Customer – Hitchens Hot Deals (Self-Service Solution)FROOITION FUELS HITCHENS HOT DEALS eMARKET SUCCESS

How Frooition helped Hitchens Retail build and operate a successful eBay presence
A fairly recent entrant to the eMarketplace, Hitchens Hot Deals is the e-commerce branch of Hitchens Retail, a multi-million pound chain of retail stores based in the Midlands and the North. It was originally acquired from Littlewoods in 2003 selling branded catalogue surplus and other surplus stock lines sourced from major mail order outlets and through an international network of manufacturers, importers and
distributors.

The stock is brand new and surplus to the original seller’s requirements - which is why it is available to customers at a fraction of its original selling price. Hitchens Hot Deals is now a leading premium provider of branded clothing, footwear, household and electrical products on eBay.

Established in November 2005, the company is currently trading at over £40,000 a week with a dedicated team of just six. The founders of the rapidly growing business are using automation software to scale up operations – based on a solid foundation of credible and professional design, professional training and supported self-service provided by Frooition with whom the company has partnered since April 2006. Here, Hot Deals director Malcolm Pearce describes the steps to success and how Frooition played a key role.
Opportunities

“When we looked at the Internet as a way of gearing up and automating our sales we saw both problems and opportunities,” says Pearce. “For customers, the Internet can be awkward and in many ways is still user-unfriendly. It can be expensive and national brands have an immediate advantage”.

“On the other hand, the opportunities were very attractive. Essentially, the Internet is a huge shop window with branded products working extremely well. But the big question was: what was the best way to display our products against competition from High Street big names”?

“Our first move was our own independent site, but eBay also seemed to be an obvious parallel solution. We did our research and this pretty much confirmed what we suspected – that nearly half of all Internet traffic lands on eBay (42.2% - Nielsen/Netratings) and that out of an online population of 25 million, the UK eBay site has around 15 million registered users (Nielsen/Netratings),” says Pearce.

“It was a ready-made customer base with millions of clients out there just waiting for us to open our store! But if it was so obvious and so apparently easy to employ why hadn’t everyone else got on the bandwagon? Why were some big brands not present? Why were many of those who seemed so solidly qualified to exploit the opportunities apparently not doing so? It was clearly quite possible to get it wrong – and examination of the various Internet issues showed why”.

“eBay trading offered the prospect of highly-cost effective operations, with aggressive marketing principles and strong links with shopping comparison sites. It provided excellent feedback mechanisms that helped build trust and indicated the promise of being able to build repeat business and retain customers far more effectively. It was community-based and provided selling advantages that were not merely based on price”.
Issues

“On the downside, however, there were issues that could easily become serious obstacles. For example, standard eBay listing tools are not easy to use, and automating and scaling the business up is not easy without expert help. Looking professional can be difficult. Users are increasingly sophisticated and demanding. A site has to not only look good but be good. At the same time too much eBay ‘look and feel’ can mask essential differentiation”.

“Then there are the issues of dealing with the threat of fraud, customer ordering and cancellation, credit control, performance information and feedback control and management … as well as a host of others. Underlying all this is the need to rise above the stigma perception of selling at a discount where everyone expects a bargain”.

“We also had to address the buyers’-at-home concerns, such as the awkwardness of the medium and its user-unfriendliness. Notwithstanding the fact that the Internet is a fantastic market to search for literally anything, it can be difficult for buyers to distinguish between
new and used articles as well as genuine and fake. There is heavy reliance on actual wording and nomenclature for search optimisation - for example: adidas/addidas – where the lesson for savvy sellers is to accept fuzzy alternative expressions.

“For Internet traders the real choice is between a standalone independent site or eBay where marketing costs are lower and generally proportionate to sales. This means dramatically reduced up-front marketing costs but no less a valid platform to build a brand or business that can mature into a dot.com presence in its own right”.

“For us, the eBay route was the way to go,” says Pearce. “We had a degree of internal Web trading knowledge but wanted to make sure we got our eBay presence right first time. We decided to partner with a professional external resource that could move us in the right direction, position us correctly, implement effective business processes that would address the identified concerns, and get us going”.
Guiding hand

“Key issues were automation and scaling up the business and training. While we wanted to be able to have full day-to-day operational control, we also wanted to have ongoing support and the knowledge that there was a sure hand to guide us through any uncharted waters”.

“Frooition offered a highly flexible solution – from initial consultancy to crystallise objectives, establish business processes, through eBay storefront design, automation, training – to live operation and ongoing support. There was also the option of a fully managed service but we preferred to handle the day-to-day operation and management ourselves. Nevertheless, it was reassuring to know the option existed – and could be exercised in the future if necessary to support changing circumstances”.

Frooition’s Self-Serve option is designed for clients with available, committed and technically adept resource who want to run their own eBay operation. Notwithstanding their operational independence, Frooition supports users via phone or email afterwards to mentor them through the important first few weeks of operation.

Under this service, Frooiton provides a comprehensive solution that involves providing business consultancy on how best to use eBay, training on the usage of the ‘Channeladvisor’ software automation functionality - leading to the creation of web design that can replicate a client’s own branding through Frooition’s CreativeBay design arm.
Control

The self serve solution is ideal for those eTraders offering lower margin products who wish to keep close control of costs and their overall business. Customers get help to set up as an eBay business, use of automation applications, a branded eBay shop, listing template and Channeladvisor storefront (linked ecommerce site), along with training and a full implementation programme. Users who opt for such a solution need to be reasonably software astute, eBay aware and possess, for example, Excel and basic HTML skills.

“Ongoing support is very important,” says Pearce. When your online business is growing so rapidly it is inevitable that you spend some time firefighting – and therefore vital that a guiding hand is just a phone call or email away. If you have the right products at the right price then the main challenge is finding, training and managing the right staff”.

“People with the right experience and attitude are often difficult to find and staff management is very time-intensive, so any help available to make these tasks easier makes a very significant contribution to the success of the business”.

“Other challenges that growth and success bring include managing feedback, storage and management of stock, ensuring on-time fulfilment, budgeting and planning in a rapidly shifting trading environment – and investment and funding”.

“An external resource provider – in our case, Frooition – provides an independent, experienced ally that both supports day-to-day operations and helps us keep an eye on future possibilities and opportunities coming up on the horizon. Because things move so fast in the online trading world, we believe it is essential to always have access to the kind of eMarketplace expertise, knowledge and technical skills that can easily make all the difference between success and failure”.

“Our overall growth plan is simple: to sell more. But to do this we need to make the right decisions – and get them right first time. Sure, all the usual excellent ideas: more listings, parallel sites, acquisitions, improved customer management, improved customer retention/repeat business, leveraging existing databases and upselling/cross selling”.

“In hindsight, those decisions that lead on to success may seem obvious and natural choices. They are not. They are the result of intelligence, technical ability, learning by mistakes, nerve, drive and faith. In all these areas there is always room for a wise friend”.

Visit the Hitchens eBay Shop: http://stores.ebay.co.uk/Hitchens-Hot-Deals
Visit the Hitchens Web Store: http://stores.channeladvisor.com/hitchenshotdeals