Company: Dunderdon
Contact: Les Szabo, a Dunderdon director and head of North American sales
Location: Gothenburg, Sweden (U.S. headquarters are in Portland, OR)
Industry: Manufacturer, B2C
Annual revenue: Confidential
Number of employees: 13
Quick Read:
Dunderson, a Swedish manufacturer of high-end urban clothes, wanted to expand its clientele to key the US market. Since the vast majority of its business came from third-party retailers selling to European consumers, it had limited exposure to Americans—mostly through one retail outlet in New York City. At the same time, it wanted to shift its business model more toward direct business-to-consumer sales via its Web site.
Dunderdon.com was re-launched in Sept. 2006 as a community-focused e-commerce site, with several new branding components and, for the first time, the capacity to conduct online sales. Within six months, Dunderdon's U.S. online sales grew from nothing to about 10% of all sales. Foot traffic and sales at its New York retail store increased as well.
The Challenge:
Founded in 1997 by a Swedish carpenter who wanted to create reliable yet stylish clothing for artisans and craftsmen, Dunderdon had a loyal niche following in Sweden and other European countries, but no name recognition in the US. Another problem: its website, while informative, didn't offer a way for customers to purchase its products. To penetrate the US market, Dunderon had to create a new, e-commerce-oriented website that established a hip image for itself in the crowded US marketplace.
Campaign:
The Swedish firm recognized that it wouldn't be easy for a foreign firm to create a group of loyal US Dunderdon evangelists. But Les Szabo, Dunderdon's Portland-based head of North American sales, saw that developing such a strategy was crucial. The company's sales had grown in Europe with the help of Web-savvy Dunderdon devotees, and he wanted to replicate the process in the US.
"We are trying to create a community that doesn't know it is a community. We know they are out there, and the Web site should offer them a venue," Szabo said.
He hired Portland online marketing firm eROI Inc. to re-launch Dunderdon.com as a community-focused e-commerce site. In an unusual arrangement, Dunderdon signed a four-year pay-for-performance contract with eROI. The marketing firm is paid, after expenses, an amount equal to 10% of all sales generated through the Web site. The payment structure gives eROI a real incentive to meet, and surpass, the campaign goals.
eROI concentrated on a few key themes as it redesigned Dunderdon's website to make it more engaging and feel like a community that celebrated musicians, other artists, and craftsmen. The new site includes:
- A section called "work.space, a journal of workers working," which profiles local artists, designers, and craftsmen who define Dunderdon's core audience. Those profiled aren't necessarily wearing Dunderdon apparel, and they make no mention of their attire. The section moves from city to city and invites consumers to contribute their stories, almost like a personal mySpace page on Dunderdon's site. At least four profiles are featured on the site at any one time.
- An online shopping basket that allowed for easy product navigation. Java Script was used to reduce production hours.
- A newsletter for current and potential customers that helps the company maintain a list of customer prospects. A centrally placed section of the site allows visitors to sign up for the newsletter.
- A blog written by a Portland humorist and illustrator. The blog features casual talk—even swear words—to appeal to a hip young U.S. audience. However, the blog hasn't been updated in months and is being changed.
The work.space section is the focus of the site, Szabo said. "We want to bring this brand to life, and the way you do it is you talk to the people who are doing the (line of) work that represents your product," he said. "It's all about raising awareness and possibly encouraging them (consumers) to stop in our New York store."
He describes the site as an "ongoing experiment" and notes that the blog and other less popular parts of the site are being refined.
Results:
Within six months of the site's re-launch, Dunderdon's US Web sales constituted 10% of the company's US sales; both the number of unique visitors and the number of visits to the site were up at least 30%; and sales at its US retail outlet in New York increased 15%.
Moreover, Dunderdon's unusual payment arrangement with its online marketing partner eROI was profiled in the Portland Business Journal on Oct. 2, 2006, giving it free publicity just two weeks after the site's re-launch.
Lessons Learned:
- Listen to your customers. Potential Dunderdon customers had been asking for a way to buy the products directly from the company via its Web site; when they were given that option, sales jumped.
- Recognize your limitations. Dunderdon is a small Swedish firm, and its officials didn't have their fingers on the pulse on the U.S. market and its fickle consumers. Had they tried to redesign the site internally, they likely would have failed. Instead, they hired a U.S. partner that specializes in building trendy communities.
- Consider an unconventional branding campaign, especially if you are a small, niche company. Print or radio ads for an unknown name such as Dunderdon's would likely have been ineffective. Building an online community open to embracing new brands proved to be a better strategy.
Related Links:
Note:
Five of Dunderdon's 13 employees are based in the US.
