February 13, 2004, 12:00 AM

Valentine shoppers boost VermontTeddyBear.com sales to yearly highs

This week, holiday orders peak at about 2,000 orders per hour. With a million visitors during February and 30% of annual revenues coming in, the company looks to the Yahoo Store platform to help shoulder the load.

Plush bears and pajamas are helping to drive a Valentine`s Day sales spike at the four web sites of the Vermont Teddy Bear Co. Inc., where the holiday is expected to bring in 30% of the company’s annual $40 million in sales. Along with sister sites Tastygram.com and florist CalyxandCorolla.com, VermontTeddyBear.com and Pajamagram.com are generating traffic that’s up 20% over last February and beating the company’s forecasts.

Pajamagram.com alone has grown almost 100% to 435,000 visitors to date in February over last February’s 220,00 visitors. February conversions on both the Teddy bear and pajama sites are running above industry averages at more than 8%, webmaster Tom Funk tells Internet Retailer.

The sites’ biggest challenge during February is handling the extra traffic and keeping up with order fulfillment, Funk adds. “This is volume we are not generally prepared for during the rest of the year,” he says, noting that this week, Valentine’s Day-driven volume is peaking at more than 2,000 orders per hour, more than triple the volume during non-peak months.

To handle the extra volume the sites use Yahoo Store platform. “They have a lot of servers and bandwidth they can throw at our biggest holiday without us having to own a lot of server class computers,” says Funk. While the company also has its own internal hosting capability, the Yahoo capacity provides needed redundancy, he adds. During non-peak times, for example, the VermontTeddyBear.com domain is handled by the company’s own server, but during peak times it’s hosted by Yahoo. “We always have Yahoo, and we always have our own self hosted site, and we do a kind of load balancing manually,” says Funk.

Because the hosting charge is transaction based, Funk adds that Vermont Teddy Bear pays for the extra capacity only when it needs it. “We’ll pay from $10,000 to $20,000 in transaction fees for hosting this month, but in a quiet month, we might pay only around $1,000,” he says. “For us it’s a cost effective solution. A lot of e-commerce merchants may spend anywhere from a few percent to 5% of their revenues on hosting and software licensing. We spend from less than one half percent to 1% of the year’s volume on server hosting and other software.”

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