MSCdirect.com launches, seeks market share

By Staff -- Industrial Distribution, 11/1/2000

Melville, N.Y.-Backed by an extensive marketing campaign, MSC Industrial Direct Co., Inc. launched MSCdirect.com in September.

Since the September 15 launch date, the business-to-business horizontal marketplace has given MRO customers electronic access to MSC's catalog of more than 450,000 SKUs. MSCdirect.com plans to add more than 40,000 SKUs per year. The site offers online customers the same-day shipping guarantee it provides to MSC customers that purchase through traditional channels.

Director of e-commerce Erik Gershwind says the company plans to grow sales per customer and to reach out to industries where the company doesn't have a significant presence now. Also, MSC wants to use the site to reach larger companies in all industries that are purchasing more industrial supplies over the Internet.

In a news release, chairman and CEO Mitchell Jacobson stated that the product offers customers unprecedented levels of service. The search engine, for example, allows customers to order by description, vendor, brand or even by a competitor's part number.

"Both new and traditional customers are being attracted to MSCdirect.com because it offers a low cost solution in combination with reliable and easy-to-use searching, tracking and payment capabilities," Jacobson stated.

Gershwind says the system offers real-time and back-end integration, which allows customers to see inventory availability, order status, UPS tracking information and order history. In addition, customers can set up accounts and pay online.

When a customer places an order, it moves from the desktop to the distribution center. Ideally, this reduces human error and transaction costs. The ultimate goal of the site is to drive down the customer's cost to place an MRO order, Gershwind explained.

"This allows them to make fast purchasing decisions and to electronically expedite their transactions," Gershwind said.

Gershwind declined to disclose the response since the launch date, but says the site is outperforming internal goals. "By adding SKUs we significantly grow our sales per customer," Gershwind said.

The company is also using a targeted marketing effort, including direct mail, telemarketing and customer training, to drive customers to the site. During the 2001 fiscal year, which ends in August 2001, MSC plans to send 8.75 million brochures to prospective customers and 13.5 million brochures to existing customers. The 500,000 customers who get the company's Big Bookrwill also receive a four-page insert with instructions on using the Web site.

While the site is part of MSC's rapid growth strategy, Gershwind says, he would not reveal whether the company has plans to increase staff or add to its four distribution centers.

"We have worked hard to produce 30 percent compound growth over the last five years," Gershwind said. "Our e-commerce strategy is a part of our growth story and as such, we plan and execute in advance of anticipated volume."