These three founders, fresh out of college, want to revolutionize retail.

Cologne-based Hendrik Lallensack, Mirco Meyer and Michael Müller have developed baoo, a "go to store app" that displays the availability of products in nearby stores in real time. A product search engine that wants to be so much more. Find out exactly how it works, what hurdles they had to contend with at the beginning, and whether the founders themselves are offline or online shoppers in an interview with Hendrik Lallensack.

How did you come up with the idea of founding your start-up?

The idea for baoo actually came to us at university. All three of us studied retail management with a focus on omni-channel at the RFH in Cologne. And one day in a lecture, a professor uttered the sentence: He believes that the Internet will be much more local & regional in the future. My co-founder Mirco made a note of this sentence and it stuck with him. And as chance would have it, the three of us sat together in the evening and thought about this sentence. It was clear to us that if the Internet has to be more local in the future, then brick-and-mortar retail will play a very important role. And for that, there has to be a platform that makes stationary shopping more targeted, more effective and easier. And above all, much more digital than we know it today. That's how the idea for baoo came about, and we started writing down the idea and developing a concept. So your team consists of your Uniclique, so to speak? You could say that. All three of us studied together, but we also knew each other before we started our retail management studies, because we all did a dual business degree beforehand and come from the retail industry, so the connection was always there.

What is it like to found a company right after university? What were your biggest challenges at the beginning? The biggest challenge was generally first getting to grips with being an entrepreneur and structuring ourselves and assigning tasks. We first had to grow into this role. But we managed to do that relatively quickly. Another big challenge was to build up the right network and make yourself heard. How did you do that?

First of all, we were at the Cologne Accelerator startup. There, we were made fundamentally fit in the topics of founding, financing and also MVP testing. But what helped us the most to build up a network was winning the science award of the EHI Foundation. Here we were able to win the prize in the category "Best start-up for innovation in the retail and consumer goods industry". We were nominated by our lecturer at the time, and the jury for the award also included familiar faces such as Tina Müller from Douglas or Christoph Werner from dm, who voted us into the final. So we were able to build up an initial network. That helped us a lot.

And how exactly does your business idea work?

With baoo, we have built a product search engine with a real-time availability check, so to speak. This means that you currently search for products, categories or brands that you would like to have and need in the free text search. Baoo then shows directly where and if the products are available and in your area. So as you know it classically from online shopping, you scroll through the products and choose what you like. And for the product, you then find the nearest store in the vicinity that now has it available. So in the end the way to the retailer is given, but you also have the possibility to choose another store, where the product might be cheaper.

How do you know what is available and where?

To guarantee the real-time availability check, we work very closely with our retail partners and network the system intelligently. We therefore receive the data from the merchandise management system of our retail partners and can thus guarantee real-time, as we know about the current stocks at all times through the link. However, a digital merchandise management system in the trading company is of course a basic prerequisite for being connected to baoo.

And how many partners are you currently working with?

At the beginning of the year, we launched our big lighthouse project with dm, which we then rolled out across Germany. There we had a very high demand for Corona quick tests when they first went on sale. We were therefore able to offer a good use case with our app.

In general, however, we are still in the soft launch phase, initially only in Cologne. However, we are currently in the process of connecting further partners in the background. These include large retail chains from the DIY, consumer electronics, cosmetics and food sectors, which are also very well known.

To what extent do you distinguish yourselves from other search engines? What makes you better than Google?

In the end, baoo is much more than just a search engine. Baoo is meant to be the ideal shopping channel for any situation. Of course, this starts with the product search. At the beginning, there is the basic need of the customer, that he needs and is looking for a specific product. Currently, we as consumers are still thinking in terms of regions: Which store do I have to go to in order to buy this product? At baoo, we turn the tables: For us, the search generally starts with the product.

But what is much more important than the product is that we integrate services such as Click& Collect, Click& Reserve, and Ship from Store in the background. This means, for example, that I can reserve a product in advance and then pick it up on my way home. Or another example: you're sitting in the park and feel like playing a game of basketball, and with baoo you can have a basketball delivered from a nearby sports store. So in the end, there's a lot more behind it: We wanted to be a platform that delivers the perfect shopping experience for every situation, no matter what you need, and does it simply and effectively. In this respect, we set ourselves apart from pure search engines. So you pick up the customer at his first need and deliver directly what he wants in the fastest way. But what about once the customers are in the store? Do they buy other products there than the ones they were looking for? Is there perhaps a spill-over effect for the partners? Unfortunately, we have not yet been able to investigate this area, as we are still lacking data. But what we definitely have an effect on is that we use baoo to bring customers to stores where they might not have expected to find certain products. A classic example here is: I fire up the grill in the evening and suddenly realize my gas bottle is empty, I need a new one. The first thing I would think about is: Where is the next gas station nearby where I can buy a gas bottle? But I might also find it in the hardware store around the corner, where I wouldn't have thought to find it. And that's how we manage with baoo to get customers into the partner stores who otherwise wouldn't have thought of the idea, and that's how new customers are won for the respective store.

Your product is specifically geared to brick-and-mortar retail. Critics would say that brick-and-mortar retail is already dead. How do you see that? Does brick-and-mortar retail still function at all, especially now after Corona?

I think so, that retail will continue to exist and will continue to be successful. However, only if the advantages and services are given to the customer in the right way, especially digitally.

Digitalization has accelerated once again, especially as a result of the pandemic, and digital shopping behavior in particular. Consumers are even more demanding and want more service in digital form, more access to information.

I also see great potential and opportunities for retailers, provided they are open to digital innovations. The key to success for retailers, and above all to survival for retailers, is definitely openness to digital innovations and transformations. Anyone who is closed to this has probably already given up.

And what about yourselves? Are you more of an online shopper or do you like to go downtown?

Personally, I like to go back to retail, especially when it comes to buying something right now. Then I use the local trade, because it is simply faster. But it depends a lot on the situation, of course. We are very hybrid in that respect. When it suits us better, we buy offline, and when it doesn't, we buy online. And we don't want to take away online shopping with baoo. Our goal is to combine the advantages of online shopping with those of offline shopping.

And last but not least: Your tip for other founders? "Get as much feedback as possible."

Thank you very much for the interview.

Hendrik Lallensack originally trained as a retail salesman and then studied retail management at the Rheinische Fachhochschule in Cologne. Together with fellow students Mirco Meyer and Michael Müller, he then founded baoo in November 2020. Since then, the three have been further developing their app and creating a product that can be used throughout Germany. In March of this year, they also won the EHI Foundation's Science Award in the "Best Startup" category.