Online retailer melds community, deep discounts
One deal, one day, limited supplies, and the promise of the
hottest electronics at a ridiculously low price. This description
might seem commonplace among the slew of
”
One deal a day
”
Web sites multiplying over the Internet. Daily Swag, Yugster,
Steep and Cheap, Catch of The Day, Deals Squared, to name a few,
are among the recent sites cropping up on the web. With an
estimated hundred sites out there, it is difficult to make a
distinction between the truly authentic and the overtly artificial
daily deal. But there is one site that started the craze more than
three years ago.
Online retailer melds community, deep discounts
One deal, one day, limited supplies, and the promise of the hottest electronics at a ridiculously low price. This description might seem commonplace among the slew of “One deal a day” Web sites multiplying over the Internet. Daily Swag, Yugster, Steep and Cheap, Catch of The Day, Deals Squared, to name a few, are among the recent sites cropping up on the web. With an estimated hundred sites out there, it is difficult to make a distinction between the truly authentic and the overtly artificial daily deal. But there is one site that started the craze more than three years ago.
Woot has gained credibility among bargain hunters. It is a relatively small company with an operating staff of fewer than 40 just outside of Dallas, Texas. The site was launched in July 2004 and offered a then-unheard of idea – sell a single item at a low price using edgy writing and pithy prose.
The reason the company is able to offer low prices is because they buy in bulk, Toon said, and as they grow they can purchase more quantities of higher end items.
Woot was the brainchild of electronic wholesale owner Matt Ruteledge, who had been in the electronic business since 1994 when in 2004 he had the idea to start a site where store and blog collide.
“Matt just had this crazy idea and had the vision to see how to do it” said 33-year-old Jason Toon, the communication editor for Woot.
Communication with commerce has been a true part of the company since the beginning with hundreds of customers logging in daily to post comments and discuss products.
The kitschy site describes each item – and one day last week a song played along with the item of the day – a Bag O’Crap. The bag sells for $1 and contains up to three items. While most of the items are just what the company staff says they are – crap – a lucky few get higher end electronics for their investment.
The premise of Woot is to take one item every 24-hour period, be it a desktop computer or a blender, and then offer it at a reduced price. The particular item is posted at midnight central time and stays on sale for one day or until supplies run out, which ever comes first. Whether purchasing a TV or a cell phone, a person can expect to pay $5 for shipping
“[What] a lot of people hate about online shopping is that they don’t know how much it is going to cost until they put in there credit card number in,” Toon said.
At Woot, the shipping is always the same and the price of the item is prominently displayed.
Depending on the item for sale, it can be a matter of hours or even minutes before it sells out, as was the case last December when the highly anticipated PS3 was put on sale. The Play Station was posted at midnight central time and the 80 units sold out in less than five minutes.
The fastest ever-recorded sell out time was a minute and a half to sell out 4,500 orders.
Toon said he was surprised with the company’s success. He started writing part time for the company not thinking much of it but then as things progressed he found himself writing full-time and to a large audience.
Woot has now grown to more than 700,000 registered users and on an average day receives 400,000 to 600,000 visitors. This is all done with little to no advertising, said Toon.
“It has been mostly word of mouth,” he said.
“Beyond the founding, the launch of the new Web site in July 2005 was pretty major, [and] vastly improved upon the older site,” Toon said, when asked about major events in the company’s history. “The older set up would not have been able to handle the traffic.”
For companies looking for feedback on a new product Woot offers a great platform. The social aspect of Woot, the blog, produces what Toon calls a fringe benefit.
“It’s a way to see what customers are saying,” Toon said. “It’s like a big focus group.”
Right now Woot staff is looking to expand operations. They recently developed a site called Woot wine – a deal on weekly wine – which launched early last year and they are currently working on more parallel sites for the future.
As for now, Woot regulars can expect to find daily deals on the latest piece of hardware along with Toon’s cleverly written product write-ups. To check out the site go to www.woot.com and for a weekly wine check out www.wine.woot.com.
