How eBags Set Holiday, Annual Sales Records in 2011

Jan 07, 2012 2:26 AM  By

With apologies to Frank Sinatra, it was a very good year for online handbags and accessories seller eBags – as it set records for holiday and annual sales.

Holiday sales jumped 32% over last year and 26% for 2011. On Cyber Monday the company recorded its largest sale day ever – a 46% increase over Cyber Monday 2010.

Just how did eBags accomplish this? Peter Cobb, cofounder/senior vice president of eBags.com, says mobile shoppers helped boost holiday sales. Sales from mobile devices grew 187% this holiday season and accounted for 9% of eBags.com total sales — up from 3.9% last holiday season.

Of the visits to eBags.com this holiday season, 13.4% came from mobile devices compared to 5.8% during the same period in 2010. Cobb says tablet commerce accounted for 7% of the 13.4%, while 6.4% came from smart phones.

Total sales show tablets accounted for 7.1% of sales while smart phones accounted for 1.9%. “Clearly, tablet users are more likely to purchase than smart phone users,” Cobb says, “and when they do purchase, they have an average order value that is 25% higher than smart phone and 10% higher than PCs.”

As soon as holiday 2010 ended, Cobb says, “We met and identified shortcomings from site performance to product mix to customer care and fulfillment. We identified over 120 areas where we felt we could improve, some as simple as wanting longer hours taking customer care phone calls.”

Part of the company’s focus, Cobb says, was improving site performance. “It wasn’t that the eBags site performance was not solid, it was just that we believe that one must always push to have a lightning quick site while having plenty of visuals and product information.”

Cobb says the company wanted to work with brands “to make sure that we featured their hottest products. In some cases, we negotiated with brands to set aside product for eBags.com allowing us to feature their offering with special value pricing not found anywhere else. We ran these on eBags.com as Doorbusters and Steals of the Day which resonated with shoppers looking for a great deal.”

Cobb says eBags continually adds features and several tests were conducted up until Cyber Week “when we rolled out the winning test to 100% of the site visitors. In this case, it was a three-way test of various ways to display our 2.3 million customer reviews on our site. We added a persistent shopping cart so that the shopper always sees a mini-version of their cart in the upper right hand corner. Also, we tuned our onsite search.”

Shoppers have been trained by Google, YouTube, and other sites on how onsite search is the fastest way to get directly to the brand or product category of choice. “We continue to add videos to our site and most of our most popular products have a detailed explanation of the products features and benefits,” Cobb says.

Cobb points out that the company’s most effective video (the eBags TLS Mini) shows 52.3% of viewers are still watching at the 200-second mark. “That is amazing that over three minutes into a product video, half the audience is still watching,” Cobb says.

Cobb says the company model is drop-ship “so the beauty is that we feature full product offerings from our 550 brands and do not take the inventory risk or push products that we are stuck with.”

One of the hottest product categories this holiday season was Michael Kors watches, Cobb adds. “The fact that we sell Michael Kors handbags already made the decision to carry his watches and accessories pretty easy. Brand loyalty is prevalent in the fashion category, so if a woman is looking for Michael Kors, we have gotten pretty good at cross-merchandising to make sure she knows that we carry a full range of Michael Kors products.”

Another huge area “that we jumped on,” Cobb says, was tablet cases.

“We knew that iPads, Kindle Fires, and Nooks would be popular holiday gifts, so we loaded over 1,000 tablet cases in time for the holiday season,” Cobb says. “Customers responded, as it was our fastest growing product category.”

Ebags was aggressive on keywords and SEM. “We monitor 650,000 separate keywords, all managed in-house, primarily with custom-built technology,” Cobb explains. “It is a core competency and a reason we grew 32% this holiday season.”

For eBags.com, tablets are gaining market share at a faster pace, Cobb says.

“We think it is people who are sitting on their couches at home and enjoying the quick Internet access of their tablet while watching TV or relaxing. But make no mistake, Internet sales via tablet and smart phones are in their infancy and will continue to grow in the coming years.”

What’s in store for 2012?

“Some pretty exciting stuff,” Cobb says, declining any details.

Jim Tierney (jim.tierney@penton.com) is a senior writer for Multichannel Merchant. You can connect with him on Twitter (TierneyMCM) and LinkedIn, or call him at 203-358-4265.