Chan Stimart, president of Channie’s LLC, a 4-year-old company she founded, says back-to-school sales are surging for her small, mostly online business that sells workbooks designed to improve children’s handwriting and math skills
Sales began increasing in March as parents sought to instruct their children while schools were closed, she says. From February to March, sales grew 400%, Stimart says. And year-to date as of early August, sales are up 250% compared with the same period in 2019, she says. This includes sales on its direct-to-consumer website Channies.com, which accounts for about 15% of company sales as well as sales at websites of other online merchants such as Target Corp. and on Amazon.com Inc. It also includes a small amount of sales Channie’s generates in some physical stores, such as Mardel’s, which is owned by Hobby Lobby. 95% of Channie’s sales are online, Stimart says. Target is No. 12 in the 2020 Digital Commerce 360 Top 1000, and Amazon is No. 1.
Sales spike for Channie’s
“We normally see sales spike July through September about 20-30%, but we’re seeing way more this year,” Stimart says. Last year was the retailer’s third year in business and it generated $880,000 in sales in 2019. This year it anticipates making nearly $3 million, she says. No small feat for a company run by “four moms working part-time.”
Before the coronavirus forced many parents to work from home while also teach their children remotely, Channie’s target audience was parents who homeschooled their children full time. But this year, the retailer is working to attract multitasking parents with products that are designed to help children learn on their own, such as self-guided letter tracing. For example, its one-page-a-day products are designed for children to complete a single page of exercises on their own and are quick and easy for parents to grade, she says.
The number of products per order is increasing as the school season approaches as many parents are gearing up for long-term remote learning. Before, most orders only included one item, but now the average is three or four products.
Channie’s also began selling more kits since the pandemic hit. These bundles include handwriting and math, blank workbooks, flashcards and more all offered in a single kit so that shoppers don’t need to “search through 60 products and can just get one kit to cover all their bases,” she says.
Attracting new customers
Stimart is thinking strategically about how to gain new customers and grow her business long-term at a time when her products are especially popular. For example, Channie’s is running more sales to attract new shoppers. Sales typically bring in 20% more revenue than days when it isn’t offering discounts, she says. “We want new customers now,” she says. “Then, we hope they will come back for their other kids. We are focusing on exposure and bringing in more awareness.”
Generating a steady stream of new shoppers is important because as children master basic math and handwriting, they no longer need Channie’s products, she says. The retailer’s typical customer mix is 80% new shoppers and 20% repeat customers.
While Channie’s sells on Amazon.com, Stimart is investing in bringing more customers directly to Channies.com to buy. “We just hired a company to get social media and word of mouth going more,” she says.
Amazon accounts for a big part of its sales, and it has helped the retailer grow sales rapidly. But Channie’s also suffered when Amazon stopped accepting nonessential merchandise into Fulfillment By Amazon warehouses in April so that it could handle surging demand for cleaning and health-related products.
Channie’s sales were surging as parents sought to instruct their children while schools were closed during this time, but FBA would not accept her products, Stimart says. “Even though we had tons of inventory, we couldn’t sell it,” she says. “That made me realize how much we are at Amazon’s mercy.”
Stimart reacted by fulfilling orders from her garage until she could hire a logistics company to handle her Amazon orders. That allowed Channie’s products to ship free to Amazon Prime members, even though Channie’s was not doing those through FBA.
Channie’s Amazon approach
Channie’s plans to continue to invest about $20,000 per month in advertising on Amazon to promote its products. But the retailer is also planning to continue to invest in Google advertising to drive more traffic to Channies.com, recognizing that not all consumers shop on Amazon and that Amazon prevents it from remarketing to customers who buy its products on Amazon.com.
“Amazon made us, but Amazon also has lots of control,” she says.
According to a survey from deals site and coupon aggregator RetailMeNot.com, 80% of retailers say Amazon remains a top competitor for the back-to-school season. 70% say they worry that their organization will struggle to meet financial goals with Amazon Prime week being pushed outside of the back-to-school season this year. Additionally, 40% of brands say they are offering more free shipping options this year to compete with Amazon, and 47% will offer price-matching across channels. RetailMeNot surveyed 1,041 consumers April 27-May 1 and 206 retailers and businesses April 16-April 23 for its findings.
That research also finds:
- 56% of consumers say they will be more inclined to shop online for back-to-school items this year because of pandemic concerns.
- 52% of parents interviewed say they plan to use curbside options for back to school, up from 36% last year.
- 52% of consumers say buy online pick up in store is a convenient way to receive back-to-school items.
- 72% of retailers say they plan to offer more curbside pickup options this back-to-school season than they did last year.
- 59% of consumers say they search websites and apps for back-to-school purchases, 37% look at social media, 35% deal sites and apps, 34% browser extensions and 31% cashback websites and apps.
Don Davis contributed to this storyFavorite