Retailers shift their ad spending from TV, radio and print ads to digital ads.
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In a crowded online retail market, of course, a primary strategy of any merchant is to differentiate from the competition. Not even every candy retailer is the same.
Take CandyWarehouse.com Inc., which partly competes with Candy.com, though it does more than $10 million in annual sales and focuses more on bulk shipments to clients such as hotels and cruise lines. "We're not an impulse candy buy, but more for party and event planners," says Christopher Pratt, founder and president. "We have orders of over $60,000 for certain projects."
Deliver before it melts
CandyWarehouse launched in 1998 on one of the Internet's earliest shopping cart platforms, Viaweb, which was subsequently acquired by Yahoo Inc. and became part of the widely deployed Yahoo Store platform, now known officially as Yahoo Merchant Solutions.
The Yahoo technology served it well for years, partly because Pratt, with an engineering background, was able to tweak the shopping cart to include a shipping calculator crucial for delivering large orders of chocolate so it wouldn't arrive melted. In his early days online, Pratt would simply set a policy of not shipping any candy that might melt via ground service after May 1. But that policy caused many customers in cooler regions or with short shipping distances to unnecessarily pay higher air rates.
The modified calculator automatically figured the time it would take to ship an order via ground or air based on a customer's ZIP code, factoring in the time of year and average temperatures. If the calculator indicated that ordered candy would melt before delivery via ground service, the cart would automatically require the purchaser to choose shipment via air. "You'd be surprised how many people try to save money by shipping Hershey's Kisses via ground in July, and then want their money back when they arrive melted," Pratt says.
But if the calculator determined the chocolate wouldn't melt, the cart still offered the less costly ground shipping as an option. As a result, CandyWarehouse.com boosted conversion rates, Pratt says.
As its business grew, however, CandyWarehouse wanted to offer more delivery options through a simpler interface—but that required a more flexible shopping cart platform, Pratt adds. Earlier this year, after working with consultants FitForCommerce to find new e-commerce technology and back-end business operations software, the retailer migrated to a new shopping cart on an e-commerce platform from AmericanEagle.com Inc. The cart software integrates with Microsoft Corp.'s Dynamics enterprise resource planning software, which handles such tasks as inventory management and financial accounting.
The new set-up, Pratt says, allows CandyWarehouse to present a more sophisticated shipping interface to consumers. Shoppers now can more easily place orders indicating separate air shipments for candy likely to melt during delivery and ground shipments for other candy, or override the air shipment requirement if they agree to take the risk of receiving melted chocolate. The AmericanEagle.com system also comes with more capabilities for running merchandising promotions and for factoring in sales tax through a plug-in with tax calculation software from SpeedTax Inc.
If the glove fits ...
Another retailer that has evolved along with its shopping cart technology is Gloves Online Inc., which has a history of designing and manufacturing fashion and industrial gloves. The company contracts with manufacturers overseas to produce the gloves, and sells its products exclusively through Gloves-Online.com. But even as Gloves Online has migrated to a more sophisticated online shopping cart, it has retained control over the technology in-house, says McGarry, the company president.
With about $5 million in online sales annually, the retailer has avoided moving to a new shopping cart on an e-commerce platform with comprehensive web site development and maintenance services. Such options usually require placing too many eggs in one technology basket, and paying a high price, he says. Instead, "what we do is pretty lean and mean—and at less cost," McGarry says.
Gloves Online traded its initial shopping cart—which McGarry described as "primitive" with little functionality or features—for e-commerce technology from Ecommerce Templates. The vendor provides a core shopping cart that the retailer can modify without excessive expense, McGarry says; the vendor's one-time fee of $159 includes six months of support.
For example, the technology supports Gloves Online's sales to consumers in more than 30 countries in Europe, the Middle East and Asia with a cart that accommodates foreign shipping addresses. The cart also integrates with the T-Hub order management system from Atandra LLC, which channels Gloves Online's orders to QuickBooks accounting software from Intuit Inc. for updating financial records, and to UPS and the United States Postal Service to generate shipping labels.
Laura looks ahead
The evolution toward a more functional e-commerce site is taking a different road at Laura Canada, a chain of more than 100 women's apparel stores across Canada that's developing its first transactional e-commerce site for its four brands: Laura, Laura Petite, Laura Plus and Laura Petite Plus. After a technology and strategy review with e-commerce consultants Digital Prophets Network, the retailer decided to build its site, due for launch this fall, on Internet-hosted, software-as-a-service technology from OrderDynamics.
"Laura has to launch an e-commerce site that can instantly compete with the well-known brands that have been running e-commerce operations for years," says Sam Barnes, Laura Canada's director of e-commerce.
With OrderDynamics' technology, the retailer will be able to operate its e-commerce site on a single technology platform supported by Laura's back-end business operations software from Epicor, including inventory management, product pricing, order fulfillment and customer relationship management systems, he says. "This will enable a more engaging online experience as well as streamlined operations," Barnes says. "We expect to be constantly optimizing our user experience with OrderDynamics personalization, merchandising and promotional capabilities."
And with additional capabilities, like built-in tools for optimizing its site for natural search rankings and the capability to add a mobile version of its site, Barnes figures Laura's e-commerce needs should be set for the long term.