Brian Wiegand is no stranger to start-ups. His first business, BizFilings, launched in 1996 from his basement and later sold for $15 million to a public company.
He and business partner Mark McGuire went on to start two others. The most recent was Jellyfish.com, which caught the purchasing eye of Microsoft only 18 months after its inception.
The two could have stayed after the sale, but decided corporate life wasn’t for them.
Now the duo has launched their fourth online company, Alice.com, an online service in the consumer packaged goods industry. The site connects manufacturers directly to consumers, bypassing large retailers such as Wal-Mart and Target.
Q: What made you want to delve into the tough consumer packaged goods industry?
Wiegand: We sat and thought about what else we could do, and we really looked at the consumer packaged goods space. When you really look at this, you find no one’s buying these goods online. Why? Everything else is going crazy; Amazon.com sells all kinds of things. These other online categories are growing, so why isn’t the household supplies market? The No. 1 reason is shipping. It actually costs more to ship a tube of toothpaste than it does for the actual product. Online prices are 30 and 40 percent higher than some of the mass retailers, plus you have to pay for shipping. We’ve created a model where we always offer free shipping with prices similar to the existing prices of, let’s say, a Target or a Wal-Mart.
Q: How do you make this shipping model cost effective on your end?
McGuire: All of this is centralized in one warehouse, and we pick, pack and ship everything. It’s not like Amazon’s model that ships bulk of these products to the consumer who gets a different box from each different manufacturer. Our model packs everything in one box.
Q: Other than jumping into a previously undeveloped online market, what else sets Alice.com apart from other e-commerce sites?
Wiegand: The “secret sauce” is that we’ve created a planning subscription service here. The use of [these products] is a repetitive type of pattern, so we’ve created more of a Netflix-style service. When you add paper towels to your virtual shelf, you’re actually adding a reminder and can set the re-order frequency. The site gets smarter as you order, and it knows what you use. This reminder set of tools is all drag-and-drop. We’ve created a price comparison, so if you click “check prices,” it shows you the prices at Walgreens, CVS, Target and Amazon. Then when you add a product, it goes into your personal shelf. When you want to check out, you just drag them into your cart. We’ve entered a number of Quicken-like tools to show you on a month-by-month basis how much you’re spending. We’ve taken all the coupons in the entire country and uploaded them here–they’re automatically applied–so you never have to get the scissors out. It’s very green.
Continue Reading: “Go Ask Alice…”
Photo by Alice.com.
