Amazon marketer reveals secrets to Kiwi piglet

By Aimee McClinchy

Friday 2nd June 2000

FLYINGPIGS: Adam Keller (left) and Stefan Preston

Local online retailer FlyingPig is turning more local customers into buyers than the legendary site Amazon does, new independent research shows.

FlyingPig has so far been cagey about releasing any financial information. But AC Nielsen's NetRatings, a subscription internet audience measurement service for media planners, site publishers and advertisers, shows the site is pulling in the punters.

The average number of pages accessed per person was 26, while in April FlyingPig had 22,220 unique visitors. It is ranked overall 54th in this country.

Amazon, in comparison, had 57,585 visitors with each person accessing 12 pages.

But NetRating's managing director Brian Milnes said the key distinction lay in the numbers of customers going on to make purchases - what is termed the conversion rate.

Of FlyingPig's customers, 23% went beyond the firewall to the buying side of the site while only 8% of Amazon's did the same.

Mr Milnes said site visitors could be going to Amazon to browse, read reviews and then buy from FlyingPig. Local customers were also showing high brand loyalty, with only 11,000 of the two companies' combined audiences purchasing from both.

The findings support the suggestion Amazon will use FlyingPig as its local arm.

FlyingPig is to merge with Australian e-tailer TheSpot, part-owned by Amazon, which played a key role in the negotiations to put together the deal.

A joint venture between Fairfax and Amazon, known as f2, will hold 20-25% of the merged company, with 65% to be split between FlyingPig's founders, Pacific Retail Group and Advantage.

Blue Star Group is likely to hang on to its subsidiary Whitcoulls' share and settle at 10%. Book chain Whitcoulls is up for sale.

But FlyingPig has not ruled out an "Amazonian" takeover or increase in shareholding as the US giant invites management over to Seattle and offers to share its software system and know-how.

"We don't know which way it will go," FlyingPig chief executive Adam Keller said. "They certainly haven't confirmed at this time what their strategy will be."

The NetRatings research on FlyingPig showed its loyalty from customers ranked higher than for Dstore, a large Australian online store. Dstore, which has a partnership with Rebel Sports, is to launch a New Zealand site in July.

TheSpot's market activity is not enough to even register on AC Nielsen's panel-based scale. But Mr Keller insisted TheSpot had been keeping a low profile as it attempted to get its service right - unlike DStore, which has spent millions on advertising.

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