Catalogers initially embraced the Web as a less expensive way to build their brand, attract customers, and generate sales. But they quickly realized that while a Website may not have the costs associated with producing and mailing a print catalog, upgrades and maintenance still take a budgetary toll.
“Websites aren’t like cars, in that the first car that comes off the production line has to be as perfect as the last one,” says Stan Fridstein, president of Westlake Village, CA-based consultancy Synapse Infusion Group. “Websites are a work in progress.” Sites need continual updates and upgrades, which means that the costs associated with the maintenance are continual as well.
That said, you can reduce those costs — without sacrificing the integrity of your site. Here’s how:
Eliminate unnecessary technology. “Catalogers have a tendency to use whizbang technology that will never have a measurable or reasonable ROI for them,” Fridstein says. “They should review their technology to see if it’s meaningful to their business or if it just sounds good. They must ask themselves, ‘Will this result in higher conversion rates, stickiness, or higher average order size?’ If not, they shouldn’t use it.”
For instance, Gardener’s Supply Co. found that in pursuit of profitability, reducing expenses, and growing sales, “we had to rein in our desire to do funky and quirky things with our site,” says Jeff Govoni, director of Web marketing for the Burlington, VT-based gardening supplies cataloger.
The cataloger used to feature about 50 of its best-sellers in labor-intensive multimedia displays — large “hero shots” with call-outs that customers could mouse over (use their mouse to glide the cursor over) to receive additional information. “We did user testing to see if customers were using the hero shots, and the information we found was sobering,” Govoni says. “Since so many customers bypassed the experience, we don’t know how well we might have sold those products otherwise.”
Gardener’s Supply pulled the displays from its site this past summer, just nine months after debuting them — a move that saved the company about $10,000 a year.
Simplify back-end administration. Some catalogers may be able to reduce Web maintenance expenses if they bring more control of their sites inhouse. “The biggest problem many catalogers that I talk to are having right now is that they have no administration systems — that is, nothing on their back end to administer any changes to their Website,” says Ken Burke, president/CEO of Petaluma, CA-based consultancy Multimedia Live. “They have to pay huge costs to have the Web developer get the job done.” And the “job” can range from updating product descriptions to redesigning the entire site.
“We had a client who spent $1 million a year to outsource its administration, and we brought that down to one-tenth of that, or $10,000 a month, by bringing administration inhouse” Burke says. One of the company’s merchandise managers now oversees the administration of the site.
Granted, bringing Web maintenance systems inhouse requires an initial outlay of cash. You could spend more than $1 million to implement an infrastructure that would allow you greater control. But the expenditure could yield savings in the long term.
Besides, many marketers create inhouse Web administration systems for far less than seven figures. Vero Beach, FL-based Calyx & Corolla, for instance, spent just $24,000 to build its inhouse system. Andy Williams, president/CEO of the floral gifts cataloger, says the move reduced the cataloger’s monthly Web maintenance costs from $17,000 a month to about $7,000 a month. “Before, we had an outside entity maintaining our site, and now that duty is done by an existing staffer,” he says. The $23 million company does not have a Web department. In fact, it has only 24 employees, two of whom are trained to back up the newly assigned Web manager.
Streamline communications. You should assign one qualified person to oversee Web administration and management. Fridstein says smaller catalogers often rely too much on the president or the CEO to work directly with technology vendors. “Many catalogers’ bills are run up because vendors didn’t understand what the client was trying to accomplish, and the owners weren’t Web savvy enough to provide specific direction,” he notes. “A Web manager doesn’t have to be a senior person, but he or she must have the wisdom to perform a cost-benefit analysis of a job. These people generally pay for themselves very quickly.”
Fridstein also suggests setting up an e-commerce committee within the company consisting of the most Net-knowledgeable employees from each department. A committee of catalog staff that gets together with the Web manager on a regular basis to discuss the strategy for the site can provide direction and focus for the cataloger’s overall Internet strategy. “It would allow a group from the company to determine the real objective of the Website from an Internet and an intranet point of view,” Fridstein says. “For example, someone from purchasing could say that if they can buy merchandise online, then they may be able to set up a system where the vendors they source from could manage their inventory via intranet.”
Use syndicated content. If you want to offer value-added editorial on your site to increase stickiness and encourage repeat visits, consider using syndicated content from companies such as YellowBrix.com, Moreover.com, and PRNewswire.com. This way, you don’t have to be distracted from your core business — selling merchandise — to constantly refresh content. “The syndicates offer articles, tips, cartoons, and news on any imaginable niche topic,” says Marcia Yudkin, Ph.D., president of Boston-based consultancy Creative Ways, “and they will stick a template on your site and update it remotely. The cataloger doesn’t need to do anything to change the content.” The cost for syndicated content ranges from free to a couple of hundred dollars a month.
Recycle pages. Yudkin also reminds catalogers that digital asset management of product photos and copy can save time and money when posting merchandise content online, especially seasonal product pages. Catalogers that have seasonal offerings may want to just save the pages with product and copy and repost them the next season with any necessary changes. “Why re-create this year’s Christmas page?” Yudkin says. “The chances that anyone will remember what last year’s page looked like is doubtful.” In fact, she adds, an element of familiarity may actually enhance the usability of the Website.
Don’t sacrifice quality. To put it another way, don’t get so overzealous in your desire to cut costs that you end up losing business. “I’ve been to some Websites that are full of errors,” such as misspellings and incorrect pricing, Yudkin says. “And because of the errors, the sites are losing sales. If there are too many typos or mistakes on the site, customers won’t trust the site, and they won’t buy from it.” And without enough top-line revenue, it doesn’t matter how much you cut from the bottom line.