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NEW YORK — On the heels of Walgreens’ completion of the acquisition of Drugstore.com, at a total enterprise value of $409 million, another e-commerce health and beauty company is hoping to rocket into the spotlight.
This story first appeared in the June 10, 2011 issue of WWD. Subscribe Today.
Stockn’Go, or Stockngo.com, which was launched late last year, fuses convenience with warehouse-style prices and aims to become a “go-to” source for the growing ranks of consumers opting to buy health and beauty products online.
“We’re like Costco and Overstock.com combined,” said Adam Berkowitz, who co-founded the company with Jonathan Webb. The team had worked on e-commerce sites for Giorgio Armani, Perfumania, Revlon and Elizabeth Arden before deciding to create its own. He said Stockn’Go is already outpacing original sales plans by threefold.
Rapid expansion of Stockn’Go comes at what many experts believe is a turning point for online shopping. Consumers are warming up to the idea of ordering even fragrances or cosmetics via the Internet, especially thanks to money-back guarantees. Some research shows more than 50 percent of consumers buying at least some items online and 85 percent are said to research products via the Web.
Even manufacturers see the need to boost online sales with Procter & Gamble Co. and others looking to raise online sales to as much as 10 percent of total volume in the next few years.
Currently Stockn’Go has more than 5,000 stockkeeping units with plans for 10,000 by year’s end. Brands range from high-end lines, such as Chi hair styling tools, to value-priced items, including VO5 shampoo. Bulk sales are a big part of the business and even independent drugstores and other retailers order from the site. There is a customized account program allowing for reoccurring deliveries based on daily, weekly or monthly needs.
Currently, hair care is the biggest seller on the site and Stockn’Go especially serves those in markets within middle America where it can be hard to procure some brands. “We have customers who can’t easily buy, say, John Frieda,” said Berkowitz. The e-retailer will soon add as many as 400 styling tools, another big category not always readily available at retail. Currently, average orders ring in around $50 — twice that of what is required for free shipping.
To date, social media and word of mouth is the main marketing tool — there are more than 13,000 followers on Twitter. Berkowitz doesn’t rule out, however, the idea of a pop-up store to help introduce the name to more consumers.