Matt Donazzan, 28, is from Melbourne, Australia. He started his online marketing and eCommerce business, One Cent Group, in 2012. One Cent Group gives consumers the chance to win by auction amazing prizes at incredible discounts. They sell excitement – they are one part auction business and one part customer reward program. The business includes the sites OneCentFlights.com and OneCentWines.com.
Starting the Business
Q: Where did the idea for your business come from? Where were you in your life and career?
A: In my honours year at University I spent a significant time looking at auction theory. This study made me realise that there were huge opportunities to use auctions to deliver exciting and interesting experiences to consumers.
While working full time in Corporate Finance, I encountered a range of business working in the digital space – and found those focused on consumer marketing, loyalty and reward systems particularly interesting.
The idea for the business involved combining these two aspects: pay-to-bid auctions and reward programs.
My business partners and I have always been obsessed with travelling, and that is why we decided to launch the business in the travel industry first with OneCentFlights.com. The rest of the business flowed on from there.
Q: What was the biggest challenge you faced when starting out?
A: The biggest challenge we had was how to recruit and retain quality talent – ultimately a business is just a collection of people.
Q: What is the one thing you know now that you wish you knew when you started the business?
A: When we started OneCentFlights.com we were terrified about competition coming along and stealing our idea.
I now know that execution is as important as the concept – if I had known that, perhaps I would have spent less time fretting about fast-followers (all of which are either gone, or are struggling).
Q: What would you consider your first big success in the business?
A: When we kicked off our first big marketing campaign, and a few months later revenue passed the $100,000 per month line, we knew we were on to something.
Q: What is the toughest thing about getting to the top / staying on top in your industry specifically?
A: The most difficult thing is maintaining your brand.
Online every man and his dog wants to leverage your success (be that through using similar business names, domain names or other tricks).
We take this seriously and spend huge amounts of money on lawyers shutting down those that try to infringe our rights.
Q: Where do you see your industry heading in the next 5 years?
A: I believe that the loyalty and reward space is a huge growth area – as competition intensifies online it becomes ever more important to find ways to attract and hold the attention of customers. Incentive rewards are an important part of the equation, and we believe it’s a great space to be working in.
Q: What do you plan on doing / changing in order to keep growing in this time period?
A: We plan to grow our headcount, to ensure we can deliver an amazing customer experience to our users both here and internationally. We will also continue to invest in technology, with the goal of improving the customer experience.
Q: What does ultimate success look like to you? How will you know when you’ve achieved it?
A: We are building a powerful tool which helps attract and hold customer attention. We know global consumer marketing companies (from the group buying sites, to the frequent flyer programs) are also trying to do this, but in very different ways.
Success for us is beating them (more consumers than them), or joining them (by being acquired).
Q: What do you think will be the biggest challenge facing entrepreneurs in the near future?
A: I think the biggest challenge is also the biggest opportunity: Asia. The market is massive, which means it is a compelling place to do business. However, as the region matures and takes the lead, from a technology and innovation perspective this will create new competitors for Australian entrepreneurs to contend with.
Q: What one piece of advice would you give to someone just starting out in your industry and wanting to make it to the top?
A: Start immediately and, if you are going to fail, make sure you fail fast.