UNDER THE RADAR - Philip McLaughlin, McSport:IF THE free market is a form of natural selection for the commercial world and the secret of survival is the ability to adapt to change, Philip McLaughlin is managing to stay well ahead of the evolutionary curve.
McLaughlin took over the family business, McLaughlin Sports, on the death of his father, Patrick, in 1993, turned it into a highly successful sports catalogue business – and last year added McSport.ie, now Ireland’s largest sports equipment website.
“There will always be a market for catalogues,” says McLaughlin (35). “People like to sit down and flick through the pages or get around the table to discuss the products with pals. But I knew the way forward was to try to harness the power of the net.”
So far it’s worked and McLaughlin believes the internet is his marketplace of the future. McSport.ie went live in October 2008 and is already generating about 10 per cent of the company’s total turnover of almost €3 million.
“We’re getting between 25,000 and 30,000 first-time hits a month, which is very promising, and I’d anticipate that in the next three years or so, more than 50 per cent of our business will be done through the website.”
The site itself took eight months and cost more than €100,000 to develop. That level of technical sophistication though allows the company to offer a range of more than 4,500 products, a good proportion of which, he says, simply couldn’t be found in any one real-world sports shop.
So convinced is McLaughlin of the power of the virtual marketplace that McSport.ie already has two Facebook pages, a basic page and a fan page, although he has ruled out the possibility of writing his own blog for the moment.
“With two small kids, a two- year-old and a three-year-old, there’s absolutely no way I’ll be blogging or Twittering or anything else anytime soon,” he laughs.
One difference the online ethos has made to the business is that McSport, previously a long-term advertiser in the Golden Pages, no longer does any print advertising.
“We found it very difficult to quantify the impact of the print advertising we did do. Was it working? Was it cost-effective? We couldn’t tell. But with search- engine optimisation and Google AdWords, we can be 100 per cent specific about the customer groups we want to target, and that makes financial sense.”
Moving such a large proportion of the business online means McSport.ie is well placed to achieve its next strategic target of expanding into the UK, where a VAT rate of just 15 per cent – compared with Ireland’s 21.5 per cent – makes prices much more competitive.
“The entire Irish sports market is only the same size as the markets for greater Manchester and greater Liverpool put together, so the opportunities in the UK are huge for a company like ours,” says McLaughlin.
“The website can be modified at the click of a few keys. It’s just a matter of changing the currency from euro to sterling. The biggest challenge is working out the finances and finding a partner – someone with expertise in the sports business or in e-commerce.”
While the online presence develops, McSport’s four print catalogues remain the core of the business. The largest is the multisport catalogue, which has 465 pages and a print run of 10,000 and is distributed to schools, gyms and leisure centres.
The next largest catalogue is aimed at the GAA and has been hugely successful since it first came out in 2007. There’s another for the rugby market and a fourth this year for swimmers.
“I suppose you could say we’re dipping our toes in the water,” McLaughlin puns apologetically.
petercluskey@ireland.com
ON THE RECORD
Company:McSport, www.McSport.ie
Job:managing director.
Age:35.
Background:After leaving St Michael's College, Ballsbridge, in 1992, he went travelling in the US. Returned home to help with the family business, McLaughlin Sports, when his father became ill and took over the business when he died in 1993. In 2001, began dealing directly with suppliers in the UK and sourcing brands to sell to schools and clubs directly. In 2002, printed first catalogue.
In 2003, he rebranded the business as McSport and in 2008 launched McSport.ie
Now looking at the possibility of expanding into the UK.
Challenges:"Getting over the comparisons that are inevitably made with prices on websites based in the UK, where VAT is just 15 per cent compared with 21.5 per cent here. Even though we buy our products at the same price as UK websites, VAT and freight costs can mean there's anything up to 15 per cent difference in the price."
Inspired by:"From a business point of view, I've always been a big fan of Mark McCormack and What They Don't Teach You at Harvard Business School. . .
“From a sports point of view, I’m inspired by Kevin Moran, and of course he made the jump into business very successfully.”
Most important thing learned so far:"I'm going to paraphrase the old saying, 'The harder I work, the luckier I get' and add a few words about the importance of having a life outside work. That's something too many self-made people, and too many hard workers in general, forget."
