Thought Leaders in E-Commerce: Darren Hill, CEO of WebLinc (Part 6)

Sramana Mitra: One question on Nasty Gal and the scalability point, what are the issues? What are we trying to solve?

Darren Hill: The issue is making sure the site is up. It works for all of your customers and they’re getting the environment that they’re expecting. For us, it’s really a technology play. Our systems are built on Ruby on Rails with a MongoDB database on the back-end. That technology allows us to rapidly scale in a virtual environment so that we can add new servers very easily. We can handle insane amounts of traffic almost seamlessly.

Sramana Mitra: Talk to me about pricing. I know the pricing of some of these other players that are serving much larger number of customers. You seem to be serving 100 customers that are much larger. I imagine your pricing is very different from theirs. Talk to me a bit about how you charge.

Darren Hill: There’s an implementation price, which is the cost of getting the system up and running and hooking it into their warehouses and into their ERP system. We also handle the graphic design. The initial implementation price is somewhere between $200,000 to $250,000. That typically takes about six months. Once they’re up and running, it’s a subscription model. It starts at $10,000 a month and goes up from there, based on the amount of traffic the client gets.

Sramana Mitra: Increase to what level? What is your largest client and how much are you charging them? What is the range?

Darren Hill: It usually caps out at about $45,000 a month. In that, we’re handling all of the technology. We’re doing all of the upgrades. Security is a big issue these days. Any new features and functions are automatically going into the system.

Sramana Mitra: It’s not just the platform, but you’re providing all the services of keeping the site running as well.

Darren Hill: Correct.

Sramana Mitra: It’s SaaS plus actual manual service on top of it.

Darren Hill: Yes.

Sramana Mitra: Let’s go to the next segment. You have a particularly interesting perspective working with all these retailers companies that are doing significant traffic on their site. What trends do you see currently? If you extrapolate further the personalization story, where does it go? What kinds of use cases and scenarios can we expect to see? What other trends are you projecting?

Darren Hill: Personalization is interesting. I just want to stress that we’re getting wildly beyond just the, “You might also like this.” The new versions of the WebLinc system will literally be a completely new merchandise site including navigation. That’s a big one. The complexity there is, it has to work on mobile. Typically for a lot of our clients, they’re getting more traffic on mobile than they’re getting on a desktop interface. With mobile, it’s a much different approach. People are obviously not able to shop in that grid model. Searching is much more important. Very direct navigation is much more important. Personalization is much more important—helping the person find that product much faster than having to browse. People will browse on their phone but they tend to not want to do it that much. For us, if it’s a customer who’s already been to the site once, being able to show them specific products that’s within their interest is critically important over the phone and much more so than over the desktop.

This segment is part 6 in the series : Thought Leaders in E-Commerce: Darren Hill, CEO of WebLinc
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