Over the last two years Laundrapp has taken its online laundry app to over 100 towns and cities in the UK, with plans to be in 15 international markets by the end of 2018.
Edward Relf co-founded Laundrapp in January 2015, after two years heading up marketing at digital content and media company, Mind Candy – the brains behind kids' gaming phenomenon Moshi Monsters.
Now CEO, Relf discloses six secrets to Laundrapp’s success at revolutionising the way people clean their clothes.
1. Change consumer habits
Relf explained that his biggest challenge has been changing existing consumer habits. He pointed to apps like Just Eat, Uber and Deliveroo which have disrupted industries by changing consumer habits. But laundry isn’t an easy habit to break.
“If you do laundry, you probably do it every week, every couple of weeks, or maybe even every day,” he said at eCommerce Expo 2017. “But it’s a habit which consumers do religiously, maybe on a Sunday morning, or they wait until the basket is overflowing – either way, you still have a cycle and a habit.”
“Once you use apps like Laundrapp, Uber, Just Eat and Deliveroo, once you’ve used it once, maybe twice, it changes consumer habit and becomes habitual and that’s the key to making those kinds of businesses work.”
Relf noted how a habit is much easier to change before it is even formed. “As adults we don’t do our laundry until we’re much older, so we can change consumer habit for a younger audience very easily. That’s why these types of [apps] really thrive in that younger, millennial demographic who are much more willing to try new services.”
But he said a habit does not change overnight. “This won’t happen in the next six months, but in the next 5-10 years, we believe this will be as big as some of the taxi apps.”
2. Find a new market to disrupt
Over the last two years, Laundrapp has quickly become the UK’s biggest online laundry service. While its slick app and start-up mentality has driven this growth, another simple reason it has got so big is that the laundry market was untouched by technology before Laundrapp came along.
“There’s genuinely very little happening in this space,” said Relf.
While the global laundry market is a multi-billion pound industry with players including high-street dry cleaners, detergents, FMCG brands and white goods manufacturers, it had seen very little technology disruption up until two years ago.
“It’s extraordinarily large and there’s barely any technology innovation happening,” he explained. “Any innovation is going on in the machinery, but nothing on the software side.”
3. Spend wisely on advertising
One important lesson Relf has learnt from launching a start-up is how to spend advertising budget wisely taking into consideration social media and other niche channels.
“Some of the large businesses have been lazy about the way they apply their budget, but sometimes when you only have a few hundred bucks, that is when you get really smart with the way you spend.”
4. Understand the lifetime value of your customer
Relf advised businesses to monitor the right metrics. “It’s easy to fall into the trap of vanity metrics – clicks to site, likes on Facebook, app downloads,” he said. “But this is completely irrelevant. The only thing that matters is how much did it cost you to acquire a customer and what is their retention – that will dictate lifetime value.”
He noted how millennials are fantastic when it comes to app installs, but they don’t spend the money. “If you’re spending £50 to acquire some 20-year-old who uses your app once and never comes back, it is a complete waste of money.”
He said retailers need to understand the lifetime value of a customer, understanding that some customers maybe have 10 times more value than a customer who uses the app once and never returns.
5. Learn the busiest time for orders
When starting Laundrapp, Relf and his team assumed the busiest time for orders would be on a Sunday morning, when many consumers would normally be throwing a load of laundry into the washing machine.
“But we were so wrong,” he said, explaining how the busiest time for orders is actually on a Monday morning between 7-8am, when consumers are on their way to work.
Relf used this information to channel Laundrapp’s advertising to catch consumers on their commute to the office.
“Our consumers are using the service to outsource their laundry and make their commute to the office more efficient – this was very powerful to our business,” he explained.
“The people who use our service are really organised, live around routine and value their time,” he said, noting that the average person spends 3-4 hours every week doing their laundry.
“That’s not just loading the washing machine, but ironing the shirts and taking a suit to the dry cleaners,” he added. “If we can give people back those 3-4 hours a week by using our service, that’s a powerful proposition."
6. Don’t let data prevent gut feeling
“I no longer allow data to control every decision,” said Relf.
Recognising how controversial this comment was, Relf explained how people can rely and use it as an excuse for not trying new things.
“I’ve sat in so many meetings where people are using data for inactivity – ‘we shouldn’t do this because the data says the response rate is really low’. It’s always used an excuse.”
He said while some business decisions need a data point, others such as launching new products or entering new markets, don’t necessarily need data.
“Let’s just try it. We have nothing to lose,” he said. “We test, we learn, and if it works we scale, and if it doesn’t we stop.”
He added: “That fear of failure often leads to people allowing data to control every single decision they make – there’s always a time and a place for a gut feel.”