lessons | Aqua Vita

3.14.2011
ecommerce, Serious Stuff

Ecommerce Lessons: From Neuropsychology to Laptop Accessory Sales

Published by Jessica Cox under ecommerce, Serious Stuff

Practical ecommerce interviewed Kathy Seigler, CEO and president of Ecommerce Superstores.

This Bowling Green, Ky.-based online retail brand has six niche online shops: CoolComputerBags.com — which was launched in 2007 — and five other specialty retail shops all launched in 2010.

They are: BackpacksSuperstore.com, TheLuggageExperts.com, YummiHandbags.com, DiaperBagsOnly.com, and WeKnowWallets.com.

From Neuropsychology to Ecommerce

Seigler started her retail business on eBay in 2006. With no previous ecommerce experience a background as a neuropsychologist. After about 6 months of selling on eBay, she identified a marketplace niche for laptop bags and launched CoolComputerBags.com in late 2007. In 2010, CoolComputerBags.com recorded gross revenues of roughly $815,000.

“Each of our now six sites specialize in a single product category,” Seigler says. “And all of the sites share the same navigation, functionality and shopping cart. The sites are also color coded, which differentiates each one, but all with the same template. We are still experimenting with our design and testing to see which converts best.”

Biggest Mistakes

“Where to begin? My first mistake was not being educated enough about the ecommerce industry as a whole. I didn’t know what I was getting into, but sometimes that’s the best way to start. Experience is the only way to learn.

“My second biggest mistake was trying to grow too fast too soon. Grow gradually and make sure spending is in line with revenue.

“Which brings me to my third biggest mistake: return on investment. Do not do things because they are ‘industry standard.’ Unless you see a measurable return on your investment, whether it is in marketing or staffing or inventory management — make sure it is paying for itself.

“Another big mistake I made was not having a fool-proof methodology for product upload. This is probably the single most costly error you can make in ecommerce. In the past 4 years I’ve made more mistakes than not. But I keep trying and my persistence will hopefully pay off. If not, I’ll write a bestseller about what to do when starting an online business.”

Biggest Successes

“Our biggest success is having a number one ranking in Google for the most relevant terms related to CoolComputerBags.com. I’m also very proud of being selected as one of the ‘Hot 100 Best Retail Websites’ by Internet Retailer.”

Best Advice

“Watch every single penny and be careful not to get sold on the latest thing that is promised to increase sales, traffic or conversion. Also, surround yourself with excellent people who lift you up every day professionally and personally. Life’s too short not to.”

Orders, Inventory and Shipping

“We work with about 60 different suppliers currently. We stock some inventory as well as work with vendors that drop ship.”

“To manage the entire inventory for so many different stores, we have a nice piece of software that allows the vendors to manage inventory themselves. It is a third party extension specifically developed for Magento. For those vendors who choose not to do that, they email us when items are out of stock and our inventory manager is responsible for updating it.

“We have an RSS feed that tells us when we are running low on stock. We only stock the minimum for products that sell through slowly. It’s a very difficult thing to balance, especially during the holidays.

“Our average [shipping] cost-per-parcel is about $9. Drop ship vendors receive email notifications that also include a packing slip and a shipping label. The software does have the ability to be automated, but we manually review each order ourselves before sending them to the vendors for the sake of accuracy and so we can stay on top of our orders and customer’s needs.”

Caring Customer Service

“On the customer service end of things, we have a fantastic lady, DeAnna Roberts, who takes phone calls and replies to emails. I manage live chat myself and I really enjoy it. I’m proud to say that we do not have very many instances where customers are unhappy. In those times when we have messed up royally, we tell the customer we will do whatever it takes to make them happy — then, we do it.

“I’ve gone so far as to send flowers to a customer who we forgot to refund for about 6 months. We also send $5 Starbucks cards and personal notes to customers when we are at fault.”

PPC Marketing Experiment

“Our marketing strategy varies. We lost a lot of money last year trying pay-per-click (PPC) advertising. We never arrived at a profitable result. We lost about $50,000 in just three months. I would not advise anyone to attempt PPC unless they have about $100,000 to spend ‘testing’ it.”

Aqua Vita PPC Note: Testing is key. When you are starting out, don’t bid for the number one spot. Watch your keyword bids and total expenditures like a hawk.

Cull keywords that do not result in conversions or email sign-ups. If a keyword group gets too competitive and expensive for you to make a profit, drop your bid prices so you aren’t competing with the big fish in that pond.

Think maximum ROI for each click you pay for. Make sure you push email sign-ups to get PPC visitors into your marketing list. That way you get more than one opportunity to market to these expensive visitors.

Facebook and Twitter for Ecommerce

“As far as Facebook and Twitter go, we post our email campaigns, special offers and have contests. We also have the ability for customers to share on every product page.

“But to be honest I still haven’t figured out yet how to leverage Facebook and Twitter to increase sales. We are considering an extension that allows us to sell on Facebook directly called ‘Facebook Shopializable.’ And I’m very keen on having an ‘incentive to Like’ functionality.

“I think the genius of social media is if a business comes up with something revolutionary, like Groupon did. That’s something people really want to talk about and it spreads like wildfire. Otherwise, you are a nameless face in a sea of millions on Facebook”

“The reason I think it’s important, however, is for rankings. It’s no secret that Google has incorporated the Facebook ‘Likes’ into its algorithm, which makes a lot of sense. Word on the street is that ‘Likes’ will eventually replace ‘links.’”

Get the full story and more ecommerce tips at Practical ecommerce.

12.31.2009
Eureka!

10 Things I Learned about Business in 2009 – Part Two

Published by Jonathan Cox under Eureka!

6. Know your products…

…inside and out. You can get an excellent feel for what works and what doesn’t by making note of your weakest products, your strongest products, and the price points each sells for.

Earlier this year, I spent a fair chunk of time and money creating a couple of new product packages for folks that needed a simple startup site. It wasn’t successful. Fortunately, I keep records of sales meetings on new products, so I began to review them to look for the problem.

After much weeping and gnashing of teeth, I discovered two things:

People didn’t like the configuration of the payment plan. They would rather pay 50% down, 50% after than to pay it over a year. It didn’t matter that it was no-interest financing. Since this product was for new customers and we hadn’t built up a history of trust, they felt bound by a year-long commitment to a company they didn’t yet know.
We were selling it to the wrong people. Because of the lower cost, we thought this would be ideal for individuals or businesses with less than 3 employees and a slim gross margin. In actuality, the product was more ideally suited to companies with 5-10 employees, but a heftier gross margin.

Never stop analyzing what you do and why you do it. Never stop analyzing your sales process, and your customer satisfaction levels with your products and services.

7. Know your customers

Only recently have I really begun to understand how freaking useful the concept of “target demographics” can be.

A few weeks ago, I decided it was time to stop making “educated guesses” on who our target market should be, and sat down to compile a list of our best customers.

By the time I had finished this list, I was staggered by how similar profiles were on the customers that we most enjoy working with. They were all within ten years of each other in age; most were the same gender, and all of them were hard working, long range planners with lots of passion and creativity within their industry.

Armed with that knowledge, I now know exactly where to spend my time and money in marketing. When I walk in to a networking event, I now know exactly what kind of person to look for. Conversely, I also know who not to look for, and sometimes that’s even more useful.

8. Know your employees

Your most valuable resources are your employees, and I’ve had the great fortune to work for very different leaderships types, and to observe how they utilized their manpower.

Here is, in my experience, the correct way to work with employees:

First of all, be selective in your hiring process. Never, ever hire in the initial interview, and only hire people who are able to prove, extensively, that they’re sane, talented people with a good track record. One of the nice things about this economy is that there are a lot of awesome, talented men and women out there who were laid off for some unfortunate reason. In difficult times, you can often find available talent that would otherwise be difficult to acquire.

Second, communicate often with your employees and listen very seriously to what they have to say, even if your immediate reaction is to disagree with them. If you’ve hired this person based on the criteria outlined above, they’re smart, experienced and gifted in their field.

By listening to employees and trusting their opinion when I’m less experienced on a topic, I’ve been able to save myself a lot of stress and heartache. And let me just say, it’s a good thing for my customers that I let my marketing, writing and design specialists make the hard calls on the projects that they’re working on.

Now, that said, there are times when even a smart, experienced and gifted person is incorrect, and you’ve got to have the guts to stand for what you believe is right, even if it means conflict. Conflict is uncomfortable, but if you can’t handle it you shouldn’t be running a business. You’ll get skinned alive by people who take advantage of accommodating people.

9. Know yourself

How passionate are you about what you’re doing? If you hate your job, you’re in the wrong industry. Quit being a pansy, save up a cash cushion and get the hell out. Go find something you LOVE to do, that gives you a sense of purpose and a feeling of accomplishment.

That said, I have a hard job. I often work 10-14 hours a day, 6-7 days a week. It’s rare that I ever have a weekend off, and I’ve really had to bust it to make Aqua Vita a successful design firm, especially considering this is our first year as a full-time business, AND it’s a recession year. There have been whole weeks that have blended together as a blur of finances, planning, programming, phone calls, meetings and coffee drinking…but I wouldn’t have it any other way.

I love what I do, and I’ve been told in no uncertain words by my customers that the work we do for them relieves stress, boosts sales, production and productivity…and it’s shiny!

I know that I’m in the right industry, that because I enjoy what I’m doing I’ll succeed at it where many have failed, and that I’ll have a hell of a lot of fun while I’m at it. After all, I get to an insider glimpse on how dozens of different business models work; I make pretty, functional things; and I play on the computer for a living. AWESOME.

10. Work your butt off and save

There you go: the secret to success. There are no magic pills, no financial fads or marketing schemes that’ll put that beautiful green in the bank. The best way to get rich and stay rich is to work smarter, harder and longer than any of your competitors, pay cash for everything, and save 5-10%, minimally, of everything you earn, forever. If you don’t have a 5-10% margin over your bills, get a second job.

As someone who’s played the credit card game, I can tell you that it sucks. Interest rates are higher than ever, and you DO have to pay those loans back. Shred those cards and never use them again, if you can help it.

Ah, and one more thing: A year ago, I would tell myself that if I couldn’t put huge chunks of money back, it wasn’t worth it at all. As an experiment, I went ahead and started saving 4% of my income, just to see what the emotional and fiscal benefits from it would be.

Now that I’ve completed that little experiment, here are my findings: It IS worth it, and I’ve gone from 4% to 15% of my personal income. The result is that I feel happier, less pressured, and freer in my financial decisions. If I want to take a vacation, I just reach into a little horde of cash I’ve set back for just such a purpose, and I pay for it with the lean green stuff. The result is a guilt-free, interest-free getaway.

That’s it folks! If you’ve got any comments, please post them below. I read each and every one, and I’m happy to answer any questions you might have about how Aqua Vita works, what we offer, and how I’ve turned the nightmare this year has been into a shining success.

See you on the flip side.

12.30.2009
Eureka!

10 Things I Learned About Business In 2009 – Part One

Published by Jonathan Cox under Eureka!

1. Be ethical

Times are tough, and sales are more difficult to come by in many industries. There are those who price gouge, or leave their customers high and dry at the first sign of complaint, and they get away with it, right?

It’s rough being one of the good guys right now, keeping prices fair and placing high importance on customer service and quality assurance. But don’t be duped. What goes around comes around. If you work hard and you’re good to your customers, it’ll pay back in spades.

The number one reason my company is thriving this year when so many are struggling is because of our customers. We call them to check in after a project is done, we give them discounts for purchasing our services in volume, and we’re on call for them 24/7 in case of emergencies. We treat them like family.

As a result, they continue to do business with us, and even refer new clients to us. Being ethical, even when it’s hard, especially when it’s hard, always pays. Period.

2. Study, study, study

This one is so important, especially in our industry, where things are always changing. As the owner of Aqua Vita Creative, I spend a great deal of time studying ways to improve our products and production levels. I read books on marketing, finance, design, and programming.

I attend industry seminars, and this year I’ll be attending tradeshows and conventions to keep abreast of the latest technology that I can offer my customers.

Knowing your business inside and out gives you an edge over competitors that are just in it for a paycheck. It means faster turnaround times on jobs, which means lower expenses for you and lower prices for your customers, and lower prices mean higher demand.

3. Plan, plan, plan

The longer I’ve been in business, the more I see the incredible time and money saving practice of planning. There’s an old saying: “Plan your work and work your plan.” Man, that’s the truth. My experience has been that one hour of planning saves me 10 hours of work. That’s not an exaggeration.

Here are a few things I plan for Aqua Vita:

- Finances.I spend about a half hour every day planning Aqua Vita’s finances, specifically our budget, savings plan, and a plan for investments over the next financial quarter (new software, equipment, promotional materials, extended education, etc.)

- My days. I spend about 15-30 minutes every night preparing a To-Do list for the next day.

- Sales.I have a 30-minute sales meeting with my sales and marketing director every Monday morning to review prospects and sales for the week, and I have another 30-minute strategy session at week’s end to review the week.

I’ve seen incredible boosts in my focus, drive and productivity when I plan thoroughly.

4. Schedule everything

If it ain’t scheduled, it ain’t happenin’. There are plenty of sales guys, techs and marketing professionals who have no shortage of talent, but can’t keep a deadline to save their life. My observation has been that most of the time, it’s not because the person couldn’t meet the deadline; it’s just because a deadline wasn’t set at all.

Frankly, I’m astonished at how few people schedule things considering the nasty stuff that happens when you don’t. Forgotten appointments, angry customers, broken trust with employees, and hours wasted every day. Yeesh. Schedule everything you can as quickly as you can and save yourself the headache and heartache.

5. Always have a next step

When I first started in sales, I noticed that even though I was having some really great conversations with prospects, the relationship never seemed to go anywhere. Then I realized the problem: I was leaving conversations with no game plan for the future.

Now, I try to set up an action at the end of every meeting, call, and e-mail correspondence. This practice builds real relationships with your clients. You’ll talk more, and you’ll come to know and trust each other better than you would have otherwise. In my case, doing this has dramatically improved my sales, too, and I won’t lie: I like sales.

Check back tomorrow for the rest of the list!