The Activskin Story - II

by Steve K

Here Steve Katz of Activskin.com continues his personal story. You can read Part 1 here.

Next we began some online market research. We compiled a list of survey questions to ask. Then we posted the survey on several web sites that promoted legwear for men. The survey was very long - eight typed pages - and we asked dozens of questions about men's hosiery wearing preferences. One webmaster said he would post the survey on his site, but because it was so long, we wouldn't get many replies. He was wrong. We got 250 responses back in under two weeks, which we thought was outstanding! We compiled the data and had a good idea of where to start our business. The only things we didn't have were quantitative data and products. We went to a market research firm at our local mall and told them we wanted to survey single adult male customers in the mall (we figured that we wouldn't get honest answers from men accompanied by others). So we got data from 100 customer encounters (all we could afford - this was expensive!) and decided the results were good enough to go forward, even though the number of men who admitted ever wearing women's tights was very small. Still, it wasn't zero.

We interviewed by phone several suppliers of women's hosiery to see what their interest in men's legwear would be. This was in 1998 and the women's sheer legwear market had been shrinking for six years already. Still all of the inquiries yielded no interest. Apparently they knew that the numbers were very small (for them) and that they didn't want to jeopardize their women customers' loyalty by making products for men. At last in October 1998 we found one company in North Carolina willing to give us an audience. So my wife and I drove down there to make a presentation. We were greeted by the company's VP, and the first thing he told us was that he only had 30 minutes as he had to get to another of the company's mills. We were disappointed because we had driven all that way and this was just going to be a courtesy meeting and then they'd tell us good-bye. We began our presentation, showed them all the market data, impressed them with our work to date, and two hours later we were still in the meeting and the VP had cancelled his plans to visit the other mill (if he ever actually had plans - it might just have been an excuse). This company was excited about what we had to offer and they could see we had done our homework seriously. We worked with them for the next six months to develop our first products for opening day in late April and we're still with them 7 years later.

While in North Carolina, we visited the National Association of Hosiery Manufacturers, now called The Hosiery Association. The president of the organization was gracious to give us his time and told us he knew there was a small but viable men's market because they got calls all the time from men wanting to know if anyone made or sold tights for men. He was very supportive and answered all our questions. We joined the organization on the spot, as the dues were affordable and we felt we had access to a good resource.

The last ingredient before getting into business was creating a web site. We wanted to be an e-commerce company from the start, because we knew that with a small, dispersed market, there would not be enough concentration in any one geographic location to warrant a store. Stores don't want to invest in inventory that sits on the shelf and sells slowly (or not at all). Nor do they want to invest in lots of different stockkeeping units (SKUs), which are style-size-color combinations. Our first offering was simply two styles in 3 sizes and 2 colors. We expanded from there and today we offer 23 different styles in a couple of hundred SKUs. But back to the web site.

We were totally ignorant of web site development and didn't know HTTP from HTML. We found a local ad agency which had a web site guru who knew all the tricks. The artistry and the shopping cart functionality came together over the next few months, from December of 1998 to April of 1999, when we went live. The first site was crude but it worked. We learned how to download orders, process credit cards, print mailing labels, package orders, take them for mailing, handle returns, etc. We budgeted for returns to be about 5% of sales. We were elated that they were less than 1%! In addition to the web site, the ad agency also created a package design for us.

Soon after opening the business, we realized that it was going to take more than one person's effort to run it. We hired a local college student who was computer savvy to help. He downloaded the previous day's orders from the web site (all encrypted of course), learned how to fill and mail out orders, helped with a myriad of other tasks, acted as a hosiery model for photographs when needed, and went to the shop around the corner to get us ice cream in order to survive that first long hot summer!

So that's how we got started.

Part 1