Sramana Mitra: What did you do first to get this thing off the ground? Were there other car parts site at all, or was this the first one that came online?
Dara Greaney: The way the auto parts industry grew was everyone started selling their own niche products. If you were in the wheels business, you’d just sell tires. The fuel guys sold fuels. None of the major brick-and-mortars were online. There was no one that had a full line offering of auto parts online. We identified that we had some expertise in steering and some connections in steering products and that we could be successful just starting with steering. Our business plan was to focus on a limited narrow niche that we could capitalise on and be the steering experts online.
Sramana Mitra: Where did you get the inventory from? Did you buy the inventory or did you get it on consignment?
Dara Greaney: It was a combination of all. We bought some inventory. We also went out and convinced a couple of other people to drop ship for us. That was a new concept at that time. Now, drop shipping is common today. Back then, it was only available for wholesale products. We created enough assortment to be able to do it, and then we decided that we wanted to focus on our niche because we had the margins. We focused on buying a bunch of specific domain names around steering. We bought carsteering.com and buysteering.com.
Sramana Mitra: So your SEO was really great.
Dara Greaney: That was our plan: hit SEO numbers and get that traffic. When we started, Google AdWords wasn’t even around. Overture was starting to come on board. Paid search wasn’t available, so the only way to get traffic back then was organic. We built four to five sites around steering and just tried to capture different keywords on steering.
Sramana Mitra: What kinds of numbers did you do with that? Do you remember what your numbers were from 2002?
Dara Greaney: We did pretty well initially. I think we were doing around 700,000 in 2001. We jumped pretty quickly. We did about a million if I remember correctly in 2002. We sold a couple of hundred thousands, which was shocking to us. We weren’t expecting to sell that much. That was a good sign. It wasn’t profitable initially but at least, the revenue was there. Each year after that was explosive growth. We were seeing almost 100% growth till about 2005 just because we were simply adding products that no one else had online.
Sramana Mitra: You did steering first. What were the other categories?
Dara Greaney: For the first couple of years, we focused on expanding the steering portfolio. In automotive parts, there’s a lot of SKUs. Our focus was to get as many steering-related products up as possible. We started selling steering racks, steering gearboxes, and steering pumps, and trying to make sure we had a complete line of steering offering.
About a year or two later, we realised that we had maxed out the number of offerings we could do on steering because there wasn’t anything else there to add. That’s when we went looking for other verticals. I researched on things that people would need online that nobody was selling. The next one I found was air-conditioning.
We got on the phone and figured out who had air-conditioning products and found a couple of people who we networked through and added that catalog in. Around the 2004 time frame, that really took off for us. There was a larger domain for air-conditioning than for steering. That really propelled us forward. We had all these high-margin parts that were just great sellers.