Former eBay Seller Starts Stootsi.com Using Old-School Approach
By Greg Holden
Sometimes, the best way to do ecommerce is to go back to school - the "old school." After selling a million items in seven years on eBay, Bryan Corbett decided to go back to basics - selling one item at a time; controlling transactions so they proceed as smoothly as possible, and being able to call customers personally on the phone when needed.
"It was getting very hard to make money on eBay," says Corbett, 29. "And even though we have shipped a million products through eBay, people will say they bought those products on eBay, not from us. We wanted to build our own brand to gain repeat buyers."
Corbett started Stootsi.com in 2006. He and his partners began by borrowing a business strategy that had been tried by the Web site Woot.com and by television shopping networks: offering a "Daily Deal," one item being put on sale at a deep discount each day at noon. The purchase has to be made within a limited amount of time.
"We were perhaps third to market with the idea of a "deal of the day," and we instantly got traffic," says Corbett. "We lucked out with the timing of it." From the start, Stootsi.com was getting 20,000 visitors each day. Corbett built on this success by pursuing a second tried-and-true, old school business strategy: drawing on a database of 1.5 million previous customers and telling them about the site.
The next approach: build a store full of products so people coming to Stootsi for the daily deal would stick around and shop for other merchandise. It would be a store built on top-notch customer service that incorporates another "old school" approach: personal attention.
"We want to be able to call our customers on the phone," says Corbett. "For orders over a certain dollar amount, we go the extra mile and verify the order. We say, "We just wanted to make sure that this is you and that you are the credit card holder." Buyers are surprised to get the phone call, but they aren't bothered at all, and they typically thank us for checking. It's a myth that people don't want to be communicated with personally on the Internet, that they want to shop anonymously."
Corbett, who describes himself as a "finance major and a geek on the side," has always been interested in business strategies. He runs Stootsi.com from the hill country of western Pennsylvania; Lead Programmer Brian Hulick is 29, and Webmaster Jeremy Palermo is 26.
The young developers are looking to Amazon.com as a model for many of their business strategies. One of Amazon's approaches - hand-picking sellers and allowing them to offer their own products in the marketplace - became Stootsi.com's next big business strategy in 2008.
"With all the changes in the feedback system and the institution of DSR ratings, it was getting really tough to run a business on eBay," explains Corbett. "We wanted our own sales experience to be available for other sellers - good sellers, businesses with whom we have already established relationships."
Stootsi.com began looking for businesses to offer their own products through a third-party marketplace on its site. They hand-picked businesses they already knew, as well as current eBay sellers, to help test the system. Choosing companies individually enabled them to control how fast they grew. "My main concern with opening it up to anybody was that I don't want to become eBay. I don't want our site to become unmanageable."
After a test period last fall, the marketplace is up in running. But Corbett still considers it a "work in progress." And more importantly, he still exercises control over who can sell.
"Our goal is to go out and find smaller to mid-size companies that sell online full-time. We approach people who have 500 to 1000 products listed on eBay. We introduce ourselves, tell them what we have to offer, and tell them that we want you to run your business on our site. We ask you to ship as quickly as possible and upload your shipping order numbers to us. We charge you a flat 5 percent fee if something sells. In return, you can brand yourself on our home page and establish yourself as a seller."
In just a few months, Stootsi.com has grown to 250 hand-picked sellers that offer 150,000 products on the site. Many sell electronics and computer-related products. Lately, Corbett and his staff have been seeking out sellers who offer specialty products such as golf equipment. The third-party marketplace, Stootsi Sell, now allows individual sellers to open their own stores, but all individuals are checked to make sure they have a legitimate address and phone number.
Stootsi.com is now well known for offering its "daily deal." In fact, the site publicizes its daily offering on Twitter. Recently, they offered the popular Guitar Hero 2 game for the Xbox for $19.99 rather than the usual retail price of $24.99. The site sold 1500 copies in a single day.
"A big part of our traffic is people who come to our site every day at noon to see what the deal is, and then leave five minutes later," comments Corbett. "Our goal now is to convey to buyers that we are more than a deal - we are a daily deal plus and million other products."
Accordingly, Stootsi has expanded to include a variety of specialty marketplaces. One area of the site, Stootsi Chaos, features special deals taken from Stootsi's own inventory. Another, Stootsi Salvage, features distressed and non-working products at "next to nothing" prices.
These days, Bryan Corbett finds satisfaction from making his own sales using "old school" approaches, and helping other sellers do the same. "When we run a popular deal, it's fun for me to watch thousands of people buy something at a crazy price," he says. "When that happens, two people win. It tells me we're doing something right, and buyers are getting a great deal. Second, in the third-party marketplace, it is very satisfying to know we're able to help someone save money compared to other marketplaces. We know exactly how they feel and what they're looking for. It's a joy for me to hear someone on the phone say they're selling product on our site and loving it."
About the author:
Greg Holden is EcommerceBytes Contributing Editor. He is a journalist and the author of many books, including "Starting an Online Business For Dummies," "Go Google: 20 Ways to Reach More Customers and Build Revenue with Google Business Tools," and several books about eBay, including "How to Do Everything with Your eBay Business," second edition, and "Secrets of the eBay Millionaires," both published by Osborne-McGraw Hill. Find out more on Greg's website, which includes his blog, a list of his books, and his fiction and biographical writing.
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