Prodigy: Smart Sales Channel?
The first in a series on interactive marketing.
Bill Tobin had no intention of running any flower shops when he bought a chain of florists in 1989. He was anxious to get into on-line marketing, offering computerized floral delivery via the FTD network.
Today the number of electronic networks is growing, but Prodigy -- one of the earliest on-line services -- still offers the most marketing-friendly format. Tobin's PC Flowers was one of the first vendors to sign on.
"Prodigy was going about interactive marketing the right way, offering graphics and geared toward the family," says Tobin. Prodigy's main competitor, CompuServe, was more techie-oriented, he decided. Today PC Flowers, with sales topping $10 million, is one of Prodigy's top merchants.
What's Tobin's secret? In a word: service. "You're dealing with a highly sophisticated consumer with a low threshold for problems," he warns. (Prodigy's average user earns a $60,000-plus annual income, is college educated, and has a mortgage and two children.)
Merchants must deliver crackerjack service from day one, he stresses. If there are too many customer complaints, Prodigy dumps the offending seller. At PC Flowers, based in Stamford, Conn., and Oakton, Va., customer complaints are immediately met with a free floral arrangement and a cash refund, sent by one of the eight staffers. To minimize problems, PC Flowers details every step of the ordering process -- down to providing digitized pictures of arrangements.
Speed is essential. Prodigy users browse the network for an average of 20 minutes a visit, necessitating laser-beam marketing. PC Flowers' ads fill the bottom of Prodigy's menu screens, featuring a "click" box users can select to "jump" to an order menu.
Prodigy provides software to download orders from the system, but Tobin whipped his order processing into shape before going on-line. In 1989 he invested more than $100,000 in a computer system that takes orders, bills credit cards, and ships purchase orders to the FTD network within 57 seconds.
-- Phaedra Hise* * *
Owners: IBM and Sears
Members: 2 million
On-line merchants: 40
Advertiser slots: 100
Message boards: 420
Small-business forums: 2
Fees: $25,000-plus to set up screens, plus 10% of sales for merchants; advertising rates vary
Phone: 800-776-3449* * *