Q&A: eBags’ Peter Cobb Explains Secrets to His Company's Record-Breaking Success

eBags, the online bags retailer, recently launched behaviorally targeted emails and an aggressive search engine optimization campaign — as well as offering 30 percent off and free shipping for purchases over $100 on Cyber Monday — to celebrate the kickoff of the holiday shopping season. The results speak for themselves: eBags enjoyed record-breaking sales this past Thanksgiving weekend.

Thanksgiving Day saw sales up 56 percent from the previous year; Black Friday set an eBags all-time record with a sales increase of 76 percent vs. 2009; and Saturday and Sunday saw increases of 77 percent and 57 percent, respectively. Black Friday's one-day sales record was short lived, however, as Cyber Monday's sales total took that honor, with sales up 54.3 percent from last year.

To find the secret to eBags’ success, Retail Online Integration spoke with Peter Cobb, co-founder and senior vice president of the online bag retailer.

ROI: This was a record-breaking year for eBags in terms of sales. To what do you attribute your success?
Peter Cobb: This holiday we're seeing a mass migration from brick-and-mortar to online. People are seeing "Doors opening at 2 a.m.," and I think they're realizing, "I don't have to do that. I can shop at home 24 hours a day online." There's really a gaming aspect to retail these days that seems to be resonating with people. If you don't get in and purchase, it's going to be gone. Consumers understand that and realize, "I need to buy it today because it may not be there tomorrow." Our Cyber Monday deal certainly won't be there tomorrow.

I also think consumers have a little bit more confidence this year in making purchases...a little bit of retail therapy. They've been pent up for so long that they want to get out and spend a little, especially if they feel like they're winning in this tug of war between the customer and the retailer.

We also had some great deals out there for consumers. We negotiated with all of our 550 brands and said, "Let's not wait until the traditional period of Dec. 26, when you start giving us products that are on sale so that we can run inline with the traditional big-box department stores’ white sales in January. Let's play it differently. Let's have sales when shoppers are in our online stores."

One by one, the brands said, "I'm with you. It's been a challenging year, let's go for it." So they moved their sales up for us. That allowed us to go on sale with a lot of products starting Thanksgiving, which typically wouldn't be on sale until Dec. 26. That's a huge offering.

ROI: What recent campaigns contributed to eBags record sales, and why?
PC: The nicest thing about our five-day, 63 percent average increase stemmed from the two fastest growing marketing channels — SEO and email— and they're both free. The fastest growing marketing channels being the ones that have no cost is what you want to see. We didn't have to do TV ads or expensive marketing campaigns to drive our sales growth. It came organically.

From a marketing standpoint, we've put a lot of effort into keyword buying — trying to get more effective at keyword buying, and not just throwing money at keywords. We have a homegrown solution that we use for managing keywords. There's always potential for dollar leakage in putting money behind keywords that may not be working.

ROI: Anything you can improve for next year?
PC: There are always things that you look at. It's like homeowners looking at their kitchens. It looks perfectly fine to the outside eye, but if they live with it everyday you know there are some issues. We understand that consumers are impatient and want to have as few clicks as possible to find the perfect bag. That purchase funnel needs to continue to shrink.

ROI: Any best practices our readers can take away for their 2011 marketing programs based on your success?
PC: If you've got a killer deal, bring it forward. In some cases, create a killer deal or doorbuster. They're resonating with people. Craft offers and value-oriented deals that will draw consumers in and get them to purchase. They understand value. Don't try and push a dog, cause if it's a dog the other 11 months of the year, it's still going to be a dog during the holidays.