Growing revenues through a new channel
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Company: The Great Little Trading Company
The story: A catalogue trading company goes online allowing it to offer a more up-date product offering
Founded in 1998, by American expats, Allyssa Lovegrove and Caroline Clark, Great Little Trading Company has a turnover of around £14.5m. While the company was launched primarily as a mail order catalogue business, internet sales have grown steadily and now account for a quarter of the total.
Joint managing director Alyssa Lovegrove describes the company as a 'department store' for families with children under twelve years old. The goods on offer ranging from clothes to furniture. From the outset the aim was to provide parents with an opportunity to buy products that might otherwise be hard to find. "As parents we could see that there goods that were difficult to get. We (Lovegrove and Clark) are both Americans and we knew that there were things that were available in the US that were absent on the UK high street. We saw a gap and we started the business."
While the mail order catalogue still accounts for the bulk of the company's turnover, Lovegrove stresses that Great Little Trading Company has been transacting on the net since 1999. However, it has taken some time for online sales to rise to their current level. "At the moment, we do about 25% of our business online, that's up from about 15% twelve or fifteen months ago," she says.
While noting that the rise of web sales has matched the decline of postal (as opposed to phone) ordering to something close to zero, Lovegrove does not believe that the increase in online activity simply reflects a shift in traffic from one channel to another. "There is some element of transferring across, but I think the online business has grown because of the things that we can do on the internet."
For instance, while the mail order catalogue has to be created months in advance of publication and is static, the internet is dynamic. "During the heatwave, we were able to focus on summer products on the website and that boosted sales," she recalls.
Lovegrove also sees the internet as a customer service tool. Buyers can track and trace their status of their orders, whether ordered online or off. This highlights the need for an integrated stock control and fulfillment system. " You have to have an integrated system across all the channels," she says. "One thing that is drives people nuts is if they place an order online and it isn't in stock," she says.
Great Little Trading Company outsources the fulfillment side of the business, meaning that much of the technology is the responsibility of a third party. Nevertheless, Lovegrove estimates that upgrades to the site itself tend to cost around £50,000. While she expects online business to grow, she admits that the company could be doing more to boost internet sales. "To date, we haven't tried to recruit customers online. We want to do more of that through techniques such as affiliate marketing," she says.
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