BY POPULAR DEMAND
IT’S GOTTEN TO the point where customers are telling their suppliers they’ve got to jump on the electronic commerce bandwagon-and not the other way around.
That’s the premise under which Airgas-a distributor and direct marketer of industrial gases-has launched its online marketing venture. In late February, the $1.5 billion company converted its two-year-old text-only Web site (www.airgas.com) into a commercial venue to supplement its outbound telemarketing, catalog and sales force efforts.
“Our whole initiative is driven by our customers who want electronic commerce because it’s easier and more efficient,” says senior vice president/ chief information officer Sandy Goldstein. “The average order that currently costs a customer $20 to $50 now can cost as little as $3 to $5 because of reduced back-end costs.”
Airgas’ 750,000-plus customers range from Fortune 1000 companies, universities and medical laboratories, down to small metal fabrication and welding shops of fewer than 100 employees. In addition, many of the larger customers have multiple buying locations, notes Goldstein.
At first, Airgas-which also sells welding equipment and tools-will accept payments from existing customers via electronic fund transfer arrangements. Later this spring, the company will start accepting credit card orders after it launches its consumer-oriented Web site.
As part of its overall electronic commerce strategy, Airgas has established a database marketing support structure that will allow it to learn from customer transactions (simplifying repeat ordering) and notify customers when new information becomes available.
Airgas is also looking to find ways to take advantage of its more than 700 U.S. locations to expedite order fulfillment and direct delivery. Local service will continue, while customers get the benefit of tapping into a national inventory.
Within a few months Airgas intends to begin testing several customized online systems with sample customers. When these systems have been fully developed and tested, they will be integrated into Airgas’ online set-up.
Will the company follow the model of so many Web marketers and take losses on online sales in order to build market share?
In a way. Goldstein says Airgas isn’t too concerned about profitability here since it plans to plow back all online revenue into further e-commerce development.
