Here, we examine the strategies that helped the founders of Bookshop.org, New Masters Academy and FitVine Wine reach profitability at a relatively early stage of business, as revealed to the U.S. Chamber of Commerce. Other business owners may wish to consider applying these founders’ approaches to their own firms. However, be sure to consult a professional for advice based on your particular situation before changing your strategy.
Staying lean
Bookshop.org launched with enough cash for eight months of operation, but it became profitable within three months of its launch. CEO and founder Andy Hunter credits the business’s success to staying very lean. He launched the online book shop with only four employees, and by the time it reached profitability, he had hired only two interns.
Tapping consumer-driven demands
Bookshop.org tapped consumer interest in supporting local businesses during the pandemic. FitVine Wine co-founders Mark Warren and Tom Beaton delved into their customers’ health-conscious leanings amid the pandemic and listened to their partners’ suggestions to grow their business. Online art class platform New Masters Academy founder and executive director Joshua Jacobo curated a vast library of videos and photos for artists before launching in 2013, by which time it had attracted subscribers to pledge to join by offering an affordable rate.
Calculating an optimal cost structure
Bookshop.org gives away over 75% of its profit margin to local bookstores, publications and authors, motivating people to buy and sell on their platform. FitVine Wine launched as a direct-to-consumer business and once it moved into retail, existing customers helped drive growth as a de facto sales team. New Masters Academy ensures that the volume and quality of its online art classes are worthy of the subscription fees.
Meeting customers where they shop
FitVine Wine co-founders Mark Warren and Tom Beaton advise using the right marketing channel, meaning going where customers shop, can pave the path to profitability for your business. They prioritize tapping into communities where their customers already exist. The founders of Bookshop.org. emphasize that providing good customer service ensures previous customers come back. New Masters Academy cultivated a reputation as a premier platform for professional artists online before launch.
Employing clever marketing
Bookshop.org used press, word-of-mouth and social media campaigns as part of its pre-launch marketing strategy. As a result, a few articles about their mission to help independent bookstores went viral. Many consumers looking for ways to help during the pandemic discovered bookshop.org and promoted their mission.
New Masters Academy incentivized users to subscribe early through its online pre-launch marketing campaign. Its marketing campaigns relied heavily on Facebook page updates and email updates featuring instructor artwork and free tips for artists. They also offered a long-term low subscription rate for early adopters.
In keeping with its business plan, FitVine Wine attained profitability 3.5 years after launch. The founders say they accomplished this by starting first in the DTC market and then moved into retail. The consumer-focused products of FitVine Wine motivated their customers to promote their products and help drive the company’s growth.
Investing and planning before launch
As previously referenced, New Masters Academy built up an extensive trove of reference images and 3D models for its online art classes before it even went live. This attracted subscribers to join, sweetened by the Academy’s great deal for early adopters as promoted with a pre-launch marketing campaign. So, when the content-rich website launched, it became profitable within the first month.
