was asked to fill the role of Managing Director in 2015, we implemented specific changes within the business and explored other avenues previously untouched,” said Conrad.
In 2017, Conrad and his team acquired the business outright and started a new division in Project Lighting and went on to complete hospitality projects such as Kerzner One and Only Le Saint Geran, Mauritius, the prestigious 5-star Houghton Hotel and a few more.
“We became profitable in 2017, the year that Abe Newman, the previous owner passed away. I was sad that he never got to see it, even though he knew it was coming through our quarterly reports,” said Conrad.
Adapting to the new normal
Unfortunately, like almost every other business that was operating at a profit before the COVID-19 pandemic hit, Illumina Lighting was forced to reassess its business model in order to keep afloat during lockdown.
“When the world went into lockdown, our main supply chain was disrupted (China, Spain and Italy) and the hospitality industry suffered greatly. This had a direct negative impact on our business, and we had to go back to the drawing board,” said Conrad.
“I had acquired the domain lighting.co.za in 2015, and when Online as a strategy was put on the table in June 2020 by my wife Hestelle, who is Head of Marketing and Operations, it seemed a natural progression. We launched within two months of conceptualising the idea and building out the channel strategy. Lighting.co.za has been operating successfully since then, and we’ve achieved our goal of becoming the undisputed online destination for lighting,” continued Conrad.
One of the biggest challenges for Lighting.co.za was the pivot from importer/distributor to retailer. “We had to go back to the drawing board and figure out how to approach a consumer, rather than a retailer, and then retain them as a customer. We achieved this through focussed strategies aimed directly at the consumer, and then expanded into attracting B2B customers in this segment as well,” said Conrad.
As a purely online store, Lighting.co.za isn’t affiliated with any showrooms or physical shops. Rather, online shoppers can browse the website for lighting solutions designed for every room’s requirement, with everything from floor lamps, wall lamps, pendant lighting, chandeliers and ceiling lights. To cater for an excellent online customer experience, they have a return policy where their customers can order an item and test it out in their own space.
“We employed all the lessons we learned throughout the seven years in the industry prior to starting Lighting in 2020. The result is that we sold our first light fitting on the first day we went live (no, it was not a friend or family member) – going on to end the month profitable for the division. We have grown month-on-month since launch. We love our customers (some more than others – a little tongue in cheek joke) and our customers love us – the reviews speak for themselves,” said Conrad.
Partnering with PayFast as a payment gateway
Another important element of Lighting.co.za’s success is that they did their research when setting up their online store to make sure they partnered with a trusted and secure payment gateway to process transactions on their website.
“We had a look at a few local payment gateways and what convinced us to use PayFast was their basket of payment options, as well as their no-nonsense approach to Online Business. We may have had very few hiccups with PayFast, but whenever we ran into an issue there was someone at the end of the line to help us through it. I also like the new PayFast Dashboard design as it’s a great upgrade from a UX perspective,” said Conrad.
“Since becoming an enterprise-level client as opposed to an entry-level account, we have experienced a higher level of detailed support, which is important for us as we grow our business. It allows us to focus on selling while letting PayFast take care of the revenue collection while mitigating the risks of online fraud on our behalf,” continued Conrad.
Forming quality partnerships
From the get-go, Illumina Lighting’s – and ultimately Lighting.co.za’s focus has been to help bring stylish and trend-driven lighting into the spaces where their customers work, live or play. Over the years they’ve built a solid reputation in the lighting industry and have formed a number of trusted relationships with manufacturers and their suppliers.
“Since we now own the category “Lighting” from an online perspective, suppliers and designers approach us directly. We always try to find a way to benefit the local suppliers and manufacturers if the offering makes sense from a retail perspective,” said Conrad.
“We literally have thousands of sales behind us, which we’ve turned into market knowledge that we’re able to share with our suppliers when required. We’re often approached for advice about designs and styles that they should consider importing or manufacturing, because apart from our current market knowledge, we also have that import t-shirt, albeit in the back of the cupboard,” continued Conrad.
Making ecommerce work for you
Lighting.co.za is a true success story of how a struggling business was able to transform into a successful online store under the right leadership. Conrad and his team had a clear goal, to become a leading lighting ecommerce retailer in South Africa, and developed the right partnerships and relationships to do it.
“Opening an ecommerce store has very low barriers to entry. This is both good and bad. You must consider this carefully before setting out to start an online business – it could mean the difference between success and failure. Just remember that online consumers are now more educated than ever on finding the best solution for their needs, and a good price is not always the key to success,” said Conrad.
“The best advice I can give to any new merchant is this: Get to know your product inside and out. Don’t be difficult to do business with and make sure your customers leave happy – it’s the only reason they will return,” concluded Conrad.
To find out how Payfast can help your online business prosper in the digital economy, visit payfast.io.
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