Fred Karlsson – Done Deal Essay
Sorry, but copying text is forbidden on this website!
Fred Karlsson is a Swedish entrepreneur and co-founder of DoneDeal.ie along with his wife Geraldine, a native of county Wexford where the business was founded and is currently situated. Karlsson is a self-confessed ‘techie’ and was involved in the creation of video games alongside a childhood friend from as early as 14 years of age. Upon graduation from the University of Lund with a diploma in Computer Science in 1997, Fred moved to Ireland for 3 years where he met his wife-to-be before relocating to Australia for a year and Sweden for a further 3 before returning to Ireland in ’04.
The idea for an Irish online classified ads website emanated in 2005 when the couple wished to purchase second-hand furniture online from a local source as was readily available in Sweden and found that no such website catered for these needs in Ireland. In typical entrepreneurial fashion, the pair realised that there was a large gap in the market to establish an online classifieds website as Ireland’s closest equivalent at the time was the ‘back-of-the-paper ad’ often unaccompanied by illustration so the consumer was blind as to what they were purchasing.
Ergo, DoneDeal.ie was born in June 2005. (Done Deal, 2011)
Since Done Deal’s inception, the enterprise has been a roaring success. Only seven months online, the site hosted over 2,000 ads across a variety of categories, a figure which stayed relatively constant for the following year (circa. 2,257 ads carried in Dec. 2007). However, that number snowballed in the subsequent months as traffic (grew by an average of 10% monthly) and advertisements (2008:269% and by a further 923% in 2009) had ameliorated vastly, as detailed in the tables below.
(Done Deal, 2011) – Ads growth between June 2007 and December 2009
(Done Deal, 2011) – Site traffic between June ’06 and Dec. ‘09
The firm continued to expand rapidly and in May 2011, Done Deal had more than 2 million unique visitors to the site. As of the end of January 2012, the online classifieds giant hosted approx. 160,000 ads, 90,000 of which are newly advertised each month. In 2011, it was “confirmed as Ireland’s fastest rising Google search term in 2011, ahead of Pippa Middleton and the iPhone 5”, no mean feat! (Cullen, 2012)
I believe these gross growth figures are attributable to the entrepreneurial instinct and foresight applied by Fred and his team, as well as the business model the company exercises to achieve their goals. First and foremost, in my opinion the primary justification one could derive for such success is the company’s approach to its customers and customer feedback. According the Geraldine herself, she feels customer service should be provided “properly”. The business employs an email only customer service approach as Fred, in typical entrepreneurial fashion, believes that time spent on the phone is time was as it could have been spent “growing the business”. (Karlsson, Fred’s Talk at the 2010 Dublin Web Summit, 2010)
There is a strict policy that all emails will be answered within 24 business hours of receiving an email. (Done Deal, 2011) This timeframe does not only facilitate the company to make a timely and informed response but it allows the customer to receive swift feedback in relation to any queries they may have; a desirable and equally service offered by a company of Done Deal’s magnitude. Who wants to return to do business with a firm where queries have a turnaround of a week?
Fred Karlsson views customer service as a marketing opportunity rather than a cost. Not only does an efficient customer service regarding qualms an individual has “instil confidence and trust” about the website but it accommodates the firm to delve deeper into the psyche of its customer base and establish what it is the customer expects and wants from the website. Done Deal has taken the approach of gearing their business towards the provision of ‘what a customer wants and not what they ask for’. The phrase “people don’t know what they want until you show it to them” was made infamous by the late Steve Jobs, one of the most successful and revered entrepreneurs of all time, and this is the model Done Deal has chosen to utilise to some degree. (Linzmayer, 2006) Through feedback, they ascertain what it is a customer needs and wants rather than requests and strive to achieve the balance between the two.
The above leads on to the customer experience as a whole. From the outset, it was Karlsson’s intention to keep the site simplistic and clear; devoid of any complexities in order to make it as accessible as possible to the broadest range of users. Done Deal has focused on removing as much ‘excess baggage’ from the site as possible to the point where if you remove anything else you would hamper the core of the site. According to Karlsson, this reduces what he describes as the “brain-time” of the user. It minimises potential distractions and disallows users as much as possible from deviating away from what they actually came to the website to do. In order to actualize this objective, he utilized family and friends whom he felt had the least amount of knowledge in any of the areas he wished to test and adopted the mentality that if they could use it as the website intends, anyone could. (Karlsson, Fred’s Talk at the 2010 Dublin Web Summit, 2010)
Another standout facet of the success of Done Deal is the entrepreneurial vision and drive shown by the Karlssons. Upon establishing Done Deal the pair were both full-time employees with a background in IT. They dedicated their evenings and weekends for circa a year and a half as well as holding their full time posts to writing code for the site. The couple’s technical expertise accommodated the progression and growth of the site without having to source finance and labour externally, a factor which often hinders start-up enterprises.
Fred himself illustrated risk-taking, one of the most prominent characteristics of an entrepreneur, when leaving his own post to work full time on Done Deal’s augmentation. He worked on the site by himself during the week. Between the pair, it was realised that Geraldine possessed superior organisation and management skills and she spearheaded the weekly reviews that took place between the two which enabled Fred to keep focused on the project. A year subsequent to Fred taking up the reigns at home of the site’s expansion, Geraldine also took the plunge. (Karlsson, Karl Fitzpatrick interviews Fred Karlsson from DoneDeal.ie, 2012). The pair’s dedication to the cause as well as their openness to take risks may well have been one of the telling factors in the success of the site as a competitor such as Gumtree may have swooped in and established such a webpage before the Karlssons, thus eliminating any need for their new site.
However, despite their established IT background, neither Fred nor Geraldine had any experience in marketing. Upon recognising they did not have the necessary skills to progress as they would have liked, they approached their county enterprise board for advice who put them into contact with marketing mentors. They provided exponentially constructive and pragmatic advice that ‘plugged the gaps’ in the couple’s knowledge (Done Deal, 2011). This empowered Fred and Geraldine to get the most ‘bang-for-their-buck’ as they spent their limited resources on the most efficient and rewarding means of advertising.
Once traffic was directed towards the website through continuous marketing, customer retention was the next issue the couple was faced with. As a site the nature of DoneDeal.ie did not already exist in Ireland, Fred and his wife had to adopt a trial and error approach to try and rectify this. As previously demonstrated, they focused on the business model of clarity and ease of use as well as the provision of ‘a positive customer experience’. According to Fred, word of mouth accounts for 50% of their marketing and once one consumer had a pleasant exposure to the website, they would inevitably let contacts of theirs know about it. (Karlsson, Karl Fitzpatrick interviews Fred Karlsson from DoneDeal.ie, 2012) In the era of social networking, this form of advertising has become central to the success of firms, no more clearly illustrated than in the case of Done Deal.
Fred Karlsson himself admitted in a radio interview with Karl Fitzpatrick that he and his wife used to sit in the office at home and stare blankly at each other without a clue as to where to go or what to do next. This alone contradicts the common perception that all entrepreneurs are an untouchable collection of ‘know-it-alls’ who were able to build an empire from the ground up using a formula unknown to the rest of the population..
However, most entrepreneurs will admit that luck was the overriding factor in their success. One such example Fred illustrates is how Done Deal was able to grow ‘under the radar’ in Wexford before expanding to Dublin where the company was substantial enough to stand on its own two feet should a competitor try and emulate their business model. However, one must still possess the entrepreneurial spirit and characteristics necessary in order to be a success in business such as those illustrated by Fred and Geraldine Karlsson. No business will flourish without encountering some obstacles along the way but your success as an entrepreneur will depends on your business choices and how you choose to approach such issues.
Cullen, C. (2012, January 30). 8 beliefs that make an online phenomenon tick. Retrieved December 16, 2012, from Conor Cullen Web site: http://conorcullen.com/tag/donedeal/
Done Deal. (2011, January). Done Deal Case Study. Retrieved December 17, 2012, from Done Deal: https://blog.donedeal.ie/wp-content/uploads/2010/01/DoneDeal-Case-Study-Jan-2010.pdf
Karlsson, F. (2010). Fred’s Talk at the 2010 Dublin Web Summit.
Karlsson, F. (2012, October 15). Karl Fitzpatrick interviews Fred Karlsson from DoneDeal.ie. (K. Fitzpatrick, Interviewer)
Linzmayer, O. (2006, March 29). Steve Jobs’ Best Quotes Ever. Retrieved December 17, 2012, from Wired: http://www.wired.com/gadgets/mac/commentary/cultofmac/2006/03/70512?currentPage=all