Michael's brother Abraham started the company in 1994 with a catalog and about 70 SKUs. Michael joined him two years later. Now, they have 15-20 employees (depending on the season), carry 3,500 SKUs, and sell from both their catalog and a Yahoo! Merchant Solutions web site.

Learning Through Trial and Error
The Ades brothers haven't found success with everything they've tried, but they haven't let that stop them from constantly trying new things. Through persistence and careful tracking, they consistently improve their business, marketing, and rate of return.

Take their web site, for example. Because they started the catalog business in the mid-1990s, they wanted to build a web site right away. It's what all the catalog businesses were doing, so the Ades' knew they needed a web site to stay competitive. "We originally built our main site on a different platform, and used Yahoo! Merchant Solutions as an additional store," says Michael. "We decided to switch full force to the Yahoo! platform in 1998."

Yahoo! Merchant Solutions fit the bill because of how simple it is to get up and running. "Originally, we didn't have the HTML skills to be able to build a web site from scratch," says Michael. "As we progressed in our web knowledge, Yahoo! has progressed as well, adding on new features and customizations." For Ades, the best thing about Yahoo! Merchant Solutions is dependability. "It's incredibly rare that there's any downtime," he says. And, he and his employees can all update the site quickly and easily.

Yahoo!'s flexibility helps keep the Heavenly Treasures site looking stylish and current, like the jewelry they sell. "Every season we'll do a small change to the site to keep up with the seasons. We've done full redesigns every two years or so."

Finding the Right Marketing Mix
Trial and error has also helped the Ades brothers find the right mix of marketing techniques to build a loyal and growing customer base. Now they rely on a newsletter, search engine placement, banner ads, direct mail, and an affiliate program.

Ades says tracking is of the utmost importance in all the programs. "We had some failed advertising campaigns at first. Because we didn't track them, we really had no idea why they failed. Now, we've gotten much more sophisticated with the tracking we do. We're especially careful with web marketing. We always get references from other companies when we try a new company."

Newsletter
Because of all the issues with spam, Ades says the only email marketing they do anymore is through their own newsletter. They use IntelliContact to manage the newsletter, which they send every two weeks. Heavenly Treasures ask customers to subscribe to the newsletter during the checkout process, and provides a sign-up box on every page of the web site. In addition, the print catalog directs people to the web site to subscribe. The newsletter generates sales from current customers on the mailing list, customers who signed up for the newsletter but have never purchased before, and entirely new customers who get the newsletter from current customers.

Search engines
The Ades brothers also make sure their web site shows up on search engines: both pay-for-performance engines and non-pay-for-performance engines that require hand submission. Both have delivered sales, but the pay-for-performance engines offer the advantage of tracking tools. Heavenly Treasures purchases both Overture and Google keywords.

Banner ads
Through trial and error, Heavenly Treasures has found success using banner ads. Some of their early "failed" campaigns were expensive banner ads that didn't deliver results. Nowadays, they're much more careful, especially when trying out a new ad placement service. Ades recommends always asking for references to learn whether or not other advertisers have seen results, and cautions, "Banner ads can work, but you have to get the right price, and you have to get tracking, so you can see right away if they're working or not."

Pop-up ads
"We used to run pop-up ads, but we stopped. People don't like them, and they weren't selling anything for us," says Michael.

Direct mail
Since the company started with a direct mail catalog, the Ades brothers have also used direct mail marketing to boost their sales. They print and send postcards to advertise new items, spread the word about special offers and promotions, or just tempt their regular customers with the latest trends.

Again, Michael attests, they've honed their direct marketing with trial and error. "We started out with a book on direct marketing." Once they understood the basic strategies and what kind of results they could expect, they priced different vendors, asked for references, and made their decisions based on all the information they'd gathered. These days, they're working with reliable, affordable printers and mail houses to do the printing and distribution.

Affiliate Program
Heavenly Treasures has an affiliate program-a network of "affiliate" web sites that provide a link to Heavenly Treasures in exchange for a commission on the sales they deliver. They pay an outside vendor to manage the program. "The affiliate program definitely brings in orders, but you do have to put work into it to get it to work," says Michael.

Keeping Your Customers Happy
Not only has Heavenly Treasures been creative and persistent with marketing to get new customers, but they go out of their way to keep the ones they have happy-and coming back for more. "Customer service has a tremendous impact on sales and customer retention," says Ades. "Returning customers are a big part of our business. We've had many of our customers for years."

How do they do it? In addition to their newsletter and direct mail marketing, the Ades brothers have the customer-service basics down pat. They keep their web site up to date, offer gift certificates, and keep good records-that always come in handy when handling delivery issues and returns-using Order Manager (by Stone Edge Technologies, Inc.), and a customized version of Microsoft Access software. "Yahoo! integrates really well with the software we use to run the business. The export features it has make it easy to export web orders from the site and bring them into our order-management system with the export features that they have."

On top of that, Heavenly Treasures offers a 30-day, money-back guarantee, issues refunds for items that are damaged (and replaces them with express delivery), and will special order items on request. If an item is backordered and a customer has been waiting for a long time, Heavenly Treasures will express ship the item free of charge.

To help new customers feel more secure, Heavenly Treasures features the logos of the associations they're affiliated with, including the Direct Marketing Association, Jewelers Board of Trade, and Jewelers Vigilance Committee.

Staying Competitive The biggest business challenges they face, aside from finding new customers, are competition and keeping up with the fashions in jewelry.

"To stay competitive," Michael says, "we're constantly looking around, checking out our competition, and attending jewelry shows to make sure we know what's in style, what's out, and what the new trends might be. We also solicit feedback from our customers about what they want, and what they've seen other places. We'll make a special order for one customer, but if lots of folks start requesting the same thing, we'll add it to our inventory."

Using a similar approach as he does with marketing, Ades discontinue items that aren't selling anymore so he can focus on his most profitable merchandise.

Taking advantage of different media
The Ades brothers know that each different medium they use to sell products has its own strengths and weaknesses. By using both a catalog and a web site, they get the best of both worlds.

For example, in their catalog, there's limited space to describe each item. On their web site, they have as much room as they need. So, the catalog descriptions now direct customers to the web site for more detailed information.

Knowing your business
Most small business owners can tell you how seasons affect their sales and probably toss in a couple of colorful stories to boot. "We cut back in the slow season, and ramp up for the busy season," Michael says." That includes marketing campaigns, inventory, and employees."

But again, the Ades brothers give themselves an edge by applying the same thinking and dedication they use to tracking their marketing campaigns to tracking their annual sales. With the information they gather, they can compare their sales week over week, month over month, and year over year.

When you track your actual sales data, instead of relying on memorable moments and customer stories, chances are you'll see patterns-and be able to prepare for them-sooner. In the long run, that preparation will save you money.

Believing in your business
Michael Ades says he didn't start to feel really successful until about five years ago-five years after they started-but the one thing he says he'd do differently if starting over again might surprise you. "I'd go in stronger from the start," he says. "I'd try to get more funding so I could start bigger instead of working up to it slowly."

Related Links
Heavenly Treasures
Yahoo! Merchant Solutions
IntelliContact
Overture
Google
Order Manager by Stone Edge Technologies, Inc.
Exporting Orders in Merchant Solutions

Here are several different methods for measuring your success:

• Web site analytics. Your own web site traffic logs provide a wealth of information about how your marketing programs are performing. For example, referrer reports tell you what sites your visitors have come from on the way to your web site or store, and which sites are generating the most traffic for your business.

  Deeper web site traffic analysis can help you measure how long visitors stay on your web site, how quickly they make a purchase, or how many sales are generated through different referring sites, such as your search advertising partners. These conversion rates help you measure the value of your referrals from other web sites. You may learn, for example, that one site generates a high volume of referrals but delivers a very low conversion rate, while another site generates less volume but more qualified leads who convert to paying customers. You may realize that the smaller, more-qualified traffic is a better investment and shift your marketing dollars accordingly.

• Email statistics. You can measure the success of your email programs using different metrics, including the following:
  
  • Open rates are a measure of how many recipients opened your email and provide valuable information about your prospects. (Were they highly qualified leads? Did they welcome hearing from you?) They also tell you how well you are addressing your target audience. (Did recipients respond to your subject line?) This is your first measure of an email's success.
    
  • Click-through reports provide more specific information about your email campaigns, telling you how many people followed your call to action and clicked through to your site to learn more. More specifically, your click-through reports tell you which links in your email got the most response. What part of your email content was most compelling and drove action? You can then shape your next email campaign to incorporate this information.
    
  • Unsubscribes show you how many people opted not to receive future emails from you. This is an important measure of how qualified your leads are and how well you are reaching them. Keep in mind that unsubscribe rates may not show the full picture of how many people are responding to your email. Many people will delete an email rather than click an unsubscribe link, for fear of confirming their email address for a spammer. A month-over-month comparison of your open rates and click-through rates may give you a more accurate picture of increases or drop-offs in your readership.
    
• Search advertising. Your pay-for-performance search advertising will have its own tracking system, allowing you to monitor the performance of specific keywords that you've bid on. You'll want to cross-reference your search advertising statistics with your own web traffic logs and sales data to see how your search advertising correlates to visitor behavior on your web site and how it impacts your sales. You can also invest in performance analysis programs like Overture's Marketing Console, to get more sophisticated measurements on specific campaigns, customer behavior, key word performance, and conversion rates.

Related Links
Learn more about Yahoo! Web Hosting Web Access Logs
Learn more about Overture Marketing Console
Learn more about direct email marketing and search engine advertising
Learn more about statistics available for your Yahoo! Store or Yahoo! Merchant Solutions account

First, let's take a look at the security features available in Yahoo! Web Hosting and Yahoo! Merchant Solutions. These features help you protect your web site data and provide safeguards for your visitors, increasing their confidence in using your web site.

• Keeping personal information safe with SSL. SSL (Secure Socket Layer) is the industry-accepted protocol used to protect the data transmitted between a web site and a web browser. An encrypted SSL connection requires all data passed between the browser and the web site server to be encrypted by the sender and decrypted by the receiver. This prevents unauthorized parties from gaining access to sensitive, confidential, or personal information such as phone numbers or addresses.

  As you can imagine, protecting data in this manner is very important when you gather customer information via a web form or online checkout pages. Customers want to know that their personal information is transmitted securely between their web browser and your web server.

  With Yahoo! Web Hosting, you can offer SSL protection by placing your form in a secure directory. Then, when the user sends the form data, it will be SSL-encrypted. With Yahoo! Merchant Solutions, transactions are protected as soon as the merchant enters a secure area of the site (note https in address) such as shopping cart, catalog request, and all checkout pages. Information is securely encrypted when sent to the payment processor as well.

  SSL also provides peace of mind to web site visitors. When an SSL-enabled connection is established in a web browser, the user will see a lock icon indicating that any data transferred from the web site to the browser is secure. Most web users demand this protection when shopping online or submitting sensitive data in a form.

  Yahoo! Small Business customers can easily access industry standard 128-bit SSL encryption in Yahoo! Web Hosting Standard, Yahoo! Web Hosting Professional, Yahoo! Store, and Yahoo! Merchant Solutions packages. To learn how to use SSL in your web site, please review our SSL instructions.

• Creating password-protected areas of your site. For some customers and clients, you may wish to have a password-protected area of your web site that is not accessible to the rest of the public. For instance, say you want to create a special area just for one client. This area might contain documents or presentations that you would like the client to review. You can place all the client's content and web pages in one folder (or subdirectory), and give your client a user name and password so only they can view this area of your site. Please note, if you are using the Store Editor, password protection applies to the entire site, and once activated, any visitor needs a password to view the site.

• Helping to protect yourself and your customers from credit card fraud. Yahoo! Merchant Solutions offers Risk Tools to help you make decisions about which transactions to accept, reject, or flag to follow up with the customer or issuing bank. These tools help validate credit card transactions, both as a measure to help protect your business from the costs associated with fraud, and also to reduce the ability of thieves to use stolen customer credit card information. Risk Tools allow you to automatically approve, flag, or reject transactions, based on AVS and CVV Rules. These rules work to identify potentially fraudulent orders, through address verification errors or CVV Codes that do not match the information on file with the credit card issuer. Risk Tools are available to all Merchant Solutions and Legacy Store merchants using the new checkout flow. You must enable the new checkout flow for your store prior to enabling Risk Tools.

Along these lines, your web site visitors will also want to know your privacy policy. Yahoo! Store's Terms of Service require that all merchants post a privacy policy in which they disclose how they use any personal information that you collect. You can easily create this page in the in the Store Editor or with an HTML/site building tool such as SiteBuilder or Dreamweaver. If you already have a privacy policy, you can continue to use it, though you'll need to make sure to:

• Add our standard privacy policy text (the built-in portion of the privacy policy page in your Store Editor) in its original form to your privacy policy page.
  
• Place the complete URL (including http://) of your published privacy policy page into the "Privacy Policy URL" field on the Order Form page of your Store Manager. Then, update your Order Form and "Publish your Order Settings" in the Manager (only necessary if you are building the page when not using the Store Editor).
  
• Link to your Privacy Policy page on your home page.

Related Links
Learn more about SSL and web forms
How to use SSL in your Web Hosting account
Password protection help
Learn more about Store Risk Tools

1. Honor your posted policies. Quality customer service is all about meeting or exceeding customer expectations. This is especially true when it comes to return and refund policies. Your web site or e-commerce store should make clear exactly what your return and refund policies are, so customers are clear about these policies before making a purchase. For example, will you accept opened merchandise for returns or replacement? Will you issue refunds or limit returns to store credit? What time limits (if any) apply to return and refund requests? When customers see these policies prior to a purchase, you are less likely to have surprises or misunderstandings.

2. Manage returns effectively with a streamlined process. Whether you have three employees or 300, you need a clear procedure for handling returns when they arrive at your place of business. Here are some of the questions your policies should clarify:
   • Who is in charge of processing the return and logging the item back into inventory?
     
   • Who is responsible for determining whether the item meets your return policy and qualifies for a refund or replacement?
     
   • Who is authorized to make the call in an exceptional situation?
     
   • Whose job is it to communicate with the customer about the return?
     
   • What is your service level guarantee? What are your standards for communicating with your customers to let them know how you are managing their return?
     
   Having a clear process for managing returns saves time, eliminates questions, and reduces the likelihood of a return getting lost in the shuffle. A clear process also empowers your staff to act quickly and independently, on behalf of your customers.

3. Sweeten the experience. If an item arrives late or is damaged during shipping, it's always disappointing. And when there's so much pressure to send the right gift at the right time, holiday shoppers have even higher expectations. For this reason, when a holiday gift arrives late, broken, or in the wrong size, it may be worth your time to acknowledge your customer's disappointment. A special coupon, free shipping, small gift, or even a personalized message from a customer service representative can make the difference between an angry customer who bad-mouths your business and a satisfied shopper who tells others about your quality customer service.

4. Establish lasting relationships. As you interact with your customers over returns, keep in mind that you are talking to highly qualified leads. Once someone has purchased from your site - even if you end up refunding the purchase - they are an existing customer. This shopper will be more likely to return to your business if they have a great experience. When you consider the cost of marketing and acquiring customers, you'll see that it may be well worth your while to give your existing customers plenty of attention.

5. Out with the old, in with the new. After the returns and refunds are settled and you look around your shelves and see the remains of the holiday inventory, don't forget to offer a clearance sale. Set up a dedicated page on your web site to promote key post-holiday savings and move the last of the holiday inventory out the door.