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Shaun Ryan : [00:01] Hi, I’m Shaun Ryan, from SLI Systems, and today I’m talking to Bill Cronin, from Vermont Teddy Bear. Now, Bill, what’s the first thing you ever bought online?

Bill Cronin : [00:09] I can’t remember that. I think it was most likely something from Amazon.com. I would imagine that that’s probably a very similar story to someone else. My guess is that it was a book.

Shaun : [00:24] How about the most recent thing? Can you remember the most recent thing?

Bill : [00:27] I think it was probably a motorcycle helmet.

Shaun : [00:31] Cool. Just tell me a little bit about the company and what it does and what its history is.

Bill : [00:35] Sure. A gentleman named John Sortino, back in the early ’80s‑‑I think it was about 1983‑‑started with a little cart on the Church Street Marketplace. He sold teddy bears out of his little cart, and I think it took him a whole year to sell his first 200 teddy bears. Today, we’re a company that consists of five brands. We’re primarily in the gift industry.

[00:58] Our five brands are, obviously, the Vermont Teddy Bear Company. There’s the PajamaGram Company, where we send just general Pajamas, but we differentiate ourselves by the keepsake gift packaging that it comes in. We have Calyx Flowers, where we send high‑end bouquets right from the grower to the consumer.

[01:20] We also have TastyGram, which sells regional specialty foods; and again, that’s direct‑to‑consumer. And the Gift Bag Boutique, which is probably our smallest brand at this point, and we sell themed gift bags that people can select accessories. "The gift is in the bag" is the catchphrase for that. So you fill the bag with accessories and send it to someone as a gift.

Shaun : [01:40] Excellent. So it’s grown a little bit from that first cart.

Bill : [01:44] Oh yeah. Oh yeah. We’re on 57 acres in Shelburne, Vermont, now. It’s a beautiful location, where we’re right next to a dairy farm. We can have a little view of the mountains off in the distance.

Shaun : [01:56] Oh, that sounds wonderful. I love hearing stories about that, of entrepreneurs who started off small and just keep growing and keep growing. And yet, you’re obviously still growing. Do you know, are there plans to acquire more brands?

Bill : [02:06] We are always looking for opportunities to grow. In some cases, we acquire new brands, and we tend to do that when we want to get into spaces, like with the Calyx Flowers; that was an acquisition.

[02:19] The flower space was something that we weren’t as familiar with as something like PajamaGram, which we started. It was an organic growth initiative. We grew that in‑house, because we had experience working with the vendors who created the bear clothing, and so we just hired some Pajama designers and worked with the same vendors that were creating our bear clothing to create the Pajamas. So that’s a largely organically grown organization.

Shaun : [02:47] Fantastic. And so, is it just online you sell, or do you have stores as well?

Bill : [02:53] It’s primarily online. We do have stores. There’s a store here at our Shelburne factory. We also have a small outlet in Waterbury, Vermont, which is right outside of Stowe.

Shaun : [03:03] Right. OK. But it’s primarily an online store, for all your brands.

Bill : [03:06] Primarily an online store. It’s more of a tourist destination, really, our store here. We do sell bears, but we also give factory tours. I believe it’s the second most popular‑‑and you can’t quote me on that because I’m not sure if that’s still the case‑‑but it’s the second most popular tourist destination in the state, behind Ben and Jerry’s.

Shaun : [03:23] What sort of sales numbers or growth numbers can you share with us?

Bill : [03:26] In Internet retail last year, I believe we recorded about 60 million across all our brands online. This year, we’ve seen a little bit of growth, year over year.

Shaun : [03:34] Excellent. So, how do you attract people to your site? How do you do your marketing?

Bill : [03:39] Well, traditionally, it’s been a lot of radio for Vermont Teddy Bear. We’ve done very well with the likes of Howard Stern, who we have a lot of call‑ins with every year around Valentine’s day. We also do TV advertising. We do have organic…

[03:54] We promote SEO. We promote SEM. So we do have a large page search program going. We’ve gotten, this year, recently, into comparison shopping engines. We use a feed aggregator for that so we can get, with a minimal amount of work, into many of the different comparison shopping engines. We have our own in‑house email list. And we do a little bit of re‑marketing to visitors through banner ads. So, typically, our banner ads are focused on people who have already visited our site.

Shaun : [04:27] So there’s a full suite of marketing that you do. I’ve heard quite a few people saying that they’ve seen or heard your ads, especially leading up to Valentine’s Day. It sounds like that was a huge day for you.

Bill : [04:37] Valentine’s Day is, far and away, our biggest holiday of the year, for Vermont Teddy Bear. For PajamaGram, we tend to do almost as well at Valentine’s Day as a holiday. For Calyx Flowers, Mother’s Day is our biggest holiday. But in terms of the most packages shipped in a day, typically, year over year, every year we do the most packages in a day, breaking our previous record, on the last day of two‑day shipping before Valentine’s Day‑‑so, the last day that people can get a reduced‑price shipping.

Shaun : [05:08] So, for your search marketing campaigns, do you do that in‑house, or do you have someone that you contract to help you with that?

Bill : [05:16] We’ve gone back and forth on that. We started off in‑house. Then we were using a tool, or we had just acquired a tool so that we could better manage it in‑house. The gentleman who was going to be running that tool left the company, and so we had an agency who provided us the tool run our campaign for a little while.

[05:36] We’ve had our campaigns run for a little while with an offshore agency. Right now, that’s our current position, is that it’s primarily outsourced. But we have our hands on the knobs, so to speak, of where our dollars go and how we want to really push our campaign. Because our business is so seasonal and so gift‑related, different specific keywords that we have a lot of experience with, perform very well leading up to the holidays.

Shaun : [06:06] Those years of experience really help when the holiday comes around again.

Bill : [06:09] Exactly. We are using some of the information provided by the SLI search. We do send that information off to our search marketing partners.

Shaun : [06:18] Yeah. Oh, that’s great. I think the terms that people use on site search are obviously very related to the terms people use when they’re searching the web for the same content.

Bill : [06:27] Exactly. So we do provide a weekly report to our search marketing company on what people are searching on on‑site.

Shaun : [06:36] And how’s the comparison shopping engine experiment been working out?

Bill : [06:41] We don’t do a ton of business there, but it does get us some rankings in Google. So, when you do a search for "teddy bears" or "Vermont Teddy Bear," typically you’ll see us near the top, through our commercial, consumer site, and then you’ll see some of our affiliates. Then you’ll see some other people who are trying to kind of squeak in there and make a little bit of money off our name by getting into organic search results or paid search.

[07:08] But if we’re in there with comparison shopping engines, we tend to bump a few of those people down a little lower in the rankings. So we do get some click‑throughs on that. The program, it’s not going to have a new wing built on our factory, certainly, but it is definitely self‑supporting and does turn a little profit for us.

Shaun : [07:24] Now, let’s just talk about some of the technologies. What platform are you using to run your store on?

Bill : [07:29] Well, currently, we have a mix, and we’re trying to do a little bit of consolidation. Vermont Teddy Bear is an interesting story. We started out as a Yahoo store, way back in, I believe, 1998. To this day, we still have that Yahoo store. Right now, it’s our primary store.

[07:45] We have experimented a little bit in the past. We went to a platform called ePages, which was formerly Intershop. We were on that for a short period of time, I think, in the early 2000s. Then we did come back to Yahoo Store for our peaks. We tried Demandware for a short period of time. Demandware, they have a nice product. But internally, we were going towards an ASP.NET direction for our IT staff, and Demandware is more of a Java application.

[08:16] So it came time to re‑platform the Calyx shopping site, and that was on ePages as well, the Calyx Flower site. So we decided to go with Microsoft Commerce Server 2007 on that, just to kind of unify our internal IT development with our web development. So, right now, we’re no longer using Demandware. We’re primarily on Yahoo Store for Vermont Teddy Bear. We’re on Yahoo Store for PajamaGram. We’re on Commerce Server 2007 for Calyx Flowers. And we’re on ePages, still, for TastyGram and Gift Bag Boutique.

[08:56] Now, we do a lot with Yahoo Store. We’ve extended that platform. We really managed to do a lot of good things with it. We do a little bit of AJAX‑like things to provide real‑time availability of our products, so people can’t order things that our out of stock. We’ve done that for both PajamaGram and Vermont Teddy Bear.

Shaun : [09:13] Wow. So you guys have quite a bit of experience across a number of platforms. And it’s interesting that a store of your size and the volumes of traffic that you get is using the Yahoo Stores platform, because often it’s associated with the smaller stores. But obviously, it scales well.

Bill : [09:27] It scales very well. That’s one of the main reasons that we’ve been reluctant to switch off it, especially for our more peak‑y sites, like Vermont Teddy Bear and PajamaGram. Especially Vermont Teddy Bear: the volume of traffic in the week leading up to Valentine’s Day, that’s a good quarter of our traffic for the entire year.

Shaun : [09:50] What are your biggest headaches at the moment? What are your problems? What are you working on?

Bill : [09:53] We’re working on enhancing the Calyx Flowers site. Today, I was working on a little bit of trying to use JavaScript to enhance the Yahoo shopping cart to provide new things. Some of the things we’re expanding into a little bit more is a little bit more of customization of our products. So, for Vermont Teddy Bear, we’re getting into customized eye color, fur color, and paw pad color combinations, as well as being able to…

[10:21] One of our big selling points is that you can often get embroidery or personalization of some sort on the outfits that the bears wear. Well, now you’re going to be able to personalize the paw pads as well. Really, I’ve been looking into, recently, trying to figure out the best way to deliver that, in terms of customer experience online, as well as the operational issues online and operational issues right down until it gets into our order management system.

Shaun : [10:50] Yeah. It can sound like quite a simple idea: "Let’s make it so they can choose their eyes." But when you get down to the nuts and bolts of what you need to do in order to make that happen and make it seamless, there’s a lot involved, isn’t there?

Bill : [11:01] There certainly is. The less interaction we can have with our customer service agents, the more profitable our organization is. So, the better we can present that online and collect everything we need to get that order seamlessly into our order management system, the better off we are.

Shaun : [11:19] So, how many people do you have on your team?

Bill : [11:21] Really, it’s a fairly small team, considering the number of sites we have. There’s myself, and I’m a fairly hands‑on manager; like I said, I was writing some JavaScript code today. I have two people doing primarily product management, managing the product assortment on the websites.

[11:38] There are two designers/developers. They do most of the design work plus a little bit of the light HTML. I have another, more of the heavy‑duty HTML/template/actual programmer. He does a little bit of everything. He’s our good, all‑around guy to have. Then there’s another gentleman who does the search engine optimization and reporting, and he’s very handy with HTML as well.

Shaun : [12:06] I imagine that the lessons you learn on one site, it’s relatively easy to then go and apply that to the other sites, if it’s applicable.

Bill : [12:13] Absolutely, especially in terms of Vermont Teddy Bear and PajamaGram, where they share a platform. With our great platform diversity, it’s sort of challenging because you can learn a lesson on one site that the implementation strategy isn’t going to apply to another site. Some of that leads to solutions where you take it outside the platform. And SLI is an example of that, where we were able to implement a solution across both Yahoo Stores and Commerce Server stores. It’s an effective solution to our on‑site search issues.

Shaun : [12:51] So, how have you found the whole experience working with SLI?

Bill : [12:54] It’s been very seamless. The engineers are excellent. Response times are excellent. Anything I’ve asked to have implemented, it’s been great. Some of the things, custom things that aren’t out of the box for you guys‑‑which, really, none of the things are really out of the box for you guys.

[13:06] But in terms of your Yahoo Store type integration‑‑which you guys have a number of, I understand‑‑we’ve added some additional feeds to the data feed that comes out of Yahoo Store, so that we can do things like on our PajamaGram store, we actually, instead of using all of the Learning Search, we incorporate Learning Search and sales from the site into our results rankings. So we’ve been able to integrate those two numbers to really be able to push our bestsellers, as well as items that people may be looking at but not necessarily buying.

Shaun : [13:44] Right. Yeah, that’s really cool. I’m pleased that that’s gone well for you.

Bill : [13:48] Yes. It’s been great. And for Calyx, when we did the re‑platforming over the last summer, it was fantastic not to have to worry about search. All I really had to worry about was making sure that all the data we needed was in the export. And Commerce Server provides an XML export that was fairly trivial for me to make available to you guys.

[14:10] I just didn’t have to worry about it, and that was a great relief to me. I have a fairly small team, and to be working on a re‑platforming project while we’re still trying to run the day to day, nuts and bolts of the business ‑‑ to have a big task like onsite search just taken right off my plate was a real godsend.

Shaun : [14:30] I’m pleased to hear that. So what are your plans for the coming year? What are the changes we’re going to see? What are you going to be working on in the longer term for this year?

Bill : [14:37] Well, certainly, we’re looking at adding the enhanced personalization aspects to the Vermont Teddy Bear site. We’re probably going to do a redesign of that in terms of how it looks; we may try another experiment. We’re certainly going to move our ePages platform sites over to Commerce Server. I think we’re going to try to really enhance the Yahoo stores, if not re‑platform them. Just enhance them with a little more Ajax‑type functionality, so that it’s not only easier for us to manage the stores, but also there is enhanced user experience.

Shaun : [15:17] I’m definitely seeing that across the e‑commerce sites that we’re looking at. You’re starting to see more and more Ajax coming into the sites just to enhance that user experience. You obviously have to be careful with that to make sure that Ajax doesn’t completely change the user interface, but just enhances it, makes it something a little bit faster, a little bit more information on the page.

Bill : [15:39] We look at Ajax and sometimes we want to put a little less information on the page. A great example of that is for PajamaGram. We’ll offer several different options for a product and one of those options could be, for example, if someone wants personalization, they have the option to choose either a name or a monogram. Right now with the Yahoo store implementation, we pretty much have to, in the basic Yahoo store, give them a drop‑down as to whether or not they want the name or a monogram, and then we provide them with a name text input box and a monogram text input box.

[16:16] In that case, we’d like Ajax to present less information. We’d like to default the name or monogram option to a pre‑select, and then present them with only the name or only the monogram based on the selection. So not only does Ajax allow you to add more things to the page, but it allows you to really pinpoint the information you need to make it a more streamlined, user experience for the customer.

Shaun : [16:41] Yeah, and in that case, less is going to make it easier for the customer to fill in the correct information, right?

Bill : [16:46] Exactly.

Shaun : [16:47] Are there any other stories or anecdotes that you think other people that are running e‑commerce stores would like to hear that you’ve had?

Bill : [16:55] I think having good analytics is important. Right now, we’re running Google Analytics, but we’re really looking to expand that out into an Omniture or CoreMetrics.

Shaun : [17:05] And what are you looking to do with analytics? You’re looking to do testing so you can improve the conversion through your sites?

Bill : [17:11] Everybody wants improved conversion. We have a great conversion rate because we do send out catalogues, so we get a lot of people using the site as an order form. But certainly, everybody wants to get that conversion rate up a little bit. We just like to use it to not only get the conversion rate up, but to trim the fat off the sites a little bit, find out where people are clicking, get the hotspots and be able to more closely link onsite behavior with things like our email list; to really be able to target our emails to people who, let’s say, have gotten to the shopping cart and abandoned at that point.

[17:53] Some of these higher‑end analytics packages integrate with our email provider and can allow us to do things like send a shipping offer. Instead of everyone on our email list, we can send that free shipping offer only to people that got to the shopping cart and bailed out. We can even get so far as to only send to people who only got to the shipping page and bailed out, and so it really allows us to do more targeted marketing of that nature.

[18:19] It also would allow us to do things like, just more personalized content, like getting people on the site. Let’s say somebody goes to the site, shops primarily in the ‘New Baby’ gallery and then leaves. When they come back to the site, being able to show them content on the home page that says, ‘Check out our New Baby gallery. There’s some new products in there’ ‑ those kinds of onsite personalization tactics to really drive conversion.

Shaun : [18:48] Yeah, there are some huge opportunities there. I think I’ve seen people using that with their email as well, sending out personalized emails to those people that abandoned, that includes content that’s related to what they were looking at on your site. Those personalized experiences can significantly increase the conversion rate.

[19:08] Well, thanks very much, Bill. Is there anything else that you would like to hear in these podcasts if you were listening to other people talking about their experiences?

Bill : [19:16] I think I would like to hear more about, do we have some ideas about how we would like to use your product that we haven’t implemented yet, maybe if other people are doing things like that. For example, one of the ideas we’ve had is to not necessarily drive people to a normal SLI search results page coming from a pay‑per‑click page.

[19:41] So if somebody comes through from a pay‑per‑click and they search for one of the long‑tail terms that we don’t necessarily have a page built for ‑ but being able to build a page on the fly based on SLI search results. So, possibly getting back an XML feed or a web service that would provide us the top dozen or so search results from that search, that kind of lets us build a page on the fly tailored to that pay‑per‑click.

Shaun : [20:08] We’ve seen our customers use a couple of techniques for that. One is to just send them straight to the search results page for whatever the search term was that was being purchased on the Google AdWords account, or alternatively, extracting the referrer and showing the search results for the actual term that was searched on Google. Often, if you’re using a broad match on Google that can be different from the keyword you bought.

Bill : [20:34] Exactly.

Shaun : [20:36] So then you’re getting a page that’s tailored to the exact term that people were searching for. We do see a lot of our customers just pointing their page search campaigns at those search results pages because they convert high. Thank you very much, Bill. I really appreciate you taking the time to talk to us.

Bill : [20:52] I hope so too. I appreciate you taking the time out to talk to us.

Shaun : [20:56] I’m Shaun Ryan from the Ecommerce Podcast. To find other podcasts, go to EcommercePodcast.com . If you have questions or comments, or things you would like to hear on this podcast, please send them to us at questions@ecommercepodcast.com . Thank you.