Exciting Commerce // Unlimited

Impressions From The Zazzle Headquarters in Redwood City

With its mass customization strategy, Zazzle counts as one of Exciting Commerce’s international favorites.

Frank Pillar recently visited the Zazzle headquarters in Redwood City in California and has summarized 10 observations on Zazzle’s business model.

And here a few other impressions gathered from an Exciting Commerce visit last Fall:

Related posts:

• Zazzle Launches International Operations in Europe
• Artsprojekt: How Zazzle Wants to Conquer the Boarder Scene
• Keds Studio: How Zazzle Is Revolutionizing the World of Shoes

Originally posted in German by Jochen Krisch, adapted for excitingcommerce.com by Jason Soo.

Pitchmen: What E-commerce Can Learn From Television

Conventional online merchants are investing more and more search engine optimization effort for their exorbitant shops and portals. However businesses of the “Exciting Commerce” variety, such as Vente-Privée, Woot and Threadless, are able to concentrate fully on sales optimization (revenue/min or contribution margin/min) due to their streamlined product lines.

In their fixation on Google Search, internet mail-order businesses often miss out on what is happening on the other end of the spectrum. Fortune offered a few interesting perspectives on direct response TV (“Secrets of the TV Pitchmen”):

"Put it all together, and the once-fringe world of DRTV is becoming more mainstream every day.

Networks like Fox News have opened up prime, never-before-available slots to DRTV ads. And the owners of established brands, long resistant to direct-response spots, are beginning to experiment more.

"It's like this recession has caused corporate America to come alive," says Tim Hawthorne."

The TV merchants have yet to discover the internet. We’re excited to see what kind of push they’ll be able to add to the online markets. It wouldn’t hurt the e-commerce industry to have a little bit more product cult.

Originally posted in German by Jochen Krisch, adapted for excitingcommerce.com by Jason Soo.

Shortlist of German Language E-commerce Blogs

Netzwertig, the #1 amongst German language techblog, has followed up on the initative from StyleSpion and has shortlisted a number German language techblogs worth keeping track of.

           (“A ♥ for Blogs”)

Since Exciting Commerce had the unexpected honor of being named one of Germany's top tech blogs, we felt compelled to join in on the movement and list out the most valuable German language e-commerce blogs which come to mind. This may be of particular interest to English speaking readers who, faced with the annoying dependence on translation tools, may want to focus in on key sources of German related e-commerce news.

• Alexander Ringsdorff’s Blog: Alexander Ringsdorff (CEO of Visions new media GmbH) has only recently started blogging, but hopefully will continue to for quite some time on several topics of e-commerce including Magento.

• Boersma Zwischendurch: e-commerce strategist Thorsten Boersma writes only sporadically. But what he writes is mandatory reading for anyone interested in the developments in the fashion industry.

• helloingo: With Ingo Schnall there is finally an industry expert who is both competent and committed to blogging on teleshopping und videocommerce, for us an Exciting Commerce blog honorary.

• Kassenzone: The New Business strategists from Otto Group, Alexander Graf and Florian Hermsdorf started their private blog one year ago to write about market developments in the e-commerce-area.

• KAT Mailorderblog: Mail-order expert Martin Groß-Albenhausen thinks beyond the confines of the traditional catalog mail-order business and delivers a very unique perspective on e-commerce developments.

• LiveShopping-Aktuell: This blog from the similarly named live shopping portal, although in recent times a bit inactive, remains a good source of information for live shopping fans.

• Mail-Men: It's hard to categorize the blog from Sven Sawatzki. It covers a lot of what others don’t. His focus lies with the big name mail-order houses.

• Shopbetreiber-Blog: Ulrich Hafenbradl and his Trusted Shop Team demonstrate how a commercially successful business blog can look like. If you overlook the self-promotion it's still the best blog for traditional e-commerce topics.

StyleSpion claimed that the German blogosphere is stuck in a depression. But that can’t be said for the e-commerce area, which has on offer dozens of blogs of every color and flavour. Further tips are e-driven, Handelskraft, Handmade 2.0, Shopanbieter, Shopping 2.0, and perhaps more to be named here.

Originally posted in German by Jochen Krisch, adapted for excitingcommerce.com by Jason Soo.

Custom Fit Shopping System or Off-The-Shelf Solution?

There’s been a lively discussion in the last couple of days on the German language blog, started by the observation (German post) that several Top 500 German online shops are choosing to custom-develop their own shopping systems rather than go for off-the-shelf standard solutions.

Jochen Krisch and several German readers have compiled a list of prominent online businesses.

Some apparent examples are the live shopping type sites: Guut and Swoopo, and the mass customization type sites Spreadshirt, MyMüsli, and Panemeo (who re-uses the MyMuesli shopping platform), as well as private shopping clubs Brands4Friends and BuyVIP.

Other less obvious examples besides the big name Amazon and eBay are marketplace type sites such as: DaWanda, Gimahhot, Hitmeister, and Trade-a-Game.

Further on the list are Inkpool/Computer-Pool, Notebooksbilliger, StyleOn and Lost Legends.

A peculiar trends seems to be in the pet and animal care industry, where a large number of businesses have gone the custom solution route: Zooplus, Petshop, Tiierisch and Wauzikontor. An open question is what solution the giant pet supplier Fressnapf (1.1 billion Euros revenue) is going to use. They have already announced a (re-)launch of online sales activity for the Fall of 2009.

It would seem that the large shop system manufacturers have simply focussed too long on the requirements of assumed “Big Players” from the multi-channel and mail order industries, rather than on the needs of pure Internet-based players. According to Jochen Krisch (German post):

"Standard shop systems are often only appropriate as solutions for novices to online retail - for small merchants, mail-order companies and brick-and-mortar stores."

Further indicative of this assumption is Jochen's observation that newcomer Magento was the first shop system producer to deliver a solution for private sales clubs.

Related German posts and commentaries:

• Panemeo: MyMüsli ermöglicht eigene Brotmischungen
• Haustierbranche bevorzugt eigenentwickelte Shopsysteme
• Auch Zooplus und StyleOn setzen auf eigene Shopsysteme
• Auch Petshop und Inkpool setzen auf eigene Shoppingsysteme

Originally a number of posts in German by Jochen Krisch, adapted for excitingcommerce.com by Jason Soo.

Empora for Fashion: Pixsta Drives Visual Fashion Search Forward

Aside from an impressive presentation at the Pangora Kongress, there hasn’t been any recent news from the visual search company Pixsta. That just made its current return with Empora all the more spectacular:

Empora is the first fashion search engine that succeeds in implicitly conveying all visual search options in a way which makes it genuinely entertaining to shop and browse.

Other sites are comparatively awkward such as like.com (where you need to work with charts and category lists), as well as the German sites Stylefruits and Stylight.

The British contender’s site on the other hand, definitely stimulates a desire for more browsing. And we are excited to see how established online fashion stores like ASOS, Yoox and Co. are going to react.

Originally posted in German by Jochen Krisch, adapted for excitingcommerce.com by Jason Soo.

Magento Introduces Module for Private Sales Events

Varien, the company behind Magento, has introduced the Magento Enterprise version in a webcast which, according to our knowledge, is the first shopping system with integrated event and invitation module for shopping club concepts:

The implementation (construction and maintenance of the events, etc.) is relatively straightforward. It remains to be seen if this is a solution for specialists with a multitude of events - and the corresponding volume of pictures and data.

This is however, certainly an option for merchants with a regular shop who would like to run a club on the side for clearing out overstock items, etc. Portero Private is the first club based on the Magento solution:

The Magento Enterprise version should cost $8,900 per year for a production server license and $2,225 per year for a non-production server license.

Amongst the new features are for example, gift certificates in variable denominations which customers can issue and then send to their friends by email or post.

Besides the Enterprise version, a free open source Community Edition will continue to be available. This version has recently celebrated its first birthday.

Magento has brought new impetus to the e-commerce scene in its first year, although continues to take flak due to performance issues. At the time of this post however, we haven’t heard of any independent performance tests which objectively clarifies this issue (such as case with Oxid or other open source solutions).

Addtional information on the Enterprise Edition in the German blog from Alexander Ringsdorff.

Related posts:

• Magento Announces Shopping Solution for Private Club Sales Model

Originally posted in German by Jochen Krisch, adapted for excitingcommerce.com by Jason Soo.

Amiando: eventSense and a Good Sense for the Web

Amiando, the undisputed leader at the Exciting Commerce Stars 2008, lives up to its reputation in 2009. They are consistently moving forward with their networking strategy. Along with widgets, ViralTickets, seamless integration to external websites and the integration with Facebook Connect, Amiando now has eventSense. With eventSense, Amiando is launching further distribution and marketing opportunities for conference and event organizers (German press release, PDF).

Decentralized Event Marketing

eventSense is performance oriented and takes its cue from Google AdSense. For that reason, perhaps at first the effort doesn’t appear to be very spectacular. But for Amiando it is the logical next step. And one starts to wonder, why isn’t there a JobSense, TravelSense, a RealtySense and so on? At least there is type of StyleSense in the works (German press release, PDF)

At latest since Google stormed the scene do companies realize how lucrative it can be to think in terms of platforms, services and leveraging networkability. Nevertheless it feels here in Germany like 999 from a thousand internet companies (and 990 from a thousand startups) have a traditional marketplace or portal business model instead of one focussed on tools and services.

Of course, Amiando could have evolved into something of a MyHammer, eBay, or Expedia - and end up offering the ultimate event directory. But somehow the team at Amiando succeeds in convincing its investors of its vision and is able to present itself as a service starting from Day 1. As a result, even to this day you won’t find a category overview or prominent search function on the site.

What would Amiando do?

Not surprisingly, people are not giving enough credit to the site which is already helping to organize thousands (according to Amiando, over 50,000) large and small events with participant logistics and marketing. That’s due to the fact that the marketing occurs largely decentralized and is user driven. With eventSense, Amiando can spread it’s presence further and also work with event organisers who don’t have any online presence and have scant experience with online marketing.

Amiando is and remains an epiphany of immense strategic value and is from our point of view the only German internet company who will be able to keep up with the Facebooks and Googles of this world. Perhaps someday instead of people asking themselves “What would Google do?”, they’ll be asking “What would Amiando do?”. We, at least, are excited about Amiando’s future.

In comparison, EventBrite is also worth a look. They have more features, but at the same time, a much more conventional strategy.

Related post:

• Facebook's Mark Zuckerberg in Germany

Originally posted in German by Jochen Krisch, adapted for excitingcommerce.com by Jason Soo.

Buying and Selling: eBay Pushes Ahead in Reverse Gear

Probably eBay would be happiest if they could turn the clock back to 2003/2004 when everything was hunky-dory in eBay’s world.

As announced over the weekend, eBay has jettisoned StumbleUpon, wants to get rid of Skype and instead invest in GMarket in Korea.

Nobody mistrusts the user driven Web now more than eBay. Assuming that, these moves are not at all surprising.

However eBay is not interested in going back to their roots. Because instead of many small buyers and sellers, eBay would rather focus on the heavyweights (“Diamondsellers”) who would offer fixed price deals and overstock items.

eBay will be publicizing its quarterly figures in the next few weeks. The newest changes analysed here.

Related posts:

• eBay Launches First Open Social Applications
• eBay and the (Decreasing) Importance of Community
• EBay Live! 2008: eBay on Reconciliation Course

Originally posted in German by Jochen Krisch, adapted for excitingcommerce.com by Jason Soo.

Top 500 Shops: Swoopo Nabs 10 Million in Financing

The Germany based Entertainment Shopping AG raised $10 million from US sources for its Swoopo (formerly Telebid) website (press release). This makes it now the third German startup (after Spreadshirt and BuyVIP) which has an alternative e-commerce model and has in the past few weeks announced a big finance round.

Swoopo counts amongst the top 500 German online shops and has surpassed its 2008 revenue target by hitting close to 22 million Euros (2007: 11 million, 2006: 5 million).

Under the control of former Ciao CEO Gunnar Piening, Swoopo is in the process of branching out its business model to other markets. Now with the support of American VCs August Capital Partners, its sights are firmly set on the US market:

Swoopo founder and inventor Manfred Hasseler is in the meanwhile going his own way. At the moment he is putting focus on his new project Cooni (German site), which like Luupo revolves around a reverse auction model where the product prices are hidden.

Live and entertainment shopping formats such as these are an eyebrow raising trend in e-commerce (GE/EN). They revolve around dynamic pricing and leverage the flexibility of the internet medium much more than other shopping sites. They are especially serving the needs of online users who crave for more variety and pure excitement during the shopping process.

Related posts:

• First Spreadshirt, then BuyVIP, Kennet Partners On Shopping Spree

• Luupo and Successors: Cooni, McEuro, xgewinnt and Others

Originally posted in German by Jochen Krisch, adapted for excitingcommerce.com by Jason Soo.

First Spreadshirt, then BuyVIP, Kennet Partners On Shopping Spree

The big (e-commerce) investor of the hour is currently Kennet Partners. The growth stage financiers seem dead set on quickly dispensing up to $300 million.

As such, Spreadshirt (10 million Euro round in February), plus a string of other startups, and now BuyVIP (14.9 million Euros) are profiting from the Briton’s generous mood.

Kennet investment manager Maximillian Bleyleben has analysed the growing market for shopping clubs in his blog:

"What we like about this market in particular (apart from the explosive growth) is that private online outlets are becoming a key distribution channel for brands. 

At €1bn+ in 2008 and growing, it's a channel that the fashion industry is starting to build into regular supply chain plans.  We're already seeing this concept evolve from a way to dispose of excess inventory into an incremental outlet for current-season goods. 

Picking the best business to back in this market seems difficult on the surface.  There are 3 or 4 European players that have shown great traction in their home territory, including Brand Alley (GB), Brands4Friends (DE), Privalia (ES), Private Outlet/Andrino Group (FR).

Most have received hefty doses of growth financing from angels and VCs.  But we had to choose, and we're excited to back BuyVIP for several reasons."

With strong pressure coming from Vente-Privée, BuyVIP must - as does Brands4Friends - fuel their expansion at any price. Accordingly thin is this ice on which they are dancing. In other words they are both high risk investments that can only go well with some luck to back them up. In contrast to Vente-Privée, both competitors haven’t seen much enthusiasm from the members they’ve collected with their million Euro marketing budgets.

The current daily traffic numbers turn out to be pretty meagre in relation to the membership numbers (the specific numbers for Germany here). An improvement could be expected once the relationships with the designers and manufacturers solidify and if we see consistently attractive sales campaigns. The big question is only if Vente-Privée gives them the chance.

According to BuyVIP, they are profitable and have now raised over 25 million Euros of capital. At that level they would be clearly ahead of Brands4Friends, who are up to 16 million Euros now after their latest round of 10 million. BuyVIP are thus showing increasing confidence in interviews.

At the Live Shopping Days conference in Berlin, BuyVIP founder Gerald Heydenreich made remarks on the success factors of shopping clubs in a video interview (German language).

Originally posted in German by Jochen Krisch, adapted for excitingcommerce.com by Jason Soo.