Global E-Tailer Targets 13 Countries
The start-up covered the 15 EU countries, the US, Canada and Switzerland. This year boo.com will open in Norway, Argentina, Australia, New Zealand, South Africa and Israel, with Asia also on the 2000 list.
Moves are planned first into the English-speaking Asian markets - Hong Kong, Singapore and Taiwan - because so many Asian languages use special characters. Japan, Malaysia, Saudi Arabia, South Korea and Thailand are next.
Japan is a special problem because so few Japanese know English that well. "You really have to be in Japan with a local presence and the right language," said Jay Herratti, president of boo.com North America.
The e-tailer was founded by three Swedish entrepreneurs in January of last year who lined up venture capital support from people like J.P. Morgan, Goldman Sachs and Benetton. "This is a mix of global players and global brands," Herratti said.
Most of the garments are sourced in Asia but boo.com sells them under their brand labels. It launched with 20 brands and expects to show 40 on its sites by April 10, including Speedo, North Face, Converse and Timberland.
"We spent 11 months building a global platform. We had to do two things - build the global interface and then the global distribution and fulfillment network to back it up. And both we have done for the first time," Herratti said.
Boo.com had little precedence to go on. "We had to build an e-commerce engine which is multi-country, multi-lingual and multi-currency." A single, centralized engine draws on the same database but the user interface is customized to the origin of the surfer.
"In the countries where we are online, customers see our offer in their language and their currency." Over time the offer is being customized to fit country of surfer origin, but originally it was not, he said.
"We started off with a consistent range of products offered around the world with slight variations between what we offered in the US and in Europe. We will customize as we collect more data about our buyers."
The first order of business, however, was sizing. Goods labeled in US sizes would not sell to a German who doesn't understand what a 44 men's jacket means.
Customizing payment came next and that involves more than showing local currencies. Germans and Scandinavians may have credit cards but they are reluctant to use them online.
The e-commerce engine's basic grid is a series of columns for different languages which can be expanded as new languages come on line. The engine recognizes the surfer's country of origin and pulls up data in that language, beginning with "buy now."
Payment methods include the individual country's address format leaving room for zip codes which vary greatly across Europe. It also takes cultural and legal differences into account.
Country managers provide information on offers, promotions and sweepstakes, i.e., they are not offered in countries that don't allow them - mostly Germany which has stiff legal restrictions.
"Our front end is fully integrated to our back end," Herratti explained. "As a customer views our site we know at once whether an item is available because the engine is scanning the warehouse at the same time." Boo.com is also hooked into global distribution systems.
UPS handles the US and Canada out of Louisville while Deutsche Post takes care of EU and other European orders from its facility in Cologne. The Germans, Herratti said, "are leaders when it comes to e-commerce fulfillment."
The myriad of commercial documentation needed for shipment is generated automatically in the right language and with the right customs, duties and other formalities.
Boo.com is also building a brand of its own to go along with the 40 it carries. "Our boxes, shipping forms and tissue papers carry the boo.com brand and we put a boo-branded frisbee or hat in the package."
The system went live in the summer and was put through three months of rigorous tests to "friends and family." All boo.com employees lined up prospects to create the live test environment.
"A lot of our friends got a lot of free T-shirts," Herratti said. In return they had to fill out detailed questionnaires on how well each piece of the e-commerce engine had worked.
"We were almost shocked at the end of the season at how well it all worked out," he said. "Some 99 percent of our holiday orders arrived on time as we had promised."
Finally, Herratti believes boo.com will turn profitable quickly because it is not a discounter.
"This is no longer about lower prices but about selection, choice, convenience and value," he said.