Groupon says its focus is on the bottom line, rather than top-line growth.
Online food and drug retailers are streamlining the daunting task of finding a virtually countless number of items
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.
Shopping online for skin care products is not easy since customers can`t smell them or test a sample against their skin. But CarolsDaughter.com gets around some of these obstacles by creating families of products that its customers come to know. Arranged around the themes of its six fragrance lines, once a customer finds a fragrance she likes in one product, she can easily find on the web site all the other products in that fragrance 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
Drugstore.com thinks it has an edge over its brick-and-mortar competition.
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.