May 21, 2008, 12:00 AM

Fingerhut plans to expand e-commerce in 2008

Catalog and online retailer Fingerhut Direct Marketing derived 33% of its $440 million in 2007 sales from the Internet and the company is looking to continue growing that channel.

Fingerhut Direct Marketing Inc. has grown e-commerce sales steadily in recent years, from $52 million in 2005 to $82 million in 2006 and $144 million in 2007. It has steadily honed its merchandising strategy on product pages and upgraded its web site’s technology, features and functions, all of which contributed to 75.6% sales growth last year.

To Fingerhut’s way of thinking, 2008 will bring more of the same pattern that it has followed for the past two years, with the web accounting for about 22% of total sales in 2006 and one-third in 2007. “In 2008 we will continue to invest in online media and convert more catalog customers to the web,” Brad Smith, vice president, e-commerce and digital marketing, tells Internet Retailer.

Site redesign has become an annual event for Fingerhut, with the 2006 version devoted to the credit-based buying options the e-commerce site offers. 2007 focused on the shopping experience and growth reflects Fingerhut’s continuing shift of sales to the web, Smith says.

E-commerce made up almost 33% of $440 million in total sales for 2007. That mix likely will shift upward for 2008, Smith says. 2008 initiatives include plans to implement a new site search tool from Mercado. “It was the best fit for helping us build merchandising around search results,” Smith says. Go-live is planned for late summer. Fingerhut, No. 96 in the Internet Retailer Top 500 Guide, also is contemplating customer ratings and reviews. “We’re not committed, but we’re doing some research,” Smith says.

Testing new functions and ideas will dominate 2008 and future years. “We will invest more money in online marketing, such as behavioral initiatives retargeting those who have abandoned the site,” he says. The company performed some behavioral testing in 2007 with the help of Dotomi Inc., an online advertising services company.

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