SkyMall soars into e-commerce
Given the $30 million it can cost to build and market a comprehensive e-commerce site, most chief executive officers naturally want to see a return on the company's initial investment before committing more dollars for major upgrades. But Robert W. Worsley, CEO of Phoenix-based SkyMall Inc., has seen enough to know that e-commerce is a big part of his direct marketing and catalog company's future.
And that's why Worsley is giving the go-ahead to a $25 million project that includes overhauling SkyMall's e-commerce technical infrastructure and launching a major marketing campaign. "The tsunami of Internet shopping has blown through the books and music segments and into the general gift-giving category," Worsley says. "We must be a leader, not a follower, in this market." SkyMall, a large publisher of in-flight and specialty catalogs, will use some internal funds to pay for the upgrade, but most of the money will come from outside investors.
Major technical improvements to the site include installing new computer hardware and software that will reduce the time it takes to download SkyMall's online store page and the number of clicks it takes for shoppers to locate merchandise.
Worsley says it now takes customers between 14 and 16 seconds to access SkyMall's online store and six clicks to get to the merchandise. When the technical overhaul is completed by December, downloading the SkyMall store should take customers around eight seconds and no more than three clicks for them to locate specific merchandise.
Worsley says about one-third of the money raised from investors will be used to make technical improvements to SkyMall's e-commerce site. Plans are also in the works for a major online and offline marketing campaign, though details have yet to be released. "With the site's new plug-and-play and open architecture, we intend to focus on speed," he says. Web sales accounted for about 5% of SkyMall's revenues in 1998. SkyMall expects to grow Internet retailing sales to around 10% of total revenues in 1999.
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