Kiefer sold his first baby product online in 1996, a time when having an e-mail address was about as common as owning a jetliner. As the new project coordinator of a company called iVillage, Kiefer saw the traffic of pregnant women visiting the site continually increasing due to its parent-focused publications. He approached his CEO with the idea of developing a separate site dedicated solely to baby products.
“Myself, Elaine Ruben, and Tori Crimmins evaluated the market and found a start-up in La Hoya to buy,” said Kiefer, CEO and co-founder of BabyAge.com. At the time, the California-based Internet site was doing roughly $10,000 a month in retail and sales. Six months after Kiefer and his team acquired the site and rebranded it to iBaby, that number increased to $500,000.
Wanting to transition back to the East Coast, in late 1998, Kiefer set up a head office and a 50,000-square-foot warehouse in Pennsylvania and founded BabyAge.com. Today, the team’s original goal remains in place—to make it easy for parents- and grandparents-to-be to buy the baby items they want without experiencing any hassle.
How it’s done
Core to BabyAge.com’s business philosophy is keeping merchandise stocked and ready to be shipped at all times. “Even though more often than not they’re not going to use the product immediately, our customers want to know that once they’ve ordered it, it’s going to get shipped,” Kiefer said.
To keep up on the inventory, which consists of more than 20,000 SKUs that range in size from something as small as a nipple to something as large as a crib, the company built an operational and technological infrastructure that focused on efficiency. The merchandising and forecasting system starts with new product additions and goes through the receiving end of a shipment. It is also fully integrated with the company’s Web site, marketing tools, CRM, and analytics.
Kiefer said the system enables BabyAge.com to continually grow its business without losing sight of the smaller details involved in the process. The company initally looked to outside consultants for advice, but its inhouse management team was responsible for developing the final product.
“We didn’t give ourselves enough credit for the quality of the applications we’ve developed in the past,” said Kiefer. “What is core to our business is our ability to completely integrate the company on a technological platform that’s scalable.”
Pulling it together
With a core customer base that includes parents and grandparents of all ages, keeping BabyAge.com easy to navigate is also at the top of mind for Kiefer and his team. Part of the company’s ability to stay on top of what’s new and useful in the world of e-commerce comes from simply talking with its customers.
“It used to be that we’d do random calls to customers, finding out about their experiences, what our site was missing, and what it had that they liked,” said Kiefer. “It’s increasingly become a part of all of our employees’ day-to-day behaviors.”
BabyAge.com implemented a parametric search on its site, which narrows down and streamlines consumers’ searches. The company also continually reviews its top search items to figure out if there are common misspellings and help direct consumers to what they’re looking for.
Shopping cart abandonment has become another major challenge for e-commerce gurus. One cause is the complexity of shipping models on some sites, which also means complex billing options. To combat this issue, BabyAge.com offers flat-rate shipping.
“Outbound freight is our single-largest expense,” said Kiefer. “By offering a flat rate shipping program and making sure that our operation can be as absolutely efficient as possible by doing things like banding multiple boxes together to get one label on it, we’ve mitigated our shopping cart abandonment.”
BabyAge.com also does an outbound e-mail campaign based on consumers who didn’t successfully complete their shopping cart. “The shopping cart abandonment e-mail conversion rate is about 20%,” said Kiefer. “We’re still digging deeper into those areas to find out why people aren’t completing their orders.”
Private makes perfect
BabyAge.com ventured into private label goods years ago due to dissatisfaction with the way many of its crib manufacturers packaged their products. The shipment damage rate had reached 15%, and the number of manufacturers the company wouldn’t work with outnumbered the number it would.
“We went back to the manufacturers and told them we’d pay extra for better packaging on the goods they shipped to us,” said Kiefer. “They came back and said they wouldn’t do that.”
The same problem occurred when BabyAge.com asked for amendments to product colors and design. Because the manufacturers weren’t responsive to feedback from the company’s customers, BabyAge.com developed its own product lines and, according to Kiefer, hit a product homerun.
BabyAge.com has now moved beyond baby furniture in its private label line, offering products like pregnancy pillows, which contour to the specific needs of pregnant moms needing more support between their knees or under their stomachs.
“We went back to the manufacturer and asked for better colors and fabrics; they said no,” said Kiefer.
“Then they wanted us to sign a price fix brand paper, and we wouldn’t do it,” he continued. “So, we took our years of experience in selling these items, surveyed hundreds of customers who used the products, and designed our own products.”
As Kiefer looks ahead, he sees online shoppers becoming less loyal to specific brands and more in tune with price and quality. As such, he sees great things ahead for BabyAge.com. “We need to continue to provide a high level of service, be competitive, and offer differentiated, quality products while also expanding what we’ve started as leaders in technology,” he said.
“The future will be less about going to BabyAge.com and more about getting the products to customers in a way they want,” Kiefer concluded.