Daily Management Review

Wonderbox: case study of a successful start-up company on a nascent market


01/24/2017


From 2004 to 2016, the French giftbox company has successfully developed its activity all the way to market leadership, something unusual enough on a new market to be pointed out – and studied. Among its key assets: boldness, speed and unrelenting quality.



In barely over a decade, not only has Wonderbox has gone from a start-up to a 300-employee solid firm, it has also become the leader of its market – a market it was so early on it nearly created it. Founders Bertile Burel and James Blouzard started by selling “gift boxes” over the internet. The principle is quite simple, but it had to be implemented: you need to find a gift but you’re afraid to go wrong, or you prefer to offer an unforgettable experience to the one you love the most. By purchasing a gift box, you avoid making a mistake: the lucky one chooses himself the stay or the experience he prefers inside the catalog of services that Wonderbox has negotiated for you (having a massage or a gourmet dinner, driving fast at the wheel of an exceptional car, and so on!).  
 
At the beginning, the first and main axis of progress was undeniably the focus on quality. Because the market was nascent, operators on the market needed to quickly build an outstanding quality reputation, so as to avoid the very concept being nipped in the bud. In the way of such an achievement was the very nature of the relationship between Wonderbox and its partners. Partners being independent companies who, at the time, did not depend on Wonderbox for its yet-to-produce business, Wonderbox was exposed to quality liabilities which could have proven fatal in the early days.
 
So as to address the risk of poor experience for end consumers, Wonderbox financed trips for its own employees, thus setting up a network of quality monitoring sources. As the quality control evolved, questionnaires were automatically sent out to monitor customer experience and, when the company became solid enough, a quality monitoring team – called dream testers – was created. Each time a customer files a complaint, a dream tester is sent out to ascertain the claim, enabling management to decide whether or not to maintain the partnership. This element quickly proved vital to the survival, and then to the success, of Wonderbox whose products “go through 4 million pairs of hands each year”.
 
Wonderbox has two very specific aspects of its business it keeps in mind. The first is that its offers (gifts in one form or another) are emotionally charged, more than regular items. A client who would buy a Wonderbox for a friend, for instance, and subsequently find out the experience was negative, would deal a devastating blow to the company's reputation. Second, Wonderbox's clients and Wonderbox's users are most often different people. That is an unusual business configuration, which makes customer relations more complex. Customer satisfaction must therefore be doubly monitored – which explains why the customer relationship department sits within the same premises as top management.
 
Wonderbox gave a good example, throughout its development, of sound business practices, and not giving in to the temptation of making easy money. There is often a long delay between the cashflow of the box sales, and payments made to the supplier (hotel, restaurant, for instance). It would therefore be tempting to overstretch the payment delays to suppliers, to earn even more cash off their backs – something supermarkets and large retail chains are known to do. But Wonderbox didn't give in to this unsavory practice, opting for solid and pacified business relations with their network. By doing so, they secured their supplier's enduring desire to work with them.   
 
Start-ups often struggle in the conversion phase during which they transfer from simply picking up a lying opportunity to drawing their own roadmaps. In other words, from scrambling for business so as not to starve, to taking hold of their own destiny. Bertile Burel and James Blouzard soon decided to break free of the online sale segment. On the condition that they would register administratively as a travel agency, the French government authorized Wonderbox to sell hard boxes in retail stores and supermarkets. Embedding their offers into an actual, physical package gave Wonderbox the reality they urgently in the previously non-existing market and made the gift even more personal.
 
Pénélope Simonnot, market director for Wonderbox, explains “tailor-made packages are for us a game-changing innovation. The client chooses his/her own catalog amongst thousands of references keeping in mind the interests of the user. It is an additional token of thoughtfulness”. And combining offers (hotel spa and restaurant combined in one single package, for instance) gave them command of where they were going, instead of simply waiting for sports events. Finally, Wonderbox broke out of the B2C segment by addressing companies, namely offering team-building packages. The rising trend of companies of taking their teams out for some fresh air was therefore caught early by Wonderbox and fuels now its development. Olivier Desfours, the B2B sales director for Wonderbox explains “there is no further need for companies to squander hours on Google to find hotels and nearby hotels; everything is pre-booked by our company, which keeps concierge on watch to book the stay”.
 
In the end, Wonderbox shows to what extent entrepreneurial successes rely on few things: answering a market need or creating it, existing in customer minds, quickly building a reputation for quality and, finally, speed. When a market is new, start-ups will make all possible mistakes: it is essential to try new leads, and then quickly decide after due assessment, whether to develop them or drop them and move on. 







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