Sextoy.com

Infobox Dotcom company
company_name = sextoy.com
company_
company_type = Private
company_slogan =
foundation = 1994
founder = Dave Levine
location_city = Los Angeles, California
location_country = USA
area_served = Worldwide
key_people = Dave Levine
(CEO) & (President)
num_employees = 20 (As of|2008)
industry = Adult retail
market c

revenue = profit US$ 8.67 million ("2007")
operating_income =
url = [http://sextoy.com sextoy.com]
website_type = e-commerce
language = English
alexa = >300,000
advertising = Affiliate marketing
launch_date = 1995

sextoy.com is an American electronic commerce (e-commerce) company in Los Angeles, California. Founded in 1994, by millionaire Dave Levine, the site sells sex toys to clients across the world. Sextoy.com commenced operations in 1994, by starting off as a division of Convergence Inc. (now CNV.com Inc.), one of the first companies to sell adult toys on the Internet. Sextoy.com also runs the world's largest program for adult toy sales.cite news|url=http://www.cnv.com/|title=About Us|work=CNV.com|accessdate=2008-10-06]

One of the pioneering online e-commerce companies, sextoy.com is renowned among the adult business for innovative business strategies and the use of cutting-edge technology. Since its inception, most of the business is outsourced including shipping, order handling, and marketing by way of affiliate programs. With low overheads and a healthy growth rate, sextoy.com crossed the US$ 1 million mark in 1999, with an 84% growth. Two years later, it survived the dot-com bust. It was followed by a stagnant growth rate of 6% until 2006, when the company witnessed a 29% growth. By 2010, the organization expects a turnover of USD 10 million. The store has over 10,000 products on sale, and hopes to triple this figure by 2009.

History

In 1994, shortly after David Levine was introduced to the Internet, he realized the potential of doing business online. A few months later, he founded Convergence Inc. (now CNV.com Inc.) that he described as an "online mall". The site sold books, T-shirts, watches, and other such general items. However, stiff competition from other online retailers such as Amazon.com forced Levine to rethink the company's business strategies. Levine noticed that sex-toy division received the most sales and Internet traffic. With this data, Levine decided to focus on that category, and launched sextoy.com as an independent division under Convergence Inc.cite news|url=http://www.wickedlocal.com/somerville/archive/x254748864|title=Sextoy Dave left Somerville to find millions online|last=Bagley|first=S H|date=2008-01-18|publisher=Wicked Local|accessdate=2008-10-06]

In 1996, CNV.com Inc. started the first affiliate program for adult products. The affiliate program permitted any person to launch a website with the sextoy.com interface, without paying any royalties to sextoy.com. In return, sextoy.com handled the orders, processing, and shipping, and paid a commission to the affiliate for the generated sales. Although sextoy.com has had many people working for the organization after it was launched, none were directly employed. In 2001, "PR Newswire" ran a story on Convergence Inc. 'as the largest company on the internet with no employees'. With a revenue of $5 million the company continued to remain profitable after the dot-com bust.cite news|url=http://www.accessmylibrary.com/coms2/summary_0286-27181530_ITM|title= Convergence Inc. Has Become The Internet's Largest Company With No Employees.|date=2001-12-04|publisher=PR Newswire|accessdate=2008-10-05]

After a stagnant period between 2002 and 2006, where sextoy.com recorded single-digit growth, the company undertook a market analysis and comparisons of several e-commerce sites to improve customer services. In November 2007, sextoy.com revamped the Web site design to feature a more user-friendly appearance by using optimized graphics and streamlined navigation. Sextoy.com also invested in hardware and back-end database changes to increase response times. In addition, sextoy.com lowered the prices by about 10 to 15% to attract more customers.cite web|url=http://pornonewsnetwork.com/2007/11/sextoycom-revamps-relaunches-flagship-website/|title=SEXTOY.com Revamps, Relaunches Flagship Website|last=Admin|publisher=Porno News Network|accessdate=2008-10-06]

In June 2008, Levine and sextoy.com were featured in the adult magazine "Hustler" for the September 2008 issue, in an article titled "Living the High Life". Also in 2008, the organization was nominated as a finalist under the category "Web Retailer of the Year" for the 6th Annual XBIZ Awards by XBIZ.cite news|url=http://www.xbiz.com/news/news_piece.php?id=88459&mi=all&q=sextoy.com|title=2008 XBIZ Awards Official Nominees Announced|last=Javors|first=Steve|date=2008-01-04|publisher=XBiz|accessdate=2008-10-06]

Business model

Sextoy.com follows a business model that includes outsourcing of routine tasks such as inventory and shipping, and focusing on software to reduce human resource costs. CNV uses custom-built software to monitor the work done by vendors. With low human resources cost, a lack of a corporate office, and little overhead, the company remained profitable during the dot-com bust in 2001. Sextoy.com does not advertise, instead they rely heavily on affiliates to garner revenue and sales. Affiliates are paid up to 30% commission.cite web|url=http://www.sextoysex.com/|title=Shop on Sextoy.com|publisher=CNV.com|accessdate=2008-10-06]

To reduce shipping times, strategically-located vendor warehouses across the world. For example, a warehouse in Australia serves the lucrative Australian and south-east Asian markets.

Revenues

The company recorded a healthy growth rate in the 1990s, and by 1999, company revenues crossed the USD 1 million mark. Later, during the dot-com bubble days in 2000, revenues grew by over 80%, to over 6 million. After the dot-com bust in 2002, sales remained stagnant, with a slow growth of 6% till 2006, when the company recorded a double-digit growth.

Sales of sex toys picked up after HBO's popular "Sex and the City" featured a vibrating rabbit toy. The use of a Silky Dildo by George Clooney who plays a sex addict in the movie "Burn After Reading" has also led to interest in sex toys and has bolstered sales in 2008.cite web|url=http://www.hollyscoop.com/george-clooney/george-clooney-helps-boast-sex-toy-sales_17689.aspx|title=George Clooney Helps Boast Sex Toy Sales|date=2008-09-18|publisher=Hollywood Scoop|accessdate=2008-10-06] Sextoy.com hopes to touch a revenue of $10 million by 2010. 90% of sales are from the domestic US market, while just 10% of sales are from international orders.

Products

In addition to the flagship sextoy.com, CNV Inc. operates SexToySex.com and SexToyClub.com. SexToySex, the affiliate program, permits any person to launch a Web site of their own by using the sextoy.com interface, without paying any royalties to sextoy.com. In return, sextoy.com handles the orders, processing, and shipping, and paid a commission to the affiliate for the generated sales. The other site, SexToyClub.com is a wholesale membership club that handles bulk orders at wholesale rates. Through this program, CNV ships to both, the wholesalers in bulk, and also directly to the wholesaler's customers.

Products sold include vibrators, dildos, cock rings, rabbit vibrators, anal sex toys, and women's sex toys.Top selling products on sextoy.com include:cite web|url=http://store.sextoy.com/best_sellers.php|title=Best Selling Sextoys|publisher=CNV.com|accessdate=2008-10-06]
# Vibrating bullet
# Realistic dildo
# Lubrication
# Vibrating cockring
# Rabbit

Sextoy.com also runs an Easter special for devout Christians. The company states that eggs and rabbits are ancient pagan symbols of fertility and procreation, and after 40 days of sexual abstinence after Lent, sex and procreation are an important part of Easter celebrations. To celebrate Easter, sextoy.com features vibrating rabbit products and vibrating eggs that are sold at discounted prices.cite news|url=http://www.avn.com/novelty/articles/5666.html|title=SexToy.com Holds Easter Sale|last=Johnson|first=Nate|date=2008-03-21|publisher=AVN (magazine)|accessdate=2008-10-06]

Privacy

Due to the nature of the items sold, sextoy.com maintains discreet shipping, billing, and privacy policy. Personal information are stored on secure systems and monitored by Trust Keeper, a security monitoring company.cite web|url= http://www.sextoy.com|title=Privacy Policy|accessdate=2008-10-06] Products are shipped inside plain cardboard boxes with a Convergence return address, and credit card statements are billed to Convergence Inc.cite web|url=http://store.sextoy.com/faq.php?a=sextoycom|title=Frequently Asked Questions|publisher=CNV.com|accessdate=2008-10-06]

Timeline

ImageSize = width:400 height:300PlotArea = left:40 right:0 top:10 bottom:10DateFormat = dd/mm/yyyyTimeAxis = orientation:vertical format:dd/mm/yyyyPeriod = from:1993 till:2009AlignBars = earlyScaleMajor = unit:year increment:5 start:1995ScaleMinor = unit:year increment:1 start:1993

Colors = id:gray value:gray(0.7) id:lightsteelblue value:rgb(0.418, 0.609, 0.800)

Define $dx = 20 # shift text to right side of bar

PlotData = bar:event width:20 color:gray shift:($dx,-4) from:start till:end color:lightsteelblue mark:(line, white) at: 01/11/1994 text: Convergence Inc. founded at: 05/05/1995 text:sextoy.com launched at: 01/06/1996 text: Affiliate program launched at: 01/11/1999 text: Revenues cross US$ 1 million at: 18/01/2008 text: Nominated for XBIZ award

ee also

*sex toys
*amazon.com
*Good Vibrations (business)

References

External links

*official|http://www.sextoy.com