Food/Drug
These retailers know how to sort things out

Internet Retailer Top 500 Guide

Food/Drug CarolsDaughter.com Drugstore.com FoodNetworkStore.com HarryandDavid.com KLWines.com LakeChamplainChocolates.com Lancome-USA.com MyMMs.com Romanicos.com Wine.com

Where to begin when walking into a giant grocery store or drugstore? There are virtually countless items on shelves spread across a vast number of aisles. How does one sort through everything to find what he needs as well as new products he might enjoy?

Online food and drug retailers are streamlining this daunting task, and in ways no stores could ever do.

HarryandDavid.com, for example, gives shoppers a gift guide that enables them to easily search by occasion, price, type of gift and type of recipient. It presents products with rich imagery and offers a zoom feature that allows shoppers to magnify product images. It also showcases videos that demonstrate how chocolates, baked goods and gift baskets are prepared.

KLWines.com recently redesigned its site to make it easier for shoppers who are not connoisseurs. New site navigation enables shoppers to sort products by variety, country, sub-region, price range, critics` scores and top picks. The products are accompanied by a wealth of educational information.

A competitor, Wine.com, similarly helps shoppers make their way through a vast assortment. Wine.com`s home page displays large headings including "Shop for wine" and "Send a gift." Clicking on "Send a gift" brings up a page showing a selection of options arranged by price, gift baskets and certificates, and selections from particular wine-making regions.

When it comes to makeup products, the choices are extensive. Lancome-USA.com redesigned its site this year to address this shopping challenge. Customers can select from drop-down menus their skin tone, eye color and hair color to quickly narrow the number of products and display only what best suits their features. The site soon will add some Web 2.0 tools that will enable customers to exchange beauty tips to further aid selecting beauty items.

30,000 SKUs are a lot to sort through. Drugstore.com features tabs atop every page for numerous categories of products to speed shoppers to the products they seek. And it has added skin and hair care analysis tools to sister-site Beauty.com, giving customers an online questionnaire that results in recommendations for skin or hair regimens from various brands.

We are family

Indeed, repeat and loyal customers--referred to as family members at Brooklyn, N.Y.-based CarolsDaughter.com--are a big part of the company`s success. Carols Daughter uses its web site to create a community, for instance by inviting visitors to join a "friends of the family" club that offers discounts and special privileges for a fee of $25 per year. Darren Orlando, director of direct to consumer sales, says family membership has grown to 8,000 in the last several years.

As part of the retailer`s close-knit approach, customers are regularly sent e-mails that alert them to new store openings, inform them about new products or provide personal messages from the company`s founder, Lisa Price. Price started a beauty business by selling products at flea markets and craft shows before launching a web site and opening her first store. While she now operates seven stores, web sales still account for about 50% of the retailer`s sales, Price says.

The company also uses celebrity spokeswomen like singer Mary J. Blige and actress Jada Pinkett Smith to build loyalty. For example, customers who make purchases are given early opportunities to purchase tickets to Blige`s concerts.

The site also points out unique attributes of its products, noting, for instance, which products have a high percentage of natural ingredients. It`s all part of an effort to appeal to a sophisticated clientele that is largely black and Hispanic, a market the company views as underserved.

Sucharita Mulpuru, a principal analyst at Forrester Research, agrees. "Carols Daughter is targeted at certain skin types and ethnic backgrounds," she says, "and there is a paucity of such products online." Back to Top

Earning the edge

With more than 30,000 SKUs, according to David Lonczak, Drugstore.com`s vice president and chief marketing officer, the site offers more products to customers than large drugstore chains like Walgreen`s. "The brick-and-mortar stores have to worry about shelf space and SKU movement," Lonczak explains.

The web site can prolong the life of products, he adds, because Drugstore.com is a national retailer and can buy in bulk before products are phased out. Even large drugstore chains cannot do that, says Lonczak, because they have to cater to the nuances in all their stores, where certain products might not sell as well in some geographic regions.

Drugstore.com`s sister site, Beauty.com, has initiated skin and hair care analysis tools. The site gives customers a questionnaire and then recommends a multi-branded hair- or skin-care regimen. Again, says Lonczak, "It`s better than what you`d get if you`d walk up to a cosmetics counter at Nordstrom or Macy`s," where clerks promote only a single brand. Beauty.com is just a click away from Drugstore.com. Each site prominently lists the other near the top of its home pages. Visitors can shop at both sites with a single cart at checkout.

"Their web site is very efficient," says Jim Okamura, senior partner with J.C. Williams Group Ltd. "Over time we`ve seen Drugstore.com really expand their offerings."

The site is chockfull of tabs on its home page, ranging from prescriptions to photo and electronics, from food and gourmet to sexual well being, from toys and games to vitamins.

When customers visit one department, the tabs of other departments accompany them. "Through our imagery and presentation, we`re trying to expose you to new products and offer an easier way to find them," says Lonczak.

Drugstore.com, based in Bellevue, Wash., also offers holiday items like gift bags and promotes products on a seasonal basis. "They have to do a good job at cross-selling to increase the typical sales order," says Okamura. "Their gift bags are a clever way to mix and match different items." Back to Top

Cooking good

Make no mistake about it, the FoodNetwork connection is still there. Tabs on the home page beckon visitors to shop for products, cookbooks and food not only by brand and category, but also through pages devoted to the TV network`s wide collection of shows and its stable of popular hosts.

A remake of the web site this fall, however, helped establish the site as great destination of its own for shoppers of kitchen and cookware and gourmet foods. Designed by Cooking.com, the relaunch catapulted FoodNetworkStore.com from a pretty basic "plug and play" template to an attractive, easy-to-navigate site that has added brands and gourmet food to its menu of products.

"We built a custom design," says Lia Buffa, director of new business and e-commerce for New York-based Food Network. "It`s easy to navigate, and it`s easier to make updates and changes. We can evaluate what`s working and make changes accordingly."

The site turned to Endeca Technologies Inc. to help shoppers narrow their searches for the products they are seeking.

The objective of the site improvements was to expand the inventory of products, at least in part to attract people from FoodNetwork.com who wanted more than just recipes and cooking tips. FoodNetworkStore.com now sells more than 20,000 items. "We wanted to provide our customers with the chance to get anything they would want and need," says Buffa.

Soon the site will add videos to help customers learn what products are for and how to use them.

Despite the site`s growing autonomy, however, it still benefits from the ties with all the partners in the Food Network nexus.

"They`ve done quite a nice job of integrating their shows and their personalities," says Jim Okamura, senior partner with J.C. Williams Group Ltd., a retail consulting firm. "The store itself represents the brand very well." Back to Top

A mouth-watering site

HarryandDavid.com sets the gold standard for presentation. In addition to rich, inviting photos of it products, the Medford, Ore.-based retailer enhances presentation with a zoom feature that magnifies sections of items displayed. Shoppers can use it to inspect the quality of its gourmet fruit, chocolates and baked goods. Videos that show how chocolates and baked goods and gift baskets are prepared and packed further titillate the senses. The site is designed to work at 800×600 screen resolution to accommodate shoppers with older computers.

"The mouth-watering product photography really makes you hungry," says Mark Lee, founder of The Mark Lee Group, a Charlottesville, Va.-based retail consulting firm.

As shoppers are pulled deeper into the site through the luscious photography and videos, the retailer employs subtle marketing strategies, such as detailed descriptions of how gift baskets are shipped. The site overcomes objections to shipping fruit across state lines with such statements as: "Our gifts are trucked under controlled temperatures to a major city near their destination, where they`re released to delivery services for final delivery."

As concerns over maintaining the quality of the item during shipping are overcome, consumers become more comfortable with the idea of adding to their purchase. "At each stage of the buying process, Harry & David attempts to get the shopper to add to their order, even during checkout," says Lee. "That`s great marketing."

Site navigation is made easy through use of a seasonal gift guide that allows shoppers to search for gifts by occasion, personality or price. Within the gift guide is a gift finder that allows shoppers to narrow their search by occasion, price, type of gift desired or type of recipient, such as business associate, flower lover, sweet tooth or grill master.

With such attention to detail HarryandDavid.com is a site that presents food at its best. Back to Top

Up from the cellar

But merchandising this forever-changing inventory, some of which arrives in small runs, has been a challenge for the Redwood City, Calif.-based merchant. "The last thing we want to do is have a rare wine for sale on our web site, have someone order it, and then have to contact them and say, `Thanks, but somebody just bought the last bottle in one of our stores,`" Zucker says.

K&L has addressed the challenge with a customized database that updates inventory on its KLWines.com in real time as soon as new shipments arrive and as soon as a bottle is sold online or in one of its three stores.

Many of K&L`s long-time customers are wine experts who come to its web site knowing what they want. But a recent site redesign makes shopping easier for a broader range of shoppers. A new navigation system lets shoppers sort wine selections by variety, country, sub-region, price range, critics` scores, and special designations like organic or top picks. Clicking each category narrows the selections.

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"The most impressive aspect of KLWines.com is the amount of education and detail provided for each product," says Steve Rowen, analyst with research and advisory firm RSR Research. "It`s clear that K&L values a customer-centric experience."

Customers are responding by spending more time shopping, Zucker says. "The average time on our site is up 14%," he says. "16% of shoppers now spend 10 to 30 minutes per session, and the longer they`re on, the more likely they are to convert." Back to Top

Chef`s choice

The original plan was to sell chocolates to retailers, and 25 years ago the fledgling company started fulfilling wholesale orders through a back alley door. But word spread fast through the streets of Burlington, and a constant stream of walk-up customers flooded the alley door. "We couldn`t keep people away," says Chris Middings, director of marketing and communications.

Lake Champlain Chocolates emerged as a combined wholesaler/retailer, with three shops in northern Vermont and more than 1,000 client retailer locations throughout the U.S. But since launching LakeChamplainChocolates.com in 1998, Internet shoppers searching for gourmet chocolates have made the web the company`s fastest-growing channel.

The site has cultivated its online market by catering to the primary needs of shoppers, most of whom want to buy the best chocolate available to give as gifts, Middings says. They also demand speed in shopping. As a result, the site`s search and navigation provide a fast interface for finding individual or packaged chocolates.

The retailer takes extra steps to ensure site speed, such as using minimal Java code to support images and developing software that routinely rids outdated clickstream data that can bog down network servers. It also monitors clickstreams to present packaged chocolates the way customers prefer to buy them.

"LakeChamplainChocolates.com is a very professional site that is not at odds with the company`s small-town feel," says Nikki Baird, managing partner with research and consulting firm RSR Research. "And not only are visuals great, they load fast."

Indeed, the site, which features high-end, mouth-watering photography throughout, hasn`t forgotten its roots and engages chocolate lovers with the personal touch of the chef. A Chocolate Connoisseur section, for instance, offers an inside look at the delectable dessert and lets visitors e-mail the chef for chocolate-making and -serving tips that only a chef could reveal. Back to Top

Looking beyond beauty

"We specifically wanted to go way out of the box," says Sara Williams, Lan­come`s vice president of e-commerce and customer relationships.

The objective was to study sites with a consumer`s eye. "We believed what was missing in the luxury industry was a focus on service," Williams says.

The goal was to give customers the same help in searching for beauty products they might receive from clerks at a store.

Digital Pulp, a New York-based web development firm that helped Lancome relaunch its site, spent hours at cosmetics counters in stores to understand what customers want.

"They`re trying to simulate the store experience, where somebody will tell you what goes with your skin color," says Sucharita Mulpuru, principal analyst at Boston-based Forrester Research Inc. "They`re trying to do it online."

The site enables customers to personalize their shopping for cosmetics, skin care products and other items by selecting from drop-down menus their skin tone, eye color and hair color and then seeing products that match those features. A "compare all" function was added--Lancome took that from the auto industry--so shoppers can compare styles, prices and brands.

Clicking on a category such as mascara in the navigation column on the left displays all products in that category. When the consumer clicks on one product the rest remain visible so she can skip around without using the back button.

New York-based Lancome also added a "discontinued item" tool so customers can find upgraded products similar to old favorites no longer available.

Lancome is working on a second redesign phase that will, among other things, let customers compare notes on products and exchange beauty tips.

The company`s web strategy is based on two principles, says Williams: The site is never finished, and the customer always comes first. Back to Top

Sweet personalization

First they get to select two out of 22 colors for their customized candy. Then they are allowed to select two short words to appear on half of the M&Ms in their order and two more words to appear on the other half. Finally, they choose from a selection of gift containers. And in the end, visitors can review exactly what their personalized M&Ms will look like before ordering.

"This is a great novelty item," says Sucharita Mulpuru, principal analyst at Cambridge, Mass.-based Forrester Research Inc. "They`re doing a great job of leveraging the web to allow customers to personalize the product. I suppose customers could call in and order customized M&Ms, but this is better because it allows them to see their M&Ms right on the screen."

Mulpuru views MyMMs.com as a leader because it challenges other retailers to think of more creative ways to customize their products. "There are so many opportunities for retailers to use the web to create product customization--they`ve only just scratched the surface. M&Ms is a good example of how retailers can take the next step. For virtually every product you can think of, there is room for some customization."

MyMMs.com also is shrewd when it comes to keeping visitors on the site, offering a variety of entertainments, including music, games and M&Ms online video. There is even a page where visitors can create their own M&Ms TV commercial character by choosing facial features, hairstyles, clothing and accessories.

And Mars isn`t skimping on getting the word out about its niche e-commerce site. Promotions include extensive advertising on TV as well as online banner ads on popular web sites. "They`ve obviously put a lot of media dollars into advertising this new feature," Mulpuru says. "They`re not afraid to show customers this is a unique and special web site that customers might not otherwise know about." Back to Top

Handmade fame

Bigai is the founder of Romanicos Chocolate, a brand whose reputation for rare delicacies has been catapulted by the Internet far beyond the confines of its Miami kitchen and single, adjacent store.

"Upon first visit to RomanicosChocolate.com, who would ever guess this chocolatier is a one-store retailer?" says Steve Rowen, an analyst with research and advisory firm RSR Research. "The site`s appearance is far more appetizing than that of many top chefs` high-budget cookbooks. The photography is first-rate. And the look and feel is exactly what is required for the world`s best known candy-makers to inspire impulse buys."

Bigai launched her brand two years ago by exhibiting at the industry Chocolate Show in New York. That led to exposure in national media, which led to the Academy Awards presenting her chocolates as gifts to Oscar winners.

And when the Food Network was looking for something unusual from Miami to feature on TV, it searched the web and found Romanicos Chocolate. The network has featured the chocolatier on its Road Tasters and Sugar Rush programs; videos of the programs run on YouTube as well as on the Romanicos site.

But Bigai hasn`t let the fast publicity change her personal style. Having noticed how her store customers like to select their own combination of chocolates in boxed assortments, she designed a feature that lets online shoppers do the same.

To address a problem with abandoned shopping carts, Bigai adjusted her site`s system for figuring the shipping weight of multiple-product orders. Shoppers now get an accurate preview of their shipping costs, resulting in fewer abandoned carts.

And she still sends out personal thank you cards with each order. Back to Top

Searching and learning

“It’s intimidating, and the names are hard to remember,” says Rich Bergsund, CEO of Wine.com. “Our industry’s unmet need is making people feel confident picking that next bottle. The more you know about wine, the more you’ll enjoy it.”

Making both the casual wine buyer as well as the connoisseur feel at home searching for the ideal wine is San Francisco-based Wine.com’s mission, he says.

“Wine.com makes it easy to shop for a large quantity of domestic and imported wine, and it has unusual home page mouse-over features that show current deals and how to get 1-cent shipping,” says David Schofman, an e-commerce consultant and the founder and former CEO of Callaway Golf Interactive.

Because some shoppers want to quickly buy a gift while others want to browse and dive into details about wines, Wine.com’s home page greets visitors with large headings of “Shop for wine,” “Send a gift” and “Learn about wine,” along with enticing details on a featured winery and special offers on multiple wine varieties. Clicking on “Send a gift” displays for shoppers a broad selection of options arranged by price, gift baskets and certificates, and selections from particular wine-making regions.

Shoppers who select “Learn about wine” can search or navigate by terms such as type of wine or region, or by sections filled with advice on selecting, tasting and serving wines. They can learn, for example, that Pinot Gris, a rich, fruit-laden wine from Oregon or the Alsace region of France, is a good alternative to Chardonnay, as is Savignon Blanc from the Marlborough region of New Zealand.

For the connoisseur who knows what she wants, Wine.com provides more sophisticated research tools. When a winery introduces a new wine, for instance, she can view that winery’s history of vintage ratings. “We help customers identify good new wines before they sell out,” Bergsund says. “That’s something you can’t do in a store.” Back to Top