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Aug 21, 2000
Case Study

Alco Ventures Uses Discounts to Lure 70% of its Building Contractor Clients Online

SUMMARY: No summary available.

Custom railing and screen manufacturer Alco Ventures has had a token, “brochureware” Web site since 1996. Last Fall, President Ben Hume decided to get serious with his company’s online presence, “The cost of doing business is driving us online.” By switching to an online order process he hoped to save on order entry and data management costs. Only problem, Hume’s customers are all building contractors -- “They all have big fingers with bumps and bruises on them!” -- not exactly computer-whiz types.


Hume realized his customers care about cost above most other considerations. So to get them online, “we kinda forced the issue by offering them discounts that made it worth their time. We added a 5% Internet order processing discount plus an additional 3% discount if they used their credit card.”

Hume also added compelling content to his site, including an order costing calculator, useful shop drawings, critical sections from both the US and Canadian building code manuals, and a picture gallery customers could use to download graphics for their own marketing materials.

In addition Hume got his entire company, from the sales department to product development, to become more Web- centric. “We’ve made a huge cultural shift within the company. When customers call in with questions, sales refer them to the site. Production has a single source of what’s correct, and that’s what’s on the site. Our print
catalog is generated from the Web.”


Alco ventures customers were so delighted with the idea of saving money that within a few months almost 70% made the switch from ordering by phone or fax to ordering online. “We have customers who got an Internet hook-up just for that discount!” At first the sales team had to do a lot of handholding, “we got lots of phone calls for customers’ first online orders.” They didn’t mind because the Web made their jobs easier -- telling someone to go to a Web page was easier than looking up and faxing over building code by hand. The ability to take credit cards online also “compressed our sales cycle.”


The company developed the site in-house, using Multiactive Software’s Entice! e-business Suite to provide Internet commerce solutions. Hume chose Multiactive because his team was already using the Company’s Maximizer software to manage accounts.


Hume warns others that business customers expect instant perfection online, “once customers get into the Web, it really raises the bar in terms of their expectations of your company. It saves them time but when it doesn’t work they’re really unhappy with you. You’ve got to be prepared for that. The bar gets raised instantly, it’s not something that takes time.”
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