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Sunday, December 28, 2014 |  Madison, WI: 25.0° F  A Few Clouds
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Retailers here attract a global customer base
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Say you're redecorating and want to buy the perfect objet d'art for your dining room buffet. Type in "art glass" and you'll find the Madison-based website artfulhome.com, with dozens of tempting choices.

"I feel like the Internet was invented for the art world because it was so disorganized," says Artful Home founder Toni Sikes. "There are so many talented artists, but so few distribution channels for their work." Websites like Artful Home have created new ways, besides art shows and galleries, for artists to connect with consumers.

E-commerce, the buying and selling of merchandise via the Internet, has transformed the marketplace for many Wisconsin businesses. From major retailers like Land's End to small specialty businesses like RP's Pasta, Madison-area companies can attract customers from across the country and around the world.

It's also been a boon for consumers, who now can find what they are looking for simply by entering a few keywords into a search engine. Selling over the Internet offers some advantages over other kinds of businesses. For instance, overhead costs are commonly lower; inventory can be kept in storage, not stores. But Internet success requires sophisticated marketing strategies and technology.

"Selling online is hard," says Sikes. "E-commerce is not just about having a website. You also need a support infrastructure, web developers, marketing experts, people who know how about search and advertising.

"We have to dispel the myth that all you have to do is put up a website and they will come."

Support for e-commerce enterprises in the Madison area comes from private businesses - website designers and web marketing experts - and from the University of Wisconsin and its Small Business Development Centers.

About 60 large Midwestern businesses, including American Girl Inc., the Brady Corporation and Sonic Foundry, are members of the UW E-Business Consortium (www.uwebc.org). They pay $8,000 a year to participate in this educational and networking support group. The consortium offers intensive seminars on marketing, customer service and a variety of other topics, with faculty and staff representing business, computer science, engineering, human relations, marketing and dozens of other specialties.

Hundreds of smaller e-commerce entrepreneurs have enrolled in classes to learn about web marketing through Small Business Development Centers at UW campuses, according to Sandra Bradley, the consortium's director for web strategy and marketing.

"For an online business to be a success, people have to be prepared for all the management issues," says Bradley. "It's not enough to just get the product up. You also have to think about who will take the orders and how you'll handle shipping."

Attracting attention is also critical. The two strongest tools for online retail are search and affiliate marketing. Getting search right means your business appears when people type in search words. Affiliate marketing is the art of placing ads or getting mentions on other websites.

Another component is what Bradley calls a "key differentiator" - communicating why people should buy from you. These are things like price or customer service or convenience.

A decade ago, many consumers were wary about making purchases on the Internet. But, notes Bradley, "We are at a point now where more than 50% of sales for our companies are online. It's a tipping point, and it is steadily going in that [online] direction."

Until the last few months, it appeared that the trend toward shopping online was unstoppable. People accustomed to getting their books from Amazon.com, their shoes from Zappos.com and their music from I-Tunes, would increasingly use the Internet to shop for other goods and services.

Now, with the stock market in the tank, a massive credit crisis and a multibillion-dollar federal bailout for failing banks and investment firms under way, what's the future for Wisconsin firms engaged in e-commerce?

Some web retailers are cautiously optimistic.

"In a recession, people whittle down their wants, and what we sell is a 'want,' not a 'need,'" says Ron Roloff, owner of Strictly Discs, an independent music CD and record business, and strictlydiscs.com. "But we haven't seen much of a dip. Buying music is just a $20 treat. It's not super-expensive."

Linda Remeschatis, who owns WisconsinMade.com, an online store that features Wisconsin food items, books and clothing, agrees: "This economy will affect our business a little, but people are not going to stop giving gifts. I expect a little slowdown, but it is not too much of a concern."

But Bill Bass, co-founder and CEO of fairindigo.com, a fair-trade clothing retailer, is feeling the pinch: "We feel like the poster children of the credit crisis." His business, which also has a store in Hilldale Mall, has scaled back plans for expansion because of the economic downturn.

"We pay workers to make the clothes before we sell them, so there is always a gap between when we spend the money and when we get paid," says Bass. "Until now, we covered that gap with bank loans. Last summer, bank lending dried up, and that caused a huge impact on our business. And on everybody else."

Bass says banks typically would lend about half the cost of producing inventory before the Wall Street collapse. Now those loans have vanished. How is he coping?

"We had planned to open one or two additional stores a year starting in 2008 and 2009. We have decided not to do that now. And we will not mail as many catalogs this year. We'll continue to send catalogs to existing customers, but we won't be sending as many to potential new customers. Catalogs are a very expensive way to reach new customers."

Bass sees no way to predict how long the current economic crisis will last; his company will proceed carefully and continue to stress customer service.

"We believe that our current customers are staying with us," he says. "But I think we are getting fewer new customers recently."

Artful Home, where Lisa Bayne took over as CEO last winter, is looking to the holiday shopping season with optimism.

"This economy affects us, just as it does everyone," Bayne says. "But gift-giving exists, regardless of the economy. We have a wide variety of work and price points, so people can find something that is artist-made and special."


Artful Home
www.artfulhome.com
931 E. Main St., Suite 9, Madison
877-223-4600

This Madison-based art dealer sells work created by about 1,200 artists. Judy Kolka, who handles the company's public relations, declines to reveal how many customers shop the site or how much business it does. But she does peg it as one of the nation's top 500 Internet retailers.

The company grew out of an existing business, The Guild, which began publishing a color catalog of available artworks in 1985. Founder Toni Sikes saw possibilities in an online electronic catalog that could reach consumers directly.

"It is so much better to actually be able to see a piece of work, but [this disadvantage] is balanced by being able to locate the specific thing you are looking for," says Sikes. "There is no place I could go in person to see this variety of choices."

To boost customers' confidence in the quality of the artworks, every item is vetted by a jury headed by Michael Monroe, the chief curator at the Bellevue Art Museum in Washington state.

Ann Cabezas, a glass artist with a studio in Mineral Point, estimates that about 75% of her sales come from Artful Home. Her delicate blown, sandblasted and hand-painted bowls take up to a month to complete, and retail for between $950 to $2,000. She's happy about her relationship with Artful Home and the Guild catalog, where her work has been sold since the 1990s.

"They reach markets I could not possibly reach," she says. "They really promote the people they represent, and they are pleasant, helpful and there when you need them."

Richard Judd, who makes handcrafted wooden furniture at his workshop in Paoli, is also pleased with the market the site has opened for him, currently about a third of his business.

"I was skeptical at the beginning," says Judd. "I wasn't sure people would buy without seeing and touching the work. But the deal-maker for me was that Artful Home hired one of the country's foremost art authorities to help them develop the website. That gave them so much credibility with me."


Strictly Discs
www.strictlydiscs.com
1900 Monroe St., Madison
608-259-1991

Looking for a rare old jazz LP? A CD by that Europop band you danced to in Amsterdam? Or just in the mood to buy tunes from an independent music store?

You could visit Strictly Discs, a funky little music shop on Monroe Street. There are bins of new and used CDs and signs that tempt patrons with the promise of finding musical treasurers from jazz to rock, from mainstream to rare, from new to classic.

Or you could go to www.strictlydiscs.com, the store's even more extensive website, which lists up to 20,000 titles on vinyl as well as a deep inventory of CDs. The National Association of Record Merchandisers recently nominated it as the Best Independent Music Web Site of 2008.

"Our site is unique and has great features," says owner Ron Roloff, who opened Strictly Discs as Madison's first all-CD music shop in 1988 and moved to the Monroe Street location three years later.

Web sales are growing, but still account for less than 10% of total sales. Roloff says many web customers frequent the store, browsing and placing orders online, then coming to the shop to pick up their purchases. Other web customers log in from all over the U.S.

"The website has a lot of potential, and we could expand the business by 100 times," Roloff says. "But we want to concentrate on local and regional marketing first."


WisconsinMade
www.wisconsinmade.com
877-947-6233Z

Wisconsinmade.com sends unique Wisconsin products - from cheese to Packer gear to pottery - to people all over the world.

Linda Remeschatis, who founded this Internet-only business in 1999, says many customers are past or present state residents who "want to send something made in Wisconsin as a gift." Food products like baked goods and bratwurst are the biggest sellers, but the site also offers apparel, art, books and home-and-garden items. In all, it lists more than 2,000 Wisconsin products, and sales last year topped $800,000.

Remeschatis came up with the idea for Wisconsin Made while visiting cheese makers, maple syrup producers, woodworkers and other artisans and going to art fairs while traveling around Wisconsin in the late 1990s. "Many of them," she says, "were very interested in using e-marketing to sell their products nationwide."

The company launched a new and improved website in October, with a friendlier navigation and search capacity and an "address book" that lets regular customers avoid re-entering information for friends and family to whom they sent gifts previously.

Remeschatissays the Verona-based business has grown steadily and currently employs five people, who do marketing and customer service and produce a newsletter. Most products are shipped directly from the producers.

"We see a lot of potential for continued growth in the next 10 years."


Sarah's Hope
www.SarahsHOPEJewelry.com
608-824-9277

Sarah Smith sells beautiful jewelry through high-end jewelry stores throughout the U.S. The pieces are also available to individuals through her website, but Smith considers the website primarily as a way to share stories about the mission of her business - to make a difference in the lives of women living in poverty.

"We donate 10% of our profits to fund micro-loans for women in developing countries, including Nicaragua, (Sarah's Hope, cont.) Pakistan and Afghanistan, and to provide business education for women in poverty in the U.S.," she explains. The loans are made through Mennonite Economic Development Associates.

Sarahshopejewelry.com, now in its fifth year, features photos of lovely, colorful stones in pretty settings designed by Smith and crafted by professional silversmiths. There are also stories about women for whom a micro-loan has been a life-changing event.

"One of my favorites is the story of Elia Rose from Managua, Nicaragua, who used her $250 loan to buy flour in bulk to make tortillas to sell in her neighborhood," says Smith. "She went from earning about 45 cents a day to $2 a day, the average wage in Nicaragua, and that makes it possible for her children to go to school."

Smith's Middleton-based business is thriving.

"I believe that business can also be a mission and can make an economic, social and spiritual difference," says Smith. "I love what I do. I love the jewelry. But I'm passionate about the women."


Fair Indigo
www.fairindigo.com
Hilldale Shopping Center
800-520-1806

Fair Indigo was founded five years ago by five former Land's End employees who saw a market for fashionable, contemporary, high-quality fair-trade clothing.

"We looked around and could not find fair-trade clothing that wasn't handmade, ethnic clothing," says co-founder and CEO Bill Bass. "There just wasn't much in the way of normal clothes that were fair trade."

In 2006 the company launched its flagship store in Hilldale as well as its website, drawing coverage in both The New York Times and Time magazine. That publicity and a search engine advertising campaign got a buzz going.

"Within 30 days we had customers in all 50 states, and in Canada and the U.K.," says Bass. "We had thought [our products] would appeal to people in college towns like Madison, Austin, Berkeley and Chapel Hill. But we found that the demand was much more widespread."

The company is headquartered in Middleton and has about 32 full-time and hourly employees. The product line includes clothing for men, women, children and babies as well as jewelry, accessories and gifts. Internet sales now account for 70% of the company's business.

Says Bass, "One of the great things about the Internet is that it doesn't matter where customers are, they can find you."


Other local web retailers

Many Madison-area retailers have embraced online marketing. Here are just a few things you can get without leaving home.

Trendy clothes from shopbop.com. The business, Bop, has a retail outlet just off State Street, at 222 W. Gorham St., but does a big part of its sales online.

Gourmet fresh pasta from rpspasta.com. This ultimate comfort food is also sold at RP's Pasta, 1133 E. Wilson St., local supermarkets, and the farmers' market.

Groceries from sentryonthego.com. The website lets you place your order online; the store will pull the items and deliver from the Hilldale store to homes in Madison, Cottage Grove, McFarland, Sun Prairie, Waunakee, Monona, Middleton, Oregon, Verona and Fitchburg.

Easy-to-use picture hangers at thumbsuphanger.com. A local inventor came up with Thumbs Up Hangers, a clever gizmo for hanging pictures without wielding a hammer or risking your thumb.

Handmade gourmet chocolates from gailambrosius.com. Gail Ambrosius chocolates are also available at the shop at 2086 Atwood Ave. and other retail outlets. But if you have a chocolate emergency and can't seem to get off the couch....


The UW's E Business Consortium: Current members
Alliant Energy
American Family Insurance
American Girl, Inc.
Appleton
Bemis Flexible Packaging
Brady Corporation
Briggs & Stratton
Case New Holland America
CDW Corporation
Cook & Franke, S.C.
CUNA Mutual Group
DEMCO
Dorner Manufacturing/AutoLogik
Drs. Foster & Smith
Eastbay/Footlocker.com
Endries International
Figi's Inc.
Grainger
Harley-Davidson, Inc.
Hospira, Inc.
InPro Corporation
J.J. Keller & Associates Inc.
JX Enterprises
Kohler Company
Kraft Foods Inc.
Lands' End
Madison Gas & Electric
Marshall & Ilsley Corporation
Mason Companies, Inc.
Master Lock
MJBmc, LLC
Monsanto Company
NewPage Corporation
ORBIS Corporation
Pacific Cycle
Plexus Corporation
Promega Corporation
RedPrairie
RF Technologies
Rockwell Automation
Sargento Foods
SC Johnson
Schneider National
Seneca Foods
Skyline Technologies
Sonic Foundry
SpectraCom
Sub-Zero, Inc.
TDS Telecom
The Manitowoc Company
The Swiss Colony
The University Book Store
Tosca, Ltd
Uniek, Inc.
Whirlpool Corporation
Whyte Hirschboeck Dudek S.C.
WI Manufacturers & Commerce
Wipfli LLP
Zebra Technologies Corporation

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