Zoovy CEO David Steel

The song, the one by Leroy VanDyke in 1959, tells about a boy from Arkansas who longs to be an auctioneer. He went off to school and learned how to say things like, “Thirty dollar bid it now, thirty-five Will you gimmie thirty-five, To make it thirty-five, to bid it a thirty-five Who would bid it at a thirty-five dollar bid?”

And he said it in about a second and a half.

Well, nowadays, that boy from Arkansas or anywhere else doesn’t have to be a fast talker or an auction school grad’ to cash in on the love affair people have with bidding on things for auction. In fact he could be what lots of us lovingly call a nerd—slow talking, computer code writin’ fellows who understand how things like eBay and Overstock work and can make improvements on those concepts.

David Steel and Brian Horakh are two such people. Steel designed networks and Horakh, with a photographic memory, wrote code. They started a company called Zoovy—the last, “five letter, three vowel domain name we could find.” And as nerds are often given to do, they did an experiment.

STEEL: I was responsible for building the network for the city of Escondido (California) and my partner Brian was playing with a lot of different web technologies and with ecommerce on the side. We were looking to develop the best ecommerce tools ever created that would automate a merchant’s entire business. Our goal was to design the best ecommerce platform in the industry. Brian had a site up called Nerd Gear, with silkscreen tee shirts and other items that would appeal to technology-folks.

Well, Brian had some seconds of clothing and he launched them out on eBay. The first thing we noticed was that then, in 1999, people would pay even more for the product than they would pay on the website when they got into the bidding thing. Brian even put up big promotion links and would say things like, “you can buy it cheaper here,” but people still bought on the auction site.

This led us to think that if we could automate the process of using the auction-based marketplace to drive traffic and acquire customers, we would greatly assist our merchants in becoming successful online. So, in 2000 we designed software that would use marketplaces like eBay and Yahoo to drive sales and traffic to our customer’s sites.

One of the things we learned early on was that people (in ecommerce) don’t really think about the back end, things like shipping and order management and bookkeeping, until it’s right on top of them. So, we thought if we could integrate all of that into these marketplaces we would really have something.

PeC: Once you figured out that your ideas would work and that anybody could integrate with the auction concept, what did you do first—just start writing code?

STEEL: Well, we really are a development company, and in those early days we were writing code and building the databases to handle the products. What we were looking to build specifically was a content management system that would maintain inventory across those various marketplaces and the seller’s website. We wanted to be able to enter the data once and then use it wherever we wanted, which is the way technology should work.

At the time, eBay didn’t love us, because we supported other marketplaces. They wanted us to be a hundred percent “eBaycentric.” In fact, a lot of the companies at that time had names like Auction Block and AuctionWorks and very much focused on that base. For us, it was about getting the product out and in front of as many potential buyers as possible.

PeC: Auctions are hot items in the Internet world. However, the technology is still a little hard for a new ecommerce merchant to get his or her head around. It appears that Zoovy has lowered the entry-level-bar for new sellers. How does it work in reality?

STEEL: It’s pretty straightforward. First, we provide training for the merchant. We teach them how to get products in and how to set up their templates for auctions, manage their orders and market to their customers. We very rarely find merchants who want to just sell on one marketplace anymore. What they want to do is set up their own business, their own store, and they want to use various marketplaces to acquire customers and move merchandise. (Editor’s Note: See the profile of greatlookz.com, a Zoovy client, in this issue.)

PeC: If that is a trend, are there other trends you’ve picked up on?

STEEL: The big trend we’re seeing is a lot more Web 2.0 development, especially in ecommerce. One of the things we’ve embraced is AJAX, which has allowed us to use an easier interface for our merchants who are bringing their products in. More importantly it provides a richer and better buying experience. For example, you don’t have to leave a web page as you are adding things to the cart. The shopping cart is updating on the side of the page where you can see it. In addition, much better search capability and larger databases are possible.

PeC: There may be some of our readers who don’t know about AJAX. Could you fill us in?

STEEL: AJAX is a component of Web 2.0. It’s a new way to develop applications. Using AJAX design we can create much simpler and better user interfaces. In addition they operate much faster. The most widely used example of AJAX is the new Google Maps program. It is very fast. When you ask for an address, the response is immediate. The reason is that a lot of what is done happens right in the web page as opposed to having to go back to the server to retrieve all the data. We’re seeing a lot of new AJAX applications and they are just a whole lot more intuitive.

*PeC: Obviously, Zoovy and AJAX and all of the new technology have opened up new frontiers in which more than one server, in fact several, may be involved in a transaction or the service of a site. That presents another set of security issues for merchants. What have you and Brian done at Zoovy to try and deal with potential security breaches? *

STEEL: Well, we’re actually hosting our customer’s website. To date, we haven’t had any security issues and will not in the future. It’s a UNIX environment that has been hardened. We know that this is the one thing that can really hurt an ecommerce website. I think when merchant’s host their own site on a “shared box” in some random ISP is when they have a good chance that something will eventually get hacked. We have our own server farm and it is locked down tight.

Security is a key thing. One of the companies we have been working with is called BuySafe, and they help our customers bond their transactions with marketplaces like eBay and Overstock. But, sometime in the near future you’re probably going to see Bonded Websites. It is just inevitable, because people want to be secure in their online shopping experience.

PeC: You seem to have a very positive outlook on ecommerce. What’s your overall take on the future?

STEEL: First, I think we are starting to see a little more diversity in where people are selling. People are focusing on their own sites and specialty sites. People are not focusing a hundred percent on eBay anymore. Part of the reason is that there are folks who have tools like ours where they can launch thousands of products in a few moments. It’s a lot more competitive.

Ecommerce is just going through the roof. It’s getting better and better each year. But, I also think the technology is getting better. You won’t see people be successful with these little homespun Front Page sites anymore. Customers expect more. I also think you’ll see more of the bigger ecommerce sites switching over to the AJAX technology. You’re starting to see some of that technology in Amazon already. Google and Yahoo are investing heavily in it. You’re going to see sites that need to get upgraded to the new technology, because people will be get used to it and expect it. And, they are going to want to buy that way.

STEEL: Zoovy is honored to have assisted so many businesses in becoming successful online. It is my personal mission to help any company realize their success in the ecommerce world. We do that by taking care or our customers and providing the best ecommerce technology available.