There are several approaches to developing the model, from going ‘all-in’ to plugging in affiliates.
Sanoma, for example, has several ecommerce storefronts in a business unit it aptly calls Storefronts. Cobus Heyl asked Antoine Hendrikx, business unit manager of Storefronts at Sanoma Digital, about Storefronts, the symbiosis between content, technology and marketing, magazines and ecommerce and more.
Sanoma invested in Fashionchick some five years ago. Tell us about the start and how Sanoma came to invest in it?
Three typical IT guys working with an affiliate network founded (the original) Storefronts. They launched several sites with affiliate links and soon found fashion (Fashionchick) performing very well. Then Ellen Snijder, a fashionista, joined to write her thesis on online fashion commerce. Fashionchick started to grow very quickly with Ellen as the ‘face’ and with the others optimising IT, search engine optimisation and advertising and so on. Sanoma took notice of the growth decided to invest, initially with a small equity stake adding mainly media and knowledge. In July 2014 Sanoma acquired 100 per cent of the shares of Fashionchick. Three of the four founders are still working with Sanoma, with two still working with Fashionchick.
Fashionchick forms part of Storefronts at Sanoma Digital. Tell us a little more about your overall thinking.
Fashionchick is the women’s fashion portal. A lot of shops and users showed interest for a similar concept for men so Fashionchick decided to set up Men Today using the same technology platforms etcetera. This was before it was integrated into Sanoma Storefronts. Later on, as part of Sanoma they also launched Myhomeshopping.nl (home deco) and Kidstoday.nl (children) as logical areas in which Sanoma had already a presence. And some concepts were rolled out internationally. To cover the variety of brands the business unit Storefronts was created within Sanoma Digital.
What brands do you now have, and in which countries?
Fashionchick (Netherlands, Belgium, Germany, France, Austria and the UK), Mentoday (Netherlands and Germany), Kidstoday (Netherlands) and Myhomeshopping (Netherlands and Germany [the brand is called Hometoday in the German market]). We are contemplating rollouts to several other countries.
It is interesting to see that you have editorial, product managers and engineers working together as a team on each of your sites. Tell us about this.
The composition of the team has been the key to success of Storefronts. The balance this is essential.
We have editorial people, but they are all very commercial focused and they understand how the Internet works. And they work closely with sales. The same goes for the IT guys. They know their IT stuff, but they understand editorial people. And of course there are search engine marketing people managing search engine optimisation and advertising.
A very important element is Ellen, who is protecting the ‘concept’ and ‘brand’ and makes sure whatever we do fit with the brand. She and some other people are also very connected to the ‘fashion scene’ consisting of bloggers, designers and shops, building the community.
How important is content as a strategic ecommerce resource in establishing your unique selling proposition?
It is very important, but again it is all about the balance. Fashionchick and the others take pride in turning the ‘dry’ technology, such as the data feeds from our partner shops, into inspiring content. These two elements work together, but in the end our goal is to send the visitor on a shopping spree at one of our partner stores. So if the content distracts the visitor from this goal, it works against us. But if it inspires the user to buy an item, we have done our job. In addition the importance of content for the acquisition of traffic should not be underestimated.
What are your thoughts on the fit between ecommerce and magazine media?
It’s perhaps not only magazines, but mass media. TV also works. They are both part of a long-term brand building strategy. And they of course provide endorsement of your brand by being a strong brand themselves with strong relationships with their audience. I see a lot of potential in these relationships.
One problem with magazines is that they mainly get their money from customers and are therefore very customer-focused. ‘Advertising’ or ‘commercial’ thinking is sometimes frowned at. That is were we sometimes hit a brick wall. But what’s wrong with showing a TV star and showing where you can buy similar clothes or get the same look?
How do you leverage synergies between your brands in Storefronts and magazine media brands in Sanoma, if at all?
From September 2014 we are in the same building as Sanoma’s magazines. That helps especially as in the end it is all ‘a people business.’ Luckily I have been with Sanoma for 10 years and have worked with the online and magazine divisions, so I know a lot of people. I strongly believe in creating win/win situations. You have to respect each other and know where the other one is coming from.
ECommerce is a tough environment, rife with competition and often operating on scale with low margins. How do you compete within this environment? And what advice do you have for magazine media publishers interested in extending into ecommerce?
It is indeed hard.
While it is fairly easy to earn some money when working in a small group in a low cost environment, in my opinion to be successful in the long run you have to invest and build your brand.
And sustainable ecommerce in my opinion is also only possible when you achieve a balance with the content, commerce and community angles.
(On the fit the differences in DNA, and getting it right):
The internet means content should be ‘fast and good enough.’ In a magazine environment content is always ‘made to be perfect.’ It is a different ball game played by people with different DNA.
Look at revenue models. A full-page ad in a magazine has a very different value from a CPM banner (I think).
You cannot assume you have the same audience. The attention span, situation and/or even demographics might be different in an online environment in comparison to print.
When you look at the beginning of Fashionchick, the ratio was three tech guys and one fashionista (who also loved technology and the Internet).
In my opinion, the mechanics of the internet should lead and these traditionally are not present in a magazine environment. Sometimes you hear: “Yes, but we can learn.” I doubt that. Making magazines is a craft done by people with a certain DNA. You cannot change that easily.
Age is another important factor. Remember: Teenagers and young adults have not known a world without fast Internet and smartphones. They do not care about privacy and so on. That is difficult for older people (including me) to really, really understand.
So creating the right team balance and environment is everything.
You have launched brands in several new country markets in the past. What lessons have you learnt and how do you plan to continue your internationalisation strategy?
- It is not easy;
- Try not to cater too much for country-specific requests in your IT back-end. Your IT / product development will become to slow and too costly;
- Try to make international contracts with international players so that with a roll-out to various countries you are secured with product feeds;
- Become a brand, form partnerships. We tried it on our own but are now also actively looking for (media) partnerships in the various countries;
- Get in locals and assign the project to someone to create ownership; and
- Make up for the disadvantage of not being located in a market by going there on a regular basis. Work on building a network with partners you can trust.
What are your plans for Storefronts in 2015?
In 2015 we want:
- To further develop the brand and the concepts – from a brand-building perspective but also in product and community development;
- Find partnerships in Germany and the UK and with Fashionchick become the number 1 online shopping destination for women; and
- Prepare for a further roll out internationally in 2016.
Hendrikx will speak at the Digital Innovators’ Summit in Berlin, taking place on 23-24 March this year. Join him there.
See examples of the Storefronts sites:
Ecommerce articles elsewhere on FIPP.com
- How media owners are embracing ecommerce
- Three key waves for publishers moving into ecommerce
- Even more
- More stories about Sanoma on FIPP.com
- Search Sanoma in the FIPP Membership directory
- Visit Sanoma.com
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