Fashion industry lessons apply to all e-commerce
If you sell from your Web site, do you generate enough profit to make your car payment? That’s the kind of question Ed Foy likes to ask when speaking to small businesses about e-commerce. That question emphasizes two of Foy’s key points. First, you can start small in e-commerce and jump in without trying to take over the world. Second, you focus on measurable numbers rather than emotions.
“If you know marketing, you can market on the Web. Don’t think it’s bigger than you are,” says Foy, co-founder and CEO of eFashionSolutions.com, a Web retailer for major celebrity fashion brands from stars like Jennifer Lopez, Nelly and DefJam mogul Russell Simmons. Everything was bigger than eFashionSolutions when Foy and his wife Jennifer started the company in a spare bedroom in their New Jersey home in 2000.
Now with almost 100 employees and nearly $30 million in revenue, Foy proves big companies can make money by outsourcing to him in Secaucus, N.J. Foy takes over the Web sales and marketing for clothing companies and handles Web sales, service and fulfillment for a contracted percentage.
“Your fulfillment department can be one $8 an hour employee with a digital camera,” Foy says. He and his wife started by pinning clothes to a cork board and using a consumer digital camera to grab the image. Five years later, they have hundreds of thousands of dollars in imaging equipment.
Foy believes even small companies should do their own e-commerce. “Leverage your own Web site. Links to send customers somewhere else is dumb.” A typical retailer will put your product on the same page with competitive products, which may cost you sales. When customers do buy, they will establish a relationship with the retailer. You want to get the customer data yourself and engage them online.
If his brother bought a hardware store, Foy would tell him to “get customer e-mail addresses at the counter when they buy, then send them a note. Thank them for their business, and ask one question: What could we have done better?” Mom and Pop stores can easily read all those responses personally, and if they pay attention, will get excellent advice.
As e-commerce transactions grow, your Web site information will become a focus group dream. You’ll have actual purchasing details from thousands of people. Foy mines that information for business intelligence he shares free with this partners.
“One product had a high return rate, but they didn’t notice it across their retail stores,” Foy says. “We had the information and noticed that 90% of the returns were because the product didn’t fit. They had a production problem in one factory, and we helped them find it and fix it.”
But Foy knows the Web is not magic. He tells his clothing suppliers they must “design good products, make sure they fit, and we’ll help get them to customers.” The business is your horse, the Web is your cart, and remember which comes first.
Standing in the background, eFashionSolutions puts up different front ends for each customer. Only a small tag saying “Powered by eFashionSolutions” can be seen on sites such as www.ShopJLo.com (Jennifer Lopez) and www.ShadyLtd.com (Eminem). The back-end transactions funnel through a single e-commerce engine for processing.
Another failing Foy sees in small business marketing is not leveraging their Web presence. “Put your Web address on every piece of collateral, advertising, boxes, bags and even price tags on your retail items,” says Foy. He believes small businesses can succeed on the Web if they think small, stay focused and grow intelligently: “Amazon is losing business to mom and pops stealing a few sales here and there.”
