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					April 23, 2001



 Special Report - Breakaway: A Focus on Small Business


 Domain Blossoms
 Florist.com address proves a rainmaker for a small Beverly Hills
 business

 By RANDYE HODER

 What's in a name? To Aron J. Benon, owner of an online retail flower
 shop, Florist.com, the answer is simple: profits.

 In a world when many consumer-oriented Internet start-ups have
 gone belly up in the past year, Mr. Benon credits a big part of his
 success to having the right domain name.

 "There are thousands of people who when they decide they need
 flowers, they type in Florist.com in their browser and they come to
 me," says Mr. Benon, whose Beverly Hills, Calif., company has been
 steadily profitable since the launch of the Web site
 (http://www.florist.com/ ) in August 1997. "I don't have to pay a dime
 to get those people to my Web site. If you have a good domain name,
 it just drives traffic."

 With virtually no advertising, Mr. Benon has increased his sales from
 $247,000 when the site began to $3.8 million last year. And while
 that doesn't come close to the revenues generated by his much bigger
 corporate competitors, 1-800-Flowers.com
 (http://www.1800flowers.com/ ) and FTD.com (http://www.ftd.com/
 ), for a small-business man who started out with a corner flower shop,
 it has been a bonanza.

 Just Getting By

 Had he stuck strictly with the brick-and-mortar business that he has
 run since 1989, he says, "I knew I could work very hard for the rest of
 my life and just get by." But by venturing out on the Internet with the
 name Florist.com, "I knew I was on my way to real wealth," says the
 38-year-old Mr. Benon.

 Business consultants caution against reading too much into a story
 like Mr. Benon's, noting that building a strong brand identity and,
 above all, having a sustainable business model have come to be
viewed as far more important ingredients for online success. Indeed,
plenty of other companies with the perfect appellations for their
businesses -- Pets.com and Garden.com, for example -- have failed.
"There are a lot of carcasses on the Internet trail from people who had
great names and nothing else," says Victor Hwang, chief operating
officer of the Los Angeles Regional Technology Alliance, which
supports high-tech companies in Southern California. "The name is a
helpful tool, not an end solution in itself."

Nonetheless, for an entrepreneur, having the right name can be an
important weapon to compete effectively. "It's a way for a small
business to level the playing field," says James Klein, associate
director of EC2, an Internet incubator at the University of Southern
California in Los Angeles. Adds Stephen Elias, a trademark lawyer
and co-author of the book "How to Choose and Protect a Great Name
for Your Web Site": "You have to be a good businessperson. You
have to be smart. But having a great generic name is going to make a
big difference if all the other pieces fall into place."

Questionable Choice

It certainly has for Mr. Benon, though things didn't start out that way.
He took his business onto the Web as sales at his three Los Angeles-
area flower shops were starting to decline as a result of heightened
competition. He picked the URL, or domain name, that seemed most
natural, sticking a dot-com at the end of the name of his tiny chain,
Floral & Hardy. Quickly, though, he realized that he had blown it.

"Nobody would ever know who we were without a ton of
advertising," Mr. Benon says. And that "we couldn't afford."

But then, serendipity struck. Surfing the Internet, Mr. Benon
stumbled on a now-defunct online shopping center called Branch
Mall that featured links to a host of Internet flower merchants. Mr.
Benon signed up, and the next day floralandhardy.com had a link as
well.

That same day, he received his first order. When he contacted the
patron and asked him how he found floralandhardy.com, the customer
said he had simply typed in "Florist.com," landed at the shopping
mall and picked Mr. Benon's store.

Until that moment, Mr. Benon hadn't realized that people could zip
right to the mall by typing in Florist.com. "I never thought that people
would just type in some generic name," he says. But suddenly
"fireworks went off ... I realized that was the key."

By then it was late on a Friday afternoon, and Mr. Benon had to wait
until Monday morning to make the phone call that he assured his wife
"would change our lives forever." At 5 a.m. he dialed the East Coast
and contacted the owner of the Branch Mall. Within minutes, Mr.
Benon agreed to buy the name Florist.com for $15,000. "I was
thinking that if he [the owner of the Branch Mall] picks up the phone
and calls FTD or 1-800-Flowers, they would have bought it for much
more," Mr. Benon says. "I sweated the whole time."

He isn't sweating so much anymore. Last year, Mr. Benon says, his
closely held company earned $332,000, up from $181,000 in 1999.
To focus on the Internet, Mr. Benon has closed two of his three shops,
and even the remaining signature Beverly Hills location -- which he
says caters to Hollywood stars including Michael Douglas, Drew
Barrymore and George Clooney -- barely has any flowers in it
anymore. Most of the space is now taken up by desks with computers
perched on them. Of his nine employees, seven are devoted to the
Internet.

A good name isn't the only thing that Mr. Benon's business has going
for it. He takes pride in having managed his Internet operation just
like he managed his walk-in stores: very conservatively. In fact, he
didn't borrow any money to start his Web site, even turning down
offers of financing from venture capitalists who were attracted by the
generic name he had corralled. Instead, he paid for the Florist.com
URL in 15 monthly installments of $1,000.

Name-Game Competition

Despite Mr. Benon's cautious approach, there are sure to be
challenges ahead. Revenue growth is expected to slow this year as the
economy weakens. In addition, some note that a number of new
domain-name suffixes are slated to soon become available, making
possible URLs such as Florist.biz and Florist.pro, which could sap
business from Mr. Benon's company.

Also, some question whether Florist.com can survive long term
against its much larger rivals, unless Mr. Benon can find a niche in
which his company can distinguish itself. In January, Florist.com
attracted 152,000 visitors to its site, according to Media Metrix, an
Internet tracking firm in New York. That was dwarfed by the 1.3
million visitors who clicked on 1-800-Flowers.com and the 451,000
who went to FTD.com.
One advantage that the bigger industry players enjoy is an expansive
network of flower shops around the U.S. that can guarantee local
deliveries. "That gives us a competitive edge," says Mike Soenen,
president and chief executive of FTD.com, Downers Grove, Ill.

Mr. Benon, by contrast, still needs to cultivate his own, more limited
network of florists nationwide. That reality hit home this past
Valentine's Day when his Web site was deluged with 8,500 orders --
about 500 more than Florist.com could easily handle. In some cases,
when the company couldn't find local flower shops in various parts of
the country to fill its orders, Mr. Benon's staff had to call back
customers and offer apologies, along with a 10% discount for a year.

But in the end, Mr. Benon believes he can overcome all of the
obstacles, in large part by keeping things in perspective.

With the Florist.com name, "I get enough of the market share to do
well," says Mr. Benon. "That's great for a guy like me. I don't have
illusions of grandeur. I'm happy to serve a smaller number of people
really well, increase our profits and stay the course. I don't care about
being the biggest."

-- Ms. Hoder is a writer in Los Angeles.

Write to Randye Hoder at breakaway@wsj.com

				
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