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Tech Industry

Cyberian readies for old-fashioned blocking and tackling

Cyberian Outpost's new chief executive Bob Bowman wants to begin practicing what he has been preaching.

Cyberian Outpost's new chief executive Bob Bowman wants to begin practicing what he has been preaching.

Bowman joined Outpost after tenure as chairman of privately held Icontact.com--an Internet firm that helps online ventures improve sales through Web-based interaction with clients.

"Now I get to try out my theories," said Bowman. "There is nothing more exciting than going from offering advice to having the gun at my head and having to do it."

Indeed, the trigger may even be cocked considering that the holiday shopping season is around the corner and competition is heating up among Amazon.com, Egghead.com, Beyond.com, and numerous others.

Bowman spoke to CNET News.com about how he hopes to turnaround Outpost's languishing stock and push the company toward profitability with some "old-fashioned blocking and tackling."

Q: What is your initial assessment of Outpost?
A: It's a great base, a great company, and a great group of people. But I think what we are lacking is some old-fashioned blocking and tackling. There are some obvious things that we need to get done and get them executed well--and this stock could really rocket.

Q: What kind of things?
A: Well, for instance, we don't face the customers on our Web site. If someone with 3.5 million unique visitors per month is not trying to engage the customers in some fashion on their Web site, that is a big mistake. We have to do that.

We do a great job taking care of the customers after they have placed an order or as they are placing an order--mainly telephonically. We have outstanding customer service, outstanding customer fulfillment. What we need to do a better job of is customer acquisition.

[As] people come to the site, we have to find out who is really likely to buy and encourage them to do so. I call this "customer facing." We have to do a much better job of customer facing on the site. It's not easy to do, but it is straightforward [and] takes some hard work…but it can be done.

Q: Do you foresee any major new strategic initiatives?
A: Outpost was almost exclusively a [business-to-consumer] stock and company, and they do it very well. But to ignore the [business-to-business or B2B] market would be a mistake.

The B2B market, both in terms of products and services, is not only huge but also growing explosively. We need to be a part of it. And I don't mean catering to the massive, huge companies of the world but to the 15- to 20-person professional groups that need many of the kinds of things we sell, both in terms of products and services.

Q: Do you think the Outpost brand needs any tinkering?
A: Outpost is a great brand. Darryl Peck [the company's founder] and his team did a great job creating a very hip, cool brand. But the branding needs to be burnished every day. I think the brand needs a little bit of a shot in the arm.

We don't want to spend marketing dollars foolishly but on the other hand, you have to spend some money to get the brand better known and really work on it. I think you are going to see a little more concentrated effort and a little bit more focused effort on our marketing dollars.

Q: Your retail sector is already quite crowded. How are you preparing to take on the competition?
A: The simple fact is that no matter what business you are in, you will have a lot of competition, whether it comes from Beyond.com, Buy.com, or Amazon.com. Whoever it is, there is going to be a lot of competition. Still, it's both good news and bad news. The good news is Amazon may create a buyer, or at least make someone interested in computers when they weren't before. These people may get to Outpost if they have heard about it from a friend or as they get more tech-savvy. What we find is that competition isn't always bad. Burger King puts its fast-food restaurants next to McDonald's for a reason.

What you can be if you are customer-centric and your customers have things in common, with technology you can be even more customer-centric…At that moment whoever is at your site, you can provide him or her with what they want which is really more than a product.

So you tip your hat to Amazon, but are they going to be able to sell all things to all people at the right price at the right time? The answer is 'no.' They just are not going to be able to do that, and they'll be the first to tell you that.

Are online retailers going to live up to the hype and expectations of the holiday shopping season?
A: I can't forecast what the economy is going to do, but assuming that the economy is basically where it is today in some sort of stable fashion, this will be an eye-opening holiday season for a lot of the so-called experts and analysts.

In terms of how many people who always just visited and who will be now willing to buy online, and how many more people are coming online in order to buy, it is going to be a phenomenal holiday season for everyone. For us, for Amazon, for everyone selling online.

The only issue will be whether it will live up to the levels that people expect it to be. There has been a lot of hype and big numbers strewn out there, and [whether it] will equal or exceed those numbers. I think for one that it will exceed those numbers that a lot of people are expecting.

Q: Is Wall Street's outlook on Internet companies that are bleeding red ink beginning to change?
A: Ultimately Wall Street, which is not doing it now, is going to start saying, 'We want to see how you are going to make money.' Even to the great names in the game, they are going to say: 'If you have to spend 100 percent of your revenues on markets, do you have a model that works?'

Ultimately the land grab, the gold rush, will be over. But right now it is still paramount for Outpost and others to keep trying to get customers. The growth is so huge, and I am not suggesting that profitability is going to come tomorrow.

Conversion rates are going to go from 1 percent to 2 percent to 3 percent. I think Outpost has a 1.3 percent conversion rate. If we got it to 2 percent conversion we would have 50 percent higher sales without spending anything. Is that possible? Not only is it possible it is absolutely mandatory in my view.