Case study: Integrity Data

In the past, the small but successful Adelaide business had been a bricks-and-mortar business with a Web site that did little more than advertise the company's existence and its enterprise products. When the company, which has just 15 staff, added Lucent's Orinoco brand of home and SOHO wireless LAN products to its catalogue, though, it had to look outside its normal sales channels to market the family of products.

"We believed we had the market and the product that could be filled by an e-commerce strategy," said Integrity CEO Ross Chiswell.

"We had a particular wireless technology that is aimed specifically at home and SOHO markets and we wanted to publicise it and make it readily available. We found those markets could not be put through our normal distribution channels because of the price points we had to try to achieve - to do that, we would have had to cut our margin to sustain the margin for the channel. So we more or less took the product out of the retail sector, where we have trained people who are really going after enterprise business, and put it into an e-commerce solution.

"The same product had been taken by about five sites in the United States and between them they were moving about $US500,000 worth of product a month. Obviously, they had more people than Australia, but it still looked viable.

"We looked at how the US sites were set up and designed ours from there. Ours is a more focused site than theirs - it concentrates on a single family of products - and it can do everything, so there was a little bit of a difference."

Integrity opted for a .com address rather than a .com.au to give it more of an international flavour, and went for a URL that was product-related rather than associated with the company. As a result, the site is at www.ezywave.com and Integrity's corporate site remains at www.integritydata.com.au.

Said Chiswell, "We had looked at the take-up of e-commerce in Australia and the main things that had prevented it. The main problem we came across, which I think is still holding it back to a certain degree, is concern over security of information.

"So we looked at who had the best branding for security and selected Telstra. To say that the e-commerce transaction was held by Telstra - even though they had a CamTech platform behind it - gave the perception in the marketplace that the site was safe."

Integrity searched for a platform that would allow it to add products and edit information and pricing easily without requiring continual coding and therefore continual cost.

"In the end, we spent the money on buying the graphics, logo and image of the site and then used a boxed product called Vend*It so we could add, change and modify the site. It is a very simple process for our administrator to make price changes or add or delete product," said Chiswell.

The total cost came in at less than $10,000, and because of the initial setup it requires only a few hours work a week by one person.

The site was launched quietly in October last year. Integrity paid a fee to have it promoted through various search engines, but most of the promotion comes from within the company.

"Our marketing people use the site as their own silent salesperson. Rather than being a channel manager or a sales representative, it is marketing's own electronic salesperson," said Chiswell. "We will be doing some campaigns to promote it later in the year and will launch a campaign in June that specifically targets Qantas Club members."

Meanwhile, Chiswell says the site has already paid for itself. "There were a few early teething problems, but nothing major. Telstra used Westpac but our accounts were with National Australia Bank, so we had to make some adjustments there, and we had problems with our original freight forwarder who dumped $1000 product at the customer's front gate in the rain without getting a signature. But apart from that, everything went smoothly."

The move to a clicks-and-mortar business has not only boosted the bottom line, it has gained the company plenty of recognition. Integrity Data is now a finalist in the Telstra Small Business of the Year Awards.

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