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Thursday, Mar 28, 2024

Feed an E-tailer

The growth in e-commerce websites has created a need for support services. That is where Feedonomics comes in – the Woodland Hills company can be described as a conduit between retailers and online price comparison websites such as Google Shopping as well as marketplaces like Amazon.com Inc. and eBay Inc. Chief Executive Shawn Lipman said the company manages and optimizes product data so client’s products will appear in relevant searches so that shoppers can click to make purchases. “We are a significant enabler in terms of a company’s validity to get their products in all these different marketing channels and increase their sales,” Lipman said. Brothers Brian and Robert Roizen founded Feedonomics in 2013 and Lipman, a South African native, joined the company the following year. It took until 2015 for the company to produce any revenue – $300 in one month. This year it is expected to boost sales by more than 250 percent with a workforce of nearly 50 employees. Feedonomics moved to its offices in the Warner Center earlier this year. Although the company is a relative newcomer to the e-commerce market, its timing is right as shoppers migrate away from brick-and-mortar stores and make more purchases online. A report by Cambridge, Mass.-based Forrester Research Inc. in April forecast that U.S. online retail sales will reach $446 billion this year and go up to $648 billion by 2021. The report found that the largest and fastest-growing product categories people shop in include consumer electronics, event tickets and car parts. To have an engine that facilitates that process is an amazing place to be, Lipman said. In tech terminology, his company provides a “product feed,” or list of products with accompanying data and images – hence the name Feedonomics. While physical retail isn’t dying, it is shrinking as more people default to do price comparisons and discover new products on their smart phones, tablets or laptops, the company’s Brian Roizen said. “You can do it from the comfort of your couch,” he added. “Which is a huge boon to us because we are the ones getting products from all these online stores to hundreds of different advertising channels, affiliate channels and marketplaces.” Alan Trzuskoski, a director with FitForCommerce, a New Jersey-based consulting firm for e-commerce and omnichannel businesses, said that feed platforms are crucial for online retailers because they simplify and accelerate data syndication, the lifeblood of the internet. At his boutique firm, the staff has seen how feed management is a competitive advantage for online retailers because it allows control of channel sales and online advertising. “The most valuable feed platforms incorporate enterprise-wide data when optimizing a feed for a specific channel,” Trzuskoski said. “This often includes margin, cost of advertising, user behavior on the website and insight from the purchasing department.” Bootstrap years For its first two years, Feedonomics was a bootstrap operation with little to no revenue until about 2015. Lipman said the company was now profitable and money is reinvested back into the business. He noted that the company has access to private capital, but he doesn’t want to tap it so that Feedonomics remains a disciplined company when it comes to finances. If there is an excess of funds, a company can lose that disciplined edge and then spend too much, he explained. The cost for the Feedonomics service starts at $200 a month. The company has a month-to-month model rather than having clients make long-term commitments. “We find that it forces us to prove our value every single day,” Brian Roizen said. In addition to the software on the backend, the company provides at no extra charge full-service functions that a client would otherwise have to do themselves. These include collecting data into the platform, mapping and querying the data, looking at quality of the data and establishing the rules that transforms the data so it can be optimized for each the marketing channels. “All the people you see here are doing that on a daily basis for our clients,” Lipman said of the staffers sitting at their computers. Marv Ahlstrom handles marketing at HD Supply Inc., an Atlanta business-to-business supplier of maintenance and repair products, with a website of 7,000 items doing $1.2 billion in online sales a year. When he wanted to go to the next level with online advertising, Ahlstrom brought on Feedonomics to handle selection of the right keywords on Google and getting HD Supply products listed on Google Shopping. Ahlstrom soon realized that what Feedonomics was doing was applicable to other websites just tweaking the data. “With a couple of changes, Feedonomics was able to push out data to other vendors that were integrated into our site so we could implement those as well,” he said. In developing its feed management software, the Roizen brothers built a scalable system that could apply to large retailers found in shopping malls or to smaller outlets that may offer only 10 products. A team of 40 analysts put in nouns and adjectives that help in optimizing a client’s products, which means they are as relevant as possible when someone does a search online, Brian Roizen said. “We make sure that the way users structure their searches is the same way that the product titles are structured,” he added. ‘Legacy’ culture While Feedonomics is a technology company, Lipman said the executive team looks at it as a people-centric enterprise. To that end, they have built up a strong culture that borrows from principles set out in “Legacy,” a book about the winningest sports team in history, the New Zealand national rugby union team. Commonly known as the All Blacks due to the color of its uniform, the rugby team in more than 100 years has lost to only six of the 19 nations they have played in test matches, giving it a 77 percent winning percentage. The principles outlined in the book include never being too big to do the small things that need to be done; when you find yourself at the top of your game, change your game; create a learning environment; select people based on character over talent; and find something you would die for and give your life to it. All employees are given a copy of “Legacy,” and the book is discussed around the office, said Lipman, who is a rugby player himself who played for South African and U.S. teams. “To a large extent I think that has been a part of our success,” he said. The work that Feedonomics does is a perfect fit for people who like data, analytics and math and attracts smart individuals who are just starting out their career. For many of the employees, it is the first company they work for after graduating college, Lipman said. In addition to UCLA, where the Roizen brothers went to school, Feedonomics draws graduates from USC, California State University – Northridge, Pierce College and Santa Monica College. “It is awesome that we have these amazing resources so close by that we can recruit from,” Brian Roizen said. Regardless of how long an employee stays, Lipman said the company leaders want it to be an educational experience. That is a purpose of the “Legacy” principles so that they can help an employee even if they go work elsewhere, he added. The executives, too, act as mentors to the younger colleagues and talk with them about whether Feedonomics is the right place for them or if there is another career path they may want to follow. If it is the latter, they are willing to help out with that just as much as if they want to stay with the company. “It is the concept of paying it forward,” Lipman said. “We want to make sure that anyone who comes to work for this company, whether it is for a short time or long time, will see this as being a special, defining period of time in their career.”

Mark Madler
Mark Madler
Mark R. Madler covers aviation & aerospace, manufacturing, technology, automotive & transportation, media & entertainment and the Antelope Valley. He joined the company in February 2006. Madler previously worked as a reporter for the Burbank Leader. Before that, he was a reporter for the City News Bureau of Chicago and several daily newspapers in the suburban Chicago area. He has a bachelor’s of science degree in journalism from the University of Illinois, Urbana-Champaign.

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