Episode Details

Steve was a guest of StartCon, Australia’s largest startup and growth conference. It was held over two days at Randwick Racecourse in Sydney on Nov. 30 and Dec. 1.

One For The Books The story of Booktopia, ‘Australia’s favorite bookstore,’ and how they’re conquering the competition—even Amazon.

Once upon a time, a programmer who got his start with IBM was given an enchanted opportunity to create a magical bookstore that would one day battle powerful giants. The magical power? With just a click of a button, Australians could have brand new books delivered within days to their doorsteps.

And just like in most fairy tales, our hero and his friends stumbled upon the opportunity entirely by accident. “We literally fell into it,” says Steve Traurig.

Traurig and his two brothers-in-law, Tony and Simon Nash, were running an online marketing consulting business when Angus & Robertson, the 130-year-old Australian bookseller, approached them and asked if they would be interested in getting into the book business. The pitch was a white label book retail website, meaning that everything from the website creation to the distribution would be handled by Angus & Robertson. All Traurig and company had to do was add their personal flair.

But Booktopia, the company that arose from that project, would end up becoming something much bigger. Nearly 15 years after Traurig’s brother-in-law said he “wouldn’t mind giving that book thing a bit of a go,” Booktopia has served over 4.2 million Australians and is on track to bring in $115 million this year, making it the market leader in online book sales. Oh, and they now own Angus & Robertson.

The journey from their very first book sale to squaring off against Amazon for online book supremacy in Australia was a chess game of strategic move after strategic move. Thanks to some shrewd decisions, including focusing on customer interaction and building their own ecommerce and fulfillment systems, Booktopia’s well on its way to happily ever after.

A White Label Bookshop, Transformed

In 2004, with only $10 a day to put toward advertising their new business, Traurig and the Nash brothers dove headfirst into the book world.

“When we first started, we owned nothing,” Traurig says.

When Booktopia first launched, Angus & Robertson created their website, managed their distribution and owned the brand. Traurig and his brothers-in-law were responsible only for marketing, so they created a few Google AdWords campaigns (one of which is still running today) and waited for their first books to sell. By the end of the first year, they were doing $100,000 in business a month.

This worked beautifully for the trio and for Booktopia for three years, but in 2007, they had to confront the reality that what they were building, with revenue ever increasing, could all go away in an instant. They also realized that the fulfillment company was neither able to keep up with the growth they were experiencing, nor were they able to meet the expectations Traurig held.

“We decided we had to go out on our own, because we were actually building a company of value,” he says, “and we realized that if you want to have something of value, you have to do it yourself.”

Things were going well, and they realized that in the current setup, they didn’t really own anything of substance, should they ever want to sell.

So they broke away from the fulfillment company and set out to turn Booktopia into something of their own. They set up their first warehouse, hired a warehouse manager, bought some shelves off eBay, and got to work building their own core systems.

“Dealing with those sorts of numbers in databases, in the website, in the front end, in the backend, etc., the scale is beyond almost any other retail environment, and we had to make it all work,” he says. “We built the systems ourselves and that takes particular co