Stacks and Stacks’ Cathy McManus

“Lessons Learned” is an occasional series where we request experienced ecommerce merchants about their successes and errors. With this installment, we asked Cathy McManus, Marketing Director for Stacksandstacks.com, to talk about her ideas. Stacks and Stacks was formed in 1984 and ten years ago ceased its brick-and-mortar businesses to supply its 21,000 houseware and furniture products on the net. The business is based in Richmond, Calif., garners between $15 and $20 million in annual revenue and has over 50 employees. Here we provide McManus’ experiences and suggestions.

Third party firm resources

“We started using more third parties about three years back. We utilize Celebros for onsite research, Certona for product recommendations, and Google Analytics. We are quite happy with our third parties. Stacks and Stacks attempts to stay with the industry and, when possible, stay ahead of it, but we started out small by building our own capacities. But once we find better, stronger procedures of serving these programs, we outsource. At that point, Stacks only brings in applications that improve our own programs and are economical. To put it differently, we don’t just go out and buy apps when they reach the marketplace. We wait until we want our sales volumes can handle them.”

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Shopping cart software

“Ours is proprietary, but I think off the shelf is useful for novices to the internet.”

Hosting

“We use Verio. If a firm is big enough, they must have a dedicated host to themselves. At one point when we were talking a server we’d been having a lot of problems because it was getting overloaded. With one of these companies, you would like a dedicated manager. You want to cover it. If you don’t, you’re just another cog in their wheel, and you will need to wait for somebody in their customer service department.”

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Employees

“There is no magic number of employees. It is dependent on the size of your organization, and it depends on what you’re doing. We use a good deal of freelance copywriters working from their homes. That was fabulous. Nearly all our copywriters are part-time, but we have got one fulltime individual who also writes the blog. A great deal of them are college students who only wanted part time occupation. I would suggest having a look at universities for part-time employees. They are usually bright, creative and excited.”

Pay-per-click advertising

“We’ve never been happy with anyone around now. We don’t have staffing to do so and don’t want to pay a full-time employee. The ROI just isn’t there. It’s not really worth it to the clicks. Companies we ignore are those which say they can increase sales by 30 to 40 percent and charge by clicks based on traffic we are already doing. We are in need of conversion, so cost per acquisition is pretty much how we deal.”

HT18ML

“We are now employing a company, WPromote, who is helping us optimize. This is not a perfect science. We have just been working together for a month or two. Up to now we enjoy what they’re doing. We’re going off to other avenues with product blogs. We made a whole website conversion a few months ago and our customers began dropping off. That’s the reason we hired this enterprise. Up to now the changes they’ve made have worked out.”

Cost control

“Software companies are supplying complex, expensive programs that in many cases are much too complicated for many small to midsize sites. Some of these solutions need more full time employees to install and manage than companies have on workers. As there’s so much competition for business, ecommerce websites are purchasing in these programs so as to be left behind. It appears that these sites have forgotten about the economics, the ROI concept of how these apps will insure themselves.”

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Accounting software

“We use Mas 500, from Sage Software.”

Order management applications

“Ours is proprietary and will eventually tie into accounting.”

Shipping and order fulfillment

“Seventy-five percent of our products are drop shipped by manufacturers and 25 percent are from our warehouse.”

Analytics applications

“Unless a company actually knows how to use all of the analytics that may be reaped from the Omnitures of the planet, basic Google Analytics is fine.”

Credit card payments

“We take everything. If you will start an ecommerce company, you must provide as many forms of payment as possible. We have numerous ways for people to buy. We use all credit cards, Google Checkout,’Bill Me Later,’ PayPal and a lot more. We started using eBillme two weeks before, and it’s been good.”

Social networking

“We’re just now getting our feet wet. We signed up a month or 2 back on Facebook. Besides that, not much.”

Websites

“We’re expanding into other avenues with our product blogs. It’s like public relations–you build it, then you have got to wait a while to observe the results. We probably won’t know the effects for a month or two. Our site is Cluttercontrolfreak.com, and we have product websites for SEO. Our website is doing good, socially. Blogging is definitely one of the very best method to improve SEO.”

Customer service

“We use in-house customer care and a company to look after orders after hours. We also have live chat with LIVECHAT. These online customer care programs are fine but not as strong as using an 800 number for customer service. I feel that is because people do not want to sit there and type in questions and await the customer care representative. It is too slow.”

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