Monday, April 7, 2008

Why Corky Requires a Track Record for On-Line Only Retailers

Q: Just curious, why the 3-year on-line retail site policy? What a bummer! I am just starting my on-line business and would love to carry your products.

A: Hi CherryCherryTree Tots:

I didn't mean to offend you. I'll try to explain why this is a Corky policy and hopefully you'll understand even if you don't like the policy. Believe me in a few years you will love the policy.

When we started Corky, back in 1994 on-line shopping was not an available distribution channel so we built up a loyal specialty retailer base through a network of salespeople throughout the United States. Some of our customer relationships go back 15 years and through the years we've developed a partnership with many of our customers. Our customer retention rate is one of the highest in the industry and I attribute this two things 1) we provide a unique high quality product and 2) we respect the need for specialty retailers to offer a product to their customers that is not a commodity.

The Internet is an amazing distribution channel now. The interaction with consumers and retailers is exploding on-line and shows no chance of slowing down. We all, manufacturers like Corky and our retail buyers need to understand three things:

1) on-line selling/buying is here to stay and we all need to adapt to survive

2) there is a learning curve associated with selling online and its very tricky to master

3) there are overhead costs with selling on-line and this must be priced into the product

If a retailer owns a store front, to a large degree they understand overhead costs and the need to price these costs into products they sell. When these retailers venture on-line for the most part they are goal oriented and seek the help of experts to make their ventures a success. Paid search, keyword bidding, search engine optimization, link building, email marketing, pay per click advertising, pay per impression advertising, organic search, data feeds to shopping comparison sites, banner ads, contextual ads, keyword rich descriptions, meta tags, RSS feeds and so on are extremely critical to the success of an on-line specialty retailer.

It takes at least two years to master these techniques and set the stage for a profitable on-line venture. All to often Internet specialty retailer start-ups flame out because they don't take the time to master the skills needed for on-line success. When the implosion occurs and they're holding inventory of Corky coats it becomes a fire sale and affects every one of the retail relationships that we've cultivated for so long. The reach of the Internet is so huge that one Internet store liquidating twenty coats can cause irreparable damage to a brand like Corky & Company.

So why would we sell to a brand new store that's not on-line. Simply because if inventory needs to be liquidated it affects a very tiny geographic area and does little damage to a well known national brand. I interact with many of our customers at shows in New York and I have the opportunity to meet many people just starting out in specialty retailing. If they are going to be an on-line only venture, I try to provide some direction and insight into the tasks critical for success. My nature is to help people succeed and I love to see success stories. I accept the fact that I may be alienating some potentially great online customers, but I hope my advise and time is worth more than the opportunity to sell a few Corky coats.

I wish you all the best with your new venture and I hope you will come back and consider buying Corky coats in a couple years.

Ask Corky a question.

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