Private investment firm Comvest Partners acquires the financially troubled e-retailer, which filed for Chapter 11 bankruptcy protection in March.
Today Web 2.0 is transforming Buy.com into a profitable and transparent web retailing operation, CEO Neel Grover told attendees June 11 during his day two keynote speech at the 2008 Internet Retailer Conference & Exhibition in Chicago.
It’s been a long journey since Buy.com ended 2000 as a public company with an operating loss of $130 million and a share of stock worth about 17 cents.
Today, Buy.com is privately held, became profitable 18 months ago and is using social networking and other Web 2.0 technology to transform the company into a virtual marketplace that will end the year with an inventory of 10 million SKUs, CEO Neel Grover told attendees today during his day two keynote speech at the Internet Retailer Conference & Exhibition in Chicago.
Buy.com and web retailers of all sizes are facing major challenges today. “The market is growing at the smallest annual rate since the launch of the Internet and it’s saturated with competition,” Grover said.
Today to stay ahead of the competition and build on annual web sales that now top $400 million, Buy.com, No. 33 in the Internet Retailer Top 500 Guide, has rebuilt multiple aspects of its e-commerce site to become more transparent to consumers. “Everything we do is to make customers feel more comfortable and make it more convenient to shop,” he said.
In the last year, Buy.com has launched a jewelry and watches online store with an inventory of more than 30,000 products, and begun showing BuyTV, a program that offers shoppers a variety of content in ways that combine e-commerce education with entertainment, on broadcast television. The weekly half-hour series is now available to more than 5.6 million households in Southern California, but Buy.com is making plans to go national in the near future. Current carriers include Time Warner Cable, Cox Cable, DirecTV, EchoStar and Dish Network.
“Buy TV takes the web site beyond two dimensions,” Grover told attendees. ‘We film three-minute segments that feature the product experts in each segment. This replicates the store experience.”
By building more transparency into the shopping experience, Buy.com also can drive more customer loyalty. Product pages now feature pricing that includes shipping costs and comparison price charts that show the lowest cost -- even if the better deal is on a competing web site. “The old model of pulling consumers into the web site is changing to a model where we are pushing everything out to the product page,” Grover said. “By engaging the customers more with information upfront we can drive higher conversion rates.”
To keep pace with a new generation of Internet shoppers, Buy.com also is developing social networking programs. In August Buy.com launched Garage Sale, a web page-based widget that enables consumers to sell their own goods directly on Facebook social networking pages. Buyers can purchase merchandise on the web pages without having to leave those pages to complete a transaction.
By the end of the year, Buy.com will expand its Garage Sale program to include other national social network sites. Buy.com recently posted a first quarter profit of $1.4 million, an increase of 138% compared to $568,000 a year earlier. The company is doing well in a more difficult retailing environment by understanding who its customers are and taking the mystery out of buying online.
That’s a lesson other retailers can learn from, Grover told attendees. “In the end you differentiate yourself by concentrating on your niche and becoming transparent to the customer.”