A Profitero study showed Target’s online prices were 25% more expensive than Wal-Mart’s, which were just slightly more expensive than prices on Amazon.
Traffic to CookiesByDesign.com is about to explode, but the CEO isn’t worried—for a change.
Peak sales periods used to be like “dancing with death,” says Jack Long, CEO of Cookies By Design Inc., which sells online and through about 100 franchised shops around the country. He never knew if his e-commerce site, CookiesByDesign.com, would stand up to spikes in traffic.
He had cause to worry. The site went down about a half-dozen times in the year before he found a new web hosting service early in 2012. Once the site was down for eight hours, another time for four hours. He figures the site averages about $5,000 an hour in sales, so those two outages alone cost him $60,000. Cookies by Design sells about $30 million in cookie gift baskets a year, with 54% of that, or just over $16 million, online.
Long especially worried as his big holidays approached: Valentine’s Day, Mother’s Day and Christmas. But he says he’s not worried now, even though he expects sales to spike next week in the three days ahead of Valentine’s Day on Thursday. He expects 600,000 page views per day during those peak days, up from an average of 80,000 on a normal day, but he’s confident the site will stand up to the strain.
That confidence comes from his experience in the past year since he moved the hosting of CookiesByDesign.com to Hosting, which operates six data centers around the country and provides web hosting, data storage and computing capacity through its cloud of web-based servers to some 5,000 clients.
Long did more than change vendors—he went from owning his own servers, which were housed by an outside firm, to leasing computing capacity from Hosting.com, which operates some 4,000 physical servers. Those servers are divided up by virtualization software to act as though they are 11,000 “virtual servers,” each able to store data and handle computing tasks the way a physical computer would have in the days before virtualization made it possible to compartmentalize the power of a single machine.
The advantage of a virtual server is that if the physical machine it’s running on goes down, Hosting.com can automatically transfer its tasks to another physical server, says Joel Daly, chief operating officer of Hosting.
Long likes the fact that he has only one company to call if a problem arises. In the past, he says, he could not immediately tell if the problem was with the roughly 10 servers he owned—which ranged in age from three to six years—or with the company that was hosting those machines and connecting them to the web.
Long says he would have been willing “to pay a wee bit more” for the peace of mind of having one company handling his web site and offering redundancy in case of machine failure. In fact, he says, he’s paying about the same as he did before—about $10,000 a month. And he doesn’t have to invest in replacing servers as they age. He says the machines he previously owned cost about $300,000-$400,000 to purchase.
The e-retailer leases four physical machines from Hosting—which means CookiesByDesign.com uses the full capacity of those servers. In that situation, Daly says, Hosting pairs each physical server with another that can take over if the first machine fails. In addition, CookiesByDesign.com uses around 10 virtual servers at any time, that is, portions of the computing capacity of servers owned by Hosting. Daly says Hosting charges CookiesByDesign.com $820 per month for each physical server and $530 per month for a virtual server.
Long says he’s so satisfied with the Hosting service that he’s planning to spend about another $2,000 per month for the company to host a point-of-sale application for Cookies by Design franchise shops.
Most importantly, Long says he has no worries as the Valentine’s Day rush approaches. Hosting.com lets him “burst up,” that is, add extra capacity when traffic spikes, and he now can handle 48,000 customer visits at a time. That’s about double what he could handle previously, he says, “but even then we were dancing with death. We did have the ability to burst up, but it was only as good as our hardware. That was the problem.” Now, he says, it’s solved, and he’s ready for the Valentine’s Day rush.