Why—and how—some employers encourage online shopping at work
By Paul Demery
When The Buckle Inc. wanted to extend its reach to sell its apparel fashions
for young people, it went to where the money is: the wallet-wielding parents
of its typical 12- to 24-year-old customers. And it reached them where commerce-supporting
bandwidth is greatest—at the office.
The Buckle and dozens of other companies sell directly to consumers through
corporate intranets and web sites under an arrangement with Xylo.com, a unit
of Workstream Inc., an Ottawa-based company that focuses on providing a broad
range of human resources programs designed to help employers acquire, develop
and retain employees.
Actually providing the means to complete shopping at work lands some employers
smack in the middle of the debate about shopping at work: Some argue that such
shopping saps employee productivity and puts a burden on bandwidth that a company
pays for, after all, to conduct business. Others argue that it boosts morale
and actually makes employees more productive because it relieves the anxiety
of completing one more chore.
In fact, Workstream has based its business on the latter argument. And its
customers back it up. At Eddie Bauer Inc., Seattle-based unit of Spiegel Inc.
which sells apparel and recreational equipment at 500 stores and EddieBauer.com,
the corporate intranet and the ability it offers to shop from work plus discounts
on merchandise have proven to be among the most popular employee benefits. “It’s
very important to have a positive work environment to support employee morale,
and our employees appreciate the time savings to shop through the intranet,”
says Karl Weiss, manager of benefits for Eddie Bauer, which has offered a Xylo
shopping portal on its intranet for more than two years. “We do annual surveys
on the popularity of employee benefits, and it’s always one of the top things
that employees value about the workplace.”
Special discounts
Xylo’s specialty is in providing tools and content that help integrate employees
into the workplace and maintain high morale, says Art Halloran, president and
COO of Workstream. It does that by developing web pages, co-branded by Xylo
and its client employers, that offer information and services ranging from details
on corporate policies and health insurance to employee message boards and assistance
in joining carpools and company sports teams. But among the most popular offerings
delivered by Xylo and its corporate clients are shopping malls with links to
retailers, manufacturers and service providers that, through deals arranged
by Xylo, offer special discounts on products and services, such as 10% off the
price of a Dell computer, special deals on toys from Kmart, apparel from Buckle
or gifts from 1-800-Flowers.
Corporations
offering such shopping options to their employees include a diverse group such
as Eddie Bauer, Nordstrom Inc., Hewlett-Packard Co., Wells Fargo & Co. and
Northwest Airlines Inc. “A growing percent of online shopping is either completed
or at least initiated from the workplace,” says Lydia Pierson, director of e-commerce
for Kearney, Neb.-based Buckle, which operates more than 300 stores in 37 states
as well as the recently redesigned Buckle.com. “We’ve been very pleased with
the opportunity to reach our customers in their work environment and offer special
incentives.”
Buckle also reaches much of its primary audience of 12- to 24-year-old shoppers
through its Xylo connection. In all, there are more than 200 companies that
sell directly to employee-consumers through Xylo. Many of them are manufacturers
and service providers that see Xylo’s online arrangements as a way to reach
consumers and build relationships with them. “These consumers become very loyal
to the people who provide them with products and services,” Halloran says. “We’re
providing a unique situation for vendors, creating a close community for them.”
Halloran reports that Xylo shopping mall activity is rising in terms of number
of transactions and web site visitors. He said it did particularly well during
the 2002 holiday shopping season. In addition to Buckle and Dell, other vendors
include retailers Men’s Warehouse, Barnes & Noble and Shoes.com, and travel
industry providers American Airlines, Cendant Corp (which offers discounts at
hotel chains including Days Inn, Ramada Inn and Travelodge), travel services
organization Club Med and City Pass, which offers discounted tours of major
cities.
Halloran says Xylo does not offer exclusivity to retailers in any particular
online shopping mall, though retailers may arrange for an exclusive deal directly
with clients. He adds that clients at times will request having a new retailer
added to the Xylo system. Workstream would then approach that merchant and in
most cases make it available to all of its clients. He also notes that employers
have extensive control over which sellers appear in the co-branded shopping
malls and their content. “The employer has the option of reviewing what’s offered
and selecting or eliminating products or services we can provide through participating
vendors,” he says.
Boosting productivity
By developing intranets with multiple attractions, such as internal company
news and message boards, Xylo helps build traffic and the number of potential
customers for participating retailers and other service providers linked to
the intranet’s shopping mall section.
Although some employers worry about losing productivity by letting employees
shop online, Eddie Bauer finds the system actually helps productivity—-for management
as well as employees. “Everyone’s in a time crunch today, and nobody has time
to get things done,” Weiss says. “But if I can shop between projects, then I’ll
be more productive if I’m not worrying about how and when I’m going to get to
the shopping mall and to the post office to send a gift to my brother in Nebraska.”
He adds, “Our policy states that employees can spend a reasonable amount of
time shopping online, as long as they’re getting their work done. In an information
economy, employees know what their goals are and don’t need someone looking
over their shoulder.”
Moreover, the Xylo program saves Weiss himself a significant amount of time,
he says, because it frees him from having to deal directly with companies that
would provide employees with special offers on products and services. “I have
very little time in the day to coordinate with vendors, so this saves me a huge
amount of time,” he says.
With a workforce spread across the U.S. and Canada, Weiss adds, it would be
nearly impossible without a web-based system for him to establish a common program
of discounted shopping benefits for all employees. “It could be hard for me
to find someone in Wichita, Kan., to offer discounts on toys,” he says. With
the Xylo connection to his corporate intranet, a common discount shopping program
was immediately made available companywide. At the same time, if it wishes,
Eddie Bauer can establish web links to retailers and service providers in each
community where its store employees are located.
Getting set up with Xylo is fairly simple for both vendors and clients, its
participants say. Workstream charges client employers a fee based on number
of employees. The fees cover setting up and administering the content on the
co-branded web pages, which are hosted by Xylo. There are no transaction fees,
Halloran says.
Many employers create codes that employees must use to access their intranet
and shopping portals. At Eddie Bauer, employees who work in the company’s Seattle
headquarters use their company workstations to access the intranet and the co-branded
Eddie Bauer/Xylo sections. But employees who work in stores generally access
them through their home computers.
Intranets generally provide a link to the retailing site, which takes the
employee to a shopping page that is still framed by the corporate intranet.
While not all of the discounts that are available through the program are exclusive
to corporate employees, the intranets allow the corporations to highlight discounts
that an employee might not otherwise be aware of, Halloran says.
Halloran adds that Xylo has enabled Workstream to fill out its offerings in
human resources programs, which include web-based applicant-tracking systems
that can be used to manage large numbers of submitted resumes, outplacement
services and a planned online job board at SixFigure.com.
One retail shopping area where Xylo is currently lacking is in enabling clients’
employees to conduct their grocery shopping from their computers. “We used to
have HomeGrocer.com, so someone could get their food shopping done during their
lunch break,” Weiss says.
HomeGrocer, of course, is out of business. But with other grocers like Safeway
Inc. and Albertsons Inc. building up their web-based retailing operations, that’s
more food for thought for Xylo and its clients.
paul@verticalwebmedia.com
