Case Study: Web Site Becomes Gateway to Customer Satisfaction
by David H. Bluestein II
Mile High Comics, "America's Largest Comic Dealer", is a traditional mail order company for comics and related merchandise. While new comic subscriptions are a part of their business, the majority of the sales are comprised of back issues of comics from previous years--collectibles for which inventory replenishment fluctuates in terms of availability and price.
In an effort to increase customer satisfaction and sales, Mile High Comics turned to Web development firm ii, inc. to plan and develop its Web site to address these issues.
Challenge
A traditional mail order company with a handful of storefronts, Mile High Comics reached its customers through an annual print catalog and ads periodically placed in comic books. The problem was that the annual catalog took months to layout, was costly to print and mail, and was rapidly outdated in terms of inventory. Since Mile High Comics is in the collectibles business, inventory is not easily replenished. If an item sells, it may take days, weeks or months to replace it, or if it is in mint condition, it may be years until another one is found.
Because sales were heaviest after a new catalog was released, scarce items sold out quickly and as a result experienced a high out of stock rate shortly after a catalog's release. Similarly, because ads were on a four week rotation, by the end of the second week advertised items experienced a significant out of stock rate. Out of stock items caused customer frustration, and caused Mile High Comics to issue many credit memos and refunds. In addition, orders for out of stock items resulted in lost sales, since customers could have chosen alternate items if they knew items from their initial selection were out of stock.
Analysis
While an infrastructure was in place for mail order at the time ii, inc. was hired, there was only a very small Web site which lacked any inventory and ordering information. The annual catalog was shipped to existing customers, and to potential customers who requested it, but there were no easy channels to expand its distribution. Because each issue of the catalog quickly became outdated as collectibles were sold, and there was no readily available supplier to replenish out of stock items as in a traditional retail environment, the challenge was to provide a current inventory for customers to use when selecting items for purchase to prevent orders of out of stock items.
An additional challenge for Mile High Comics was how to create a better ordering methodology than either phone or mail orders, especially for their large overseas customer population for whom mail ordering was a slow process. Those orders had required manual entry into the mainframe, with all the issues inherent in re-entering information. Also, this method required a high level of staff involvement, and hence significant staff costs.
Inventory information was stored in the mainframe computer at their location, but the mainframe was not connected to the Internet, and was not easily converted into a webserver. In addition, there were security concerns over using it as a webserver.
The decision was made to enhance the Web site from a small static site to a robust, database-driven eCommerce Web site.
Goals
The key goals for the Web site were:
- Add the ability to place orders via the Web site
- Provide accurate inventory and stock status to prevent orders for out of stock items
- Provide a bridge between the Web site and the mainframe
- Notify customers when out of stock items are back in stock
The Web site would have an eCommerce system with inventory and ordering capabilities, which could be used in conjunction with the mainframe by using file transfer to update inventory on the Web site, and import orders from the Web site into the mainframe for processing and shipment.
Once the first three goals were set, ii, inc. proposed to Mile High Comics that the Web site would offer a service that was impossible before: that customers could be notified when an out of stock item came back in stock. As a result this was added as the fourth goal.
Solution
To better serve their customers, the Mile High Comics iStore was developed. As an expansion of the existing Web site, it was integrated with the existing site style. An extensive search function by publisher and title was incorporated into a shopping cart system to permit customers to easily find and order items. Out of stock items could be seen if desired, but not ordered. However, customers can now place an out of stock item on their wish list and become notified via an email when it is in stock again.
An administrative import program was created which uploads an inventory file from the mainframe to update inventory levels, update prices for sale items, and add new items based on additions to the product offerings.
Additional features provide statistics on the success of the iStore, which keeps track of sales so that a realtime view of daily sales is available with details on number of orders, items sold, and daily sales figures.
Results
The iStore is a huge success. In terms of metrics:
- 350,000 average page views per day
- 200+ orders per day on average
- 75% annual growth in sales for three years running
- Dramatic Reduction in out of stock requests
- Elimination of printing and mailing costs for 20,000 copies of the 128-page annual catalog
The iStore information is updated daily from the mainframe, and tracks web sales for inventory purposes. Since orders are saved in a format readable by the mainframe, staff no longer manually enter orders as they do for mail and phone orders. This eliminates data entry errors and allows staff to focus on more important tasks.
The site reaches a wider audience than the previous catalog mailings, which only went to existing customers. In addition, ordering was simplified, which has resulted in increased sales. Since Web site orders are received and imported into the mainframe at least once a day, orders are received much faster than via mail order.
As a result of the success of the iStore, additional features for the Web site were planned. Funded by revenues from the iStore, the Web site has been expanded to include many additional features, some of which include:
- Bibliographic details on products, including search by staff credit and major characters
- Special lists of items, such as items that are new in stock today/within the last week and separation into genres such as movie posters, Archie comics, etc.
- Over 50 mailing lists that customers can join to find out information on topics specific to their interests
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