From Traditional Wholesalers to the Web: A Success Story

Just selling something--even if it's a great idea--cannot always guarantee success online. Michael Schriner shares his eight-step web approach for successful selling on the web.

Our company, MicroVision Computer Products, designs and manufactures computer accessories. Primarily we sell our products to companies who place their brand name on our products and sell them in the retail and distributor channels (this is known as OEM). Our products will generally be found in a Staples, Office Depot, Office Max, under the brand names of Kensington, Curtis, or Fellowes.

Our sales had grown to about 4 million dollars annually, but began to level off in 1995. The problem was that the retail industry had begun a dramatic consolidation. Many of the retailers in our industry were either merging or shutting down their operations as competition became fierce. As a result, over a 10 month period, in 1995, the computer accessory industry was reduced to 6 major competitors (Office Max, Office Depot, Staples, Comp USA, Circuit City, and Computer City). What was once a vibrant industry, with over 100 retailers distributing our products, was now controlled by six retail chains. This small group of buyers represented over 90% of our revenue.

With such a dramatic consolidation over such a short period of time, we were not prepared for the changes. As with most industries that consolidate into a small group of buyers, it is not uncommon for each buyer to change the conditions of how he or she purchases a new product. All of a sudden, the product development and creative new ideas we produced were less important than the overall programs that the buyers began demanding. It was not unusual for a retail buyer to ask for several hundred thousand dollars just to place our products on their shelves.

Previously a new product would be placed on the shelf based on its uniqueness and salability. Until now, it had been unheard of to be charged for shelf space.

With so few competitors and the high price of doing business it became necessary for us to look at other alternatives to increase our sales. Thus, in late 1995, I began researching the sales and development opportunities of the Internet.

I Quickly found out that we had two things going in our favor. First, our computer accessories could benefit anyone who accesses the web. The reason is simple: everyone who accesses the Internet is using a computer. Second, our products were new and different. We have always focused on creative space-saving solutions for the desktop that are not only functional but unique. Many times over the last 12 years, our products have been copied by our competitors. I guess that's the highest form of praise, even if it does cost us lost income.

In my research I have found that the average netcitizen is looking for information that tantalizes while educates. These unique individuals are highly educated, and have been overexposed to junk mail. Despite their savvy, they are unable to differentiate between a valid offer and a con. Just selling something--even if it's a great idea--cannot always guarantee success online.

With all that I had learned at the end of 1995, I decided to take a eight step approach to setting up our business on the Web.

First, I created several new accessories specifically tailored to our target audience.

Second, I set up a professional website to feature these new products. I made sure to pick a short address for my website name so that it would be easy to remember. I chose one of our product names, and listed the site as http://www.webpads.com/.

Third, I added stories to the website that entertained and educated my audience about my products.

Fourth, I obtained reviews in the trade press of my new products. For credibility, I then took excerpts from the reviews and put them on a review page.

Fifth, I posted messages all over the Internet on bulletin boards, newsgroups, and other websites to ask people to come to my new site to read my reviews and stories. I was very careful not to just advertise my new products (people are turned off by advertisements).

Sixth, I ran a small weekly contest. For each person who registered I took the opportunity to send a return e-mail inviting them to visit places on my website that they may have overlooked when they filled out my form.

Seventh, I wrote a personal message to my audience explaining our company goals, and I provided a company information profile. I knew it was important to let people know more about us, not just about our products.

And finally, and most importantly, I had patience. You must be willing to wait long enough for results. No one is sure of the time frame, but I decided to wait 6 months before thinking about changing my strategy.

With these eight steps implemented in early 1996, it was time to sit back and wait. As I suspected things were very slow in the beginning. I added a counter to site so that I could check every several hours to see if I was getting traffic. At first I only received an average of 12 visitors a day. Once the contest started my traffic increased to about 100 people a day, but sales were few and far between. I still was patient, after about three months I noticed both an increase in traffic and an increase in sales. Visitors were becoming very friendly and sent e-mails complimenting the website. I began noticing repeat customers and many referral customers.

Word of our products began to spread and sales continued to grow. People liked our new products, they liked our service, and they actually felt entertained and educated by the time they left our website. Finally, after about 5 months I could see the light at the end of the tunnel. Since then we have had a continual increase in sales and traffic to our site. People trust our company, and are not afraid to buy.

This marketing approach has been very beneficial for us. I believe that the Internet is a wonderful opportunity for people to succeed in business, as long as they make sure to properly target and understand the market. Oh yes, and have a lot of patience.

Michael Schriner is President of MicroVision Computer Products. This article originally appeared in the Virtual PROMOTE Gazette.


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