E-Commerce Platform Helps Sneaker Brand Shoebacca Scale Growth
Founded in 2002 by brothers Marc and Robert Schlachter, Shoebacca's roots were as a wholesaler of athletic shoes. The pair was selling overstock inventory in local markets in their home state of Texas, as well as on eBay. After recording steady growth over several years, particularly as a reseller on eBay, the brothers decided that Shoebacca had a future as a standalone business selling direct to consumer via its own e-commerce website. So in 2007, the e-commerce site Shoebacca.com was launched on the Magento Commerce platform.
In addition to its own e-commerce site, Shoebacca looked at online marketplaces, including Amazon.com, Walmart, eBay, Jet.com, Rakuten, Overstock, as potential revenue sources for the brand. With the help of partner Magento, Shoebacca created an e-commerce system that could scale its growth, integrate its current systems, and sell customers the perfect sneaker wherever they start their journey, be it on its own site or a third-party marketplace.
"Marketplaces control a substantial segment of the [sneaker] market," notes Thomas Finney, director of information technology at Shoebacca. "We viewed them as a revenue opportunity and a channel for strong growth in brand awareness. Marketplaces now make up the lion's share of our sales — around 60 percent. In fact, Shoebacca is exclusive seller of some brands on certain platforms."
While Shoebacca's business was growing, so too was its complexity. Selling to consumers in multiple channels produced massive amounts of data, including product data, transactional data, returns data, shipping data, etc. The brand was intent on keeping the purchase experience, from discovery to delivery, consistent and seamless no matter where it took place, but that was becoming more difficult as it grew in scale.
To help address this challenge, Shoebacca upgraded to the Magento Commerce 2.3 platform. The new platform allowed Shoebacca to handle the large data processing required for its massive product catalog, including new fashion seasons and new sneaker designs. Furthermore, by connecting its back-end systems with multiple marketplaces and drop-ship service providers, Shoebacca was able to leverage the data to drive e-commerce growth. By offering their products on multiple channels, the brand is able to reach consumers wherever they prefer to shop.
"Migrating to the 2.3 platform has helped us stay ahead of the curve," Finney says. "Each channel has nuance. We funnel all of the data — transactional, returns, all cart data — into Magento, and treat every sale the same regardless of origin. For example, each channel has the same fulfillment process. Each channel is an extension of the Shoebacca brand."
For example, Shoebacca prides itself in exceeding the service-level agreements on each third-party marketplace it sells on. Finney says that the company's focus is on improving the customer experience for ordering and fulfillment. That is illustrated by the fact Shoebacca provides same-day shipping for about 85 percent of its product catalog if it's ordered before 2 p.m. CT. The company operates two distribution centers, one in Irving, Texas, the other in Nashville.
A Cart and Logistics Hub
For Shoebacca, the Magento Commerce 2.3 platform serves as the retailer's cart and logistics hub. The e-commerce platform enables Shoebacca to manage its entire operation, including inventory, pricing, accounting, shipping, CRM, and managing sales from multiple marketplaces, in a single location. In addition, Shoebacca is integrating its first-part data collected on its own website, such as product-level and geo-targeting data, with its third-party sales data to help personalize its customers’ shopping experiences.
"The platform acts as a central repository," says Finney. He added that Shoebacca's marketing team, in partnership with Emarsys, uses the data to help drive product recommendations, personalization on-site, email campaigns, and product associations, helping to increase conversion rates.
"Moving to the Magento Commerce Cloud has let us be able to scale quickly without large infrastructure investments," Finney notes.
He adds that the size and scope of the Magento community has been a tremendous asset for the small online retailer.
"Recommendations from the community have resulted in less development and planning on our end," says Finney. "There's a cost savings from less development. Also, we can get to market faster, which can be a revenue competitive advantage. We go out to the community for help with development."
Following its optimization with Amazon, Shoebacca received 1,800 orders in the first day alone. With a smoother experience for customers and for the company, Shoebacca saw sales and traffic increase by 25 percent. Furthermore, Shoebacca realized smaller customer acquisition costs.