Behind the Scenes at Eden In Love's Online Launch
How a local boutique opened its online store while competing in a national contest
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Photo: Courtesy Tanna Dang
Sunday, 10:30 a.m.: Ruthie Diaz is inside with her boyfriend, David Oi, and their 4-year-old, who is happy with a cupcake as Ruthie tucks half a dozen blouses and dresses under her arm to try on – when she can get through the crowd to a dressing room.
Outside, instead of taking his family to the movies, contractor Ozzy Naweli pulls over so his wife, Shontaz, can join the line of shoppers while he waits with 3-year-old Shaily, asleep in her stroller. They’ll catch the movie later, he says.
Just inside the door, 250 cupcakes crowd a table next to the computer where customers can vote in the national video contest. Eden in Love’s video is now among the final five, with a good shot at the top prize of $25,000. If they win, Bryson says, half of the money will go to the videographer and the other half to kiva.org, an online worldwide microfinance organization. Each month, the company already donates about $2,000 to local causes through its “Divas Doing Good” program.
Upstairs, glitches and unforeseen issues prevent the online site from going fully live. Bryson works feverishly to fix the problems. At the last minute they realize they’d forgotten to establish a mailing policy for out-of-country sales and international shipping rates can be double or more than the in-country rates. And they hadn’t yet figured out a return policy: A refund? A credit? Would they charge for mailing things back? And how long would the return policy be? Two weeks as it is now or longer to accommodate the mailing time?
It all means sitting down with key staff and talking it through. At the same time, Bryson discovers the sales layout looks different – and unattractive – on some Apple computers’ online browsers. With these last-minute issues, they decide Sunday to do a “soft” launch of the edeninlove.com sales site – merely announcing it at the birthday party downstairs, rather than with a full-fledged announcement. That announcement is postponed for 24 hour.
Bryson’s IT skills are crucial right now, but even before he began work on the sales website, Eden in Love was taking more and more of his time. So, in May 2011, he had left his job as an electronics technician at Hickam Air Force Base to work full-time for the family business.
Photo: Courtesy Tanna Dang
Monday, April 23, 4:15 p.m.: After the glitches and issues are resolved, the site goes live at 4:15, heralded by a Facebook announcement and an email blast to Eden in Love’s customers. But, even before that, lots of local and mainland customers have been checking out the online shop since its soft launch.
“We had about 80 to 100 views and click-throughs on each page in the last 24 hours before we announced anything,” says Tanna.
Monday, 5:15 p.m.: In the first hour of official online sales, page views soar to more than 600.
“You’ve made this Maui girl very happy,” enthuses one fan on Facebook.
“Whoa!” says Tanna. “Here we go.”
Monday 6 p.m.: On the counter next to Tanna are seven boxes ready for shipping. Seven online orders in the first 24 hours. All on Oahu.
“Definitely manageable,” says Tanna, masking any disappointment she may be feeling.
If they grow to 10 or 20 a day, it’s still manageable. If they hit 200 a week, it might mean hiring a 20th staff member.
Tuesday, May 1, 9:19 a.m.: The National Retail Federation announces that Eden in Love’s video has been picked as one of three finalists for its nationwide “This Is Retail” contest.
“Tanna’s story is one of philanthropy and opportunity,” the federation says in a news release. “Highlighting the charitable acts she and her associates take on throughout the year, Tanna’s video centers on how ‘retail creates opportunities to do good and make a difference.’ ”
Tanna, Bryson, Tessa and Michelle will all fly to Washington, D.C. – expenses paid by the NRF – for the awards ceremony May 16 to hear the final results.
Wednesday, May 2, 10:30 a.m.: Ten days into cyber sales, the online site and follow-through is running smoothly. The site is getting thousands of hits daily, and sales are climbing. Tanna has handed the work of pulling, wrapping and shipping to Bryson and another staffer, so she can focus on daily Facebook promotions and customer service.
“The postman is coming daily to pickup,” she says. “But we’re still figuring out some systems. Sometimes people see something online and want to come into the store and pick it up, but the inventory is completely separate. So we’re trying to figure out how to work that out. Nothing has completely sold out yet, but some sizes are sold out. Some things are really popular online, but they weren’t popular in the store. We’re constantly, every day, launching new items on Facebook and suggesting fans check it out.”
Bryson, Tanna, Tessa and Michelle with their first-prize check.
Wednesday, May 16, 9 a.m.: Tanna wins!
Eden in Love takes the top prize of $25,000 in the “This is Retail” video contest and Tanna is called a “shining star” by National Retail Federation. Nearly a million votes were cast nationwide from April 3 to 22.
“When they announced second place I knew we had won,” says an elated Tanna by telephone from Washington, D.C. “We were so excited we wanted to scream and stomp our feet but we also wanted to honor the second-place winner’s moment. But I just felt, ‘I can’t believe we did this.’ … The cool thing is that we were able to show people that you can use retail as a platform to give back and that giving back matters. That was always the mission – to have opportunities to do good. No matter if you’re a small or large business, you can make a difference.”
The Dangs wanted to give half of the prize money to their videographer, Julian Gilliam of 10th Letter Media, and the rest to a Third-World rural village – yet to be chosen – to help the village use retail to support itself. Gilliam thanked them for their generosity, but told the Dangs that he wants all the money to go to the village.
Tanna says their plan is to someday visit the village with Gilliam to see their gift in action.
“We want to go to the village, help support what they grow or create, and help them be sustainable,” Tanna says. “We want to pay it forward.”
U.S. Online Retail Sales
Source: Forrester Research
BOSS survey on Hawaii Retail
Read the rest of the BOSS Survey at www.hawaiibusiness.com/Hawaii-Business/June-2012/Hawaii-Business-BOSS-Survey-June-2012.
Retail’s Future Is Now
The truth is this: Online sales are a growing piece of retail’s future, social media are helping make it happen and your store could die if you don’t keep up.
“We’re talking about commerce on social media sites,” says Carol Pregill, president of the Retail Merchants of Hawaii. “It means mobile commerce on iPhones to get alerts from stores saying, ‘I have this and this on sale today and here’s a special coupon.’ Not just browsing websites, but actually making purchases on your iPhone.
“For merchandising, this is the very latest. There’s not just social interaction, but commerce on Facebook.”
Forty-seven percent of Hawaii companies don’t yet sell online, compared with 53 percent who do, according to the latest Hawaii Business BOSS survey. But, Pregill says, the time has come when “every retailer has to have an online presence.”
A consumer survey by Qmark Research that was tied to the BOSS survey found that Hawaii’s holiday shoppers spent an average of more than $1,000 during the 2011 holiday season, and they made 9 percent of their purchases online.
“Thirty percent of the people we interviewed did purchase something online,” says Barbara Ankersmit, president of Qmark. “… I have a feeling that’s going up.”
Pregill says regular retail stores nationwide saw an increase of 3 to 4 percent a year over the past three years, while Internet sales increased about 15 percent a year over the same period. Nationwide, 53 percent of Americans bought something online last year, according to a study by the Forrester Research firm.
Store Apps on Your Phone
At a conference last year sponsored by the Retail Merchants of Hawaii, both Home Depot and Target explained how their smartphone apps work after customers download them.
“You walk in the store and immediately on your phone there’s the store layout,” says Pregill. “You program what you want and the map will take you directly to where you want to go and show what’s on sale. The sales associates have them, too, and they can tell you if it’s in stock and when it will be if it isn’t.
“Most of the time the research done to create these ‘blueprints’ come from the largest stores in the marketplace doing ecommerce. It helps the smaller retailers gear up and get in line to compete. For instance, some retailers, for their Black Friday sales, you don’t even physically have to be there. You can order on your iPhone and pick it up later at will call.”
“I don’t know of any industry as competitive as retail,” Pregill says. “Whether it’s big box or luxury, everybody seems to be moving in this direction. It doesn’t require a lot of money, but it takes time and effort.
“A lot (of small stores) use Facebook, which is essentially free, just to reach their customers. They seem to have a smaller, more targeted following. They have to know their customers better than anyone else. But it all depends whether they can manage it. If they’re a small retailer, they may not be able to, because it takes time.”
Leveling the playing field?
How much revenue does the state lose because residents don’t pay the excise tax on online purchases?
According to a study by Lowell Kalapa, president of the Tax Foundation of Hawaii, the amount could be anywhere from several hundred million dollars a year to as little as $15 million.
“I don’t think anybody really knows,” says Kalapa, who also looked at estimates by the state auditor and Bill Fox of the University of Tennessee, an expert in the field.
Hawaii’s Legislature is one of many across the country trying to raise revenue with what is called “e-fairness” legislation, says Carol Pregill, president of the Retail Merchants of Hawaii.
“There are 12 states that are very close or have an e-fairness regulation or are working on it. They’re looking for revenue,” Pregill says.
It’s also a way to “level the playing field for the bricks-and-mortar businesses,” says Sherry Menor-McNamara, senior VP for governmental affairs at the Chamber of Commerce of Hawaii. “The bricks-and-mortar businesses are at a disadvantage to the Internet and catalog businesses, which have no tax mandates.”
However, an e-fairness bill failed to pass the state Legislature this year because of disagreements between the House and Senate conferees.
Online retail giant Amazon has opposed paying state sales taxes in the past, but now supports federal legislation to require all larger online retailers to collect state sales taxes in cases where states simplify their tax law enough to reasonably allow it.
“New York has been collecting this tax since 2008,” says Kalapa, who has testified to the Hawaii Legislature on the subject. “And California will begin collecting this September. Maryland is also going to start collecting and a number of other states are implementing the same law.”
Hawaii’s Legislature considered a couple of ways to implement an e-fairness tax, including what’s called the Steamlined Sales Tax. The House and the Senate each passed different versions of an e-fairness bill, SB 2226 HD2, but they were unable to compromise on their differences during a conference committee near the end of the session.
Sen. Carol Fukunaga favors the Steamlined Sales Tax approach, but Kalapa is less enthusiastic because he says that option would force Hawaii to change its excise tax or implement a true sales tax.
“Everyone in the world envies our general excise tax, because we have such a low rate because the base is so broad,” says Kalapa. To generate the same revenue, the sales tax would have to be about 10 percent, he says, though others think it might have to be as high as 16 percent.
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