Groupon says its focus is on the bottom line, rather than top-line growth.
A small e-retailer seeks fame and sales with a propose-your-own-price shopping tool.
For a small retailer trying to survive in the competitive world of e-commerce, standing out is vital. That’s why handbag and luggage retailer Ecommerce Superstores LLC, No. 976 in Internet Retailer’s Second 500 Guide, offers DealMaker, which lets shoppers propose their own prices for certain products.
For example, shoppers on CoolComputerBags.com, one of seven Ecommerce Superstore sites, see a Name Your Price link under about half of the products. When a consumer clicks on that link, she is prompted to enter her e-mail address, name of the product and proposed price. Within 24 hours, she will receive a message indicating whether the retailer has accepted the price.
An accepted offer comes with a promo code that activates the agreed-upon price at checkout; the average discount for consumers who had their prices accepted on CoolComputerBags.com runs $17.13, according to information on the site. If the retailer rejects the proposed price, the shopper still can receive a smaller discount on the item.
Ecommerce Superstores president and CEO Kathy Seigler says she spends 60 to 90 minutes each day going through DealMaker requests. In making her decisions, she weighs the demand for the product, current inventory and the price she paid suppliers.“The customers love it,” she says. “We can get more competitive without getting in a price war with our competitors. As long as we don’t lose money and we make enough to cover our costs, we’ll make a deal.”
In testing the DealMaker feature over the past six months, Ecommerce Superstores has increased conversions and, more importantly, created a buzz among shoppers, Seigler says, declining to give actual conversion rates.“We are doing something different and the customer remembers us for that,” Seigler says. “People are much more likely to share with their friends and talk about it. The majority of people fill out a comment in the DealMaker form and they all say, ‘This is so great. I can’t believe more people don’t do it.’”
Building a following among shoppers is especially important for Ecommerce Superstores, whose natural search results have suffered since Google Inc.’s Panda algorithm update earlier this year, she says; in general, the update put more emphasis on the quality of a web page, including both the quality of pages linking to a retailer’s web site and the content on the retailer’s own pages. “The Panda update is bothersome to me in general and I don’t like that Google has so much control over our traffic,” Seigler says. “I’d much rather have traffic come directly to our site because people have been talking about what we’re up to.”
She would not say how many site visitors use the DealMaker service, only saying that it is a small percentage. Seigler plans to make the Name Your Price link more prominent, as well as automate the process so that shoppers will be able to get immediate responses to their offers. CoolComputerBags.com is Ecommerce Superstores’ flagship site, and the retailer also operates YummiHandbags.com, BackpacksSuperstore.com, TheLuggageExperts.com, WeKnowWallets.com, DiaperBagsOnly.com, and Kakles.com.