It is the American Dream: own your own business, and make loads of money. Well, that’s the dream part, then reality sets in: business licenses, put-up money, taxes, etc. In the case study of the Cliptomania Web Store, in 1999, John and Candy Santo discovered a marketing niche that they could tap into; selling clip-on earrings, over the internet, throughout the United States, Canada, Ireland, Australia, and New Zealand (Brown, DeHayes, Hoffer, Martin, & Perkins, 2012). This type of marketing is called Business to Commerce or (B2C) e-commerce, which is way of purchasing, or selling goods and services over the internet. As with any new business venture, it started out of the home with a low-level of overhead.
In 1999, John and Christy Santo started an online web store, Cliptomania.com, out of their home, using $10,000 of their savings as start-up capital. At the time, selling only clip-on earrings was a market that not many had tapped into, since most people who wear earrings have pierced ears. Cliptomania.com sells nothing but clip-on earrings, and offered its customers hundreds of different styles. With research done by John Santo, he decided to contract with the vendor Yahoo! Store in 1999. The Yahoo! Store uses a ratings system for customers to rate their service, and by 2003, due to their rating by customers, they became one of the top 5 selling jewelry stores on Yahoo!, in gross sales because of having a quality product and excellent customer service.
One of the challenges the Santo’s faced was the technology aspect of the business, or the how to start up the web store. No one in the family was familiar with web design and they did not have the money to pay a service provider for the site design. By doing their own research They found that by hiring a vendor to host their website, the computer resources, as well as the software and templates, for a price, would allow a company to tailor the web pages to suit their needs.
The second challenge was management of their web store. In 2006, for whatever reason, customers started having problems with the Yahoo! Store website. Customers were having trouble placing orders, and the Santo’s were being charged for some transactions that weren’t valid. So, when they tried to fix the issue, and could not, they decided to change web servers, and went from a .com to a .net website. They ran both sites, but it confused the search engines. The reason for the confusion, could have been due to the issue of the difference between domain names extensions. The difference of the domain name extensions could be defined as: “.COM is for commercial websites, and .NET was hosting networks. (Gil, n.d.) The Santo’s tried to work out the bugs, but eventually had to move back to a .com domain address.
The third strategic challenge was marketing on the web. Marketing on the web is primarily getting customers to visit your web store. The best way to be found was by being picked up by one of the major search engines, Yahoo! Search, Google, or Microsoft’s Bing. At the time Cliptomania™ was using the search engines on the internet were still listing sites by significance or how close the words being used matched in the search box. If you are not listed on the first page of the search results, than you probably would not be found by customers. So, it was important for them to learn about how search engines determine their rankings, so a company can be found the first time around. (Martin, 2010)
Using the SWOT Analysis to analyze the future of John and Candy Santo’s web store, a strength is their offering of a quality product and excellent customer service. They will have a loyalty base of customers who appreciate dealing with a company that treats them well, and can obtain new business from word-of-mouth recommendations. A weakness is the ever-changing technology and the economy. As long as the Santo’s stay current with new developments in web retailing, and adjust to a downturn in the economy, they will stay afloat. An opportunity for the web store is to ever improve on the relevance rankings on the web search engines. Trying techniques, such as having other companies advertise on their site, and maybe advertise on social media blogs and sites, can help boost exposure of the web store. A threat can be competition from others selling on other sites such as EBay, that sell their personal items or store items, and Etsy which sells homemade items; keeping an eye on the competition and looking at the trends of how customers are purchasing can help them stay in business for the long-haul.
The Cliptomania web store, all in all, is in good shape to stay successful. When John and Candy Santo began their business, it was out of their home, with a low startup cost, and hardly any competition in the clip-on earring market. They have had their trials and tribulations with the boom and bust of the dot-com industry, how to learn about their market, and their competitors, and how retailing on the internet is done. Although nothing is certain in today’s economy, the Santo’s will be able to weather the storm by still offering top-notch products, and one of a kind customer service. After all, customers keep going back to whom they receive a good deal and good service.
Courtney from Study Moose
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