Can a small on­line busi­ness get big­ger and still main­tain its per­sonal ap­proach?

The Washington Post Sunday - - CAPITAL BUSINESS -

This week, an en­trepreneur weighs whether his de­sire to of­fer that per­sonal touch is get­ting in the way of ex­pan­sion.

— Dan Bey­ers

The en­trepreneur: Sam Feldman said he has al­ways had an en­tre­pre­neur­ial spirit. Though he’s still pur­su­ing his un­der­grad­u­ate de­gree, he’s al­ready work­ing on his third busi­ness ven­ture. His cur­rent project started just over a year ago, when he or­dered a bulk sup­ply of credit card sleeves to stick on the back of cell­phone cases. He put the com­bi­na­tion on­line, and they started sell­ing. Since De­cem­ber, the Col­lege Park en­trepreneur has sold more than 3,500 of his CardBuddy card hold­ers. “I didn’t re­ally have a master plan when I started out, but I saw this was start­ing to work, and I’m just try­ing to build it up as much as I can,” Feldman said.

The pitch, Feldman: “CardBuddy is a small card sleeve that holds one to three credit-card-sized cards. It sticks to the back of any phone or phone case. Users can eas­ily pull cards from the case and en­joy the con­ve­nience of only hav­ing to bring along their phone in­stead of a wal­let, too.

“We have two ‘mod­els’ cur­rently: The Orig­i­nal CardBuddy and our new CardBuddy Deluxe, made of leather and the only one like it on the mar­ket. Prices range from $8.99 to $25. I sell the first two mod­els on Ama­zon now, and I just in­tro­duced the new deluxe model on Kick­starter.

“The chal­lenge is scal­ing this from a small op­er­a­tion just sell­ing a prod­uct on­line to a larger re­tail busi­ness on­line and in stores. To grow the com­pany, I plan to launch my own Web site to sell the prod­ucts. I’d also like to ex­pand to of­fer it at more re­tail­ers. I need to think about mar­ket­ing. I want to do well in our Kick­starter cam­paign.

“Right now, I’m sell­ing 200 a week or so. With the help of a few friends, I’m pack­ag­ing all the or­ders, and Ama­zon is ful­fill­ing the or­ders. I try to make every­thing re­ally per­sonal and try to cre­ate a con­nec­tion with cus­tomers. I in­clude a note with each CardBuddy pur­chase that tells my story as a col­lege stu­dent who re­ally cares about qual­ity of the prod­ucts. I in­vite cus­tomers to e-mail me at my per­sonal e-mail ad­dress, and I per­son­ally hand sign each note. Cus­tomer sat­is­fac­tion is re­ally im­por­tant to me. I’ll al­ways stand be­hind my prod­ucts and of­fer a money-back guar­an­tee. How do I main­tain that com­mit­ment to cus­tomer ser­vice and of­fer­ing a per­sonal touch as I scale?”

The ad­vice, Elana Fine, man­ag­ing di­rec­tor of the Ding­man Cen­ter for En­trepreneur­ship at the Univer­sity of Mary­land’s Robert H. Smith School of Busi­ness:

“You need to de­cide if you are a cus­tomer ac­qui­si­tion com­pany or a cus­tomer loy­alty com­pany and fo­cus on that. If you think peo­ple will be buy­ing mul­ti­ple CardBuddy prod­ucts each year, you should spend time on things that cre­ate cus­tomer loy­alty. But if your goal is re­ally to sell one CardBuddy to as many peo­ple as pos­si­ble, then you should fo­cus more on cus­tomer ac­qui­si­tion. Of course you should still take re­turns and of­fer re­place­ments when nec­es­sary — that’s just good cus­tomer ser­vice. But per­sonal notes are be­yond what cus­tomers ex­pect if they buy a $10 prod­uct. That’s not a re­quired part of the cus­tomer re­la­tion­ship and not some­thing your cus­tomers likely care much about. They just want a good prod­uct.

“You can stay true to your val­ues of pro­vid­ing good cus­tomer ser­vice by mak­ing good on your prod­uct and of­fer­ing a qual­ity prod­uct with­out ex­pend­ing too many resources. Peo­ple will buy ad­di­tional CardBuddy prod­ucts be­cause they liked their first CardBuddy — not be­cause you send them a per­sonal note. In fact, in­clud­ing a note might hurt your im­age with some buy­ers who could per­ceive you as too small a com­pany if you have time to write per­sonal notes for ev­ery pur­chase.”

The re­ac­tion, Feldman: “There’s cer­tainly a bal­ance I need to strike here. I know that most cus­tomers don’t ex­pect this level of cus­tomer ser­vice, but I think that’s ex­actly what makes it so spe­cial. It’s a core part of CardBuddy’s iden­tity to of­fer an out­stand­ing ex­pe­ri­ence, and many of my Ama­zon re­views talk about great cus­tomer ser­vice and the per­sonal touch of each signed card. De­spite this, if the com­pany keeps grow­ing at this rate, then it soon won’t be pos­si­ble to hand sign each pack­ag­ing card.

“When this is no longer fea­si­ble, I will en­sure my cus­tomers are sat­is­fied by hir­ing a great team who can re­spond quickly to any cus­tomer con­cerns. The phone ac­ces­sory mar­ket doesn’t have much brand loy­alty, so any­thing CardBuddy can do to dif­fer­en­ti­ate it­self makes a pos­i­tive dif­fer­ence. I’m op­ti­mistic that the com­pany will con­tinue to grow, es­pe­cially with the launch of the CardBuddy Deluxe. When this hap­pens, it will be im­por­tant to keep of­fer­ing an ex­cel­lent cus­tomer ex­pe­ri­ence in a way that’s more ef­fi­cient than what I do now.”

COUR­TESY OF SAM FELDMAN

Sam Feldman, an en­trepreneur and a stu­dent at the Univer­sity of Mary­land, founded CardBuddy, a small on­line op­er­a­tion that sells credit card sleeves that stick to the back of your phone. He sells about 200 a week, he says, and in­cludes a hand-signed note with each pur­chase. Look­ing for some ad­vice on a new busi­ness or need help fix­ing an ex­ist­ing one? Cap­i­tal Busi­ness and the ex­perts at the Univer­sity of Mary­land’s Ding­man Cen­ter for En­trepreneur­ship at the Robert H. Smith School of Busi­ness are ready to as­sist. Con­tact us at cap­biznews@wash­post.com.

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