Tag Archives: Shutterfly Inc.

About 1723 days ago E-Commerce

Market Online without Spamming

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E-mail is still one of the best ways for small businesses to reach customers and prospective buyers. But send too many unsolicited marketing messages and you run the risk of people thinking you’re a spammer. Thankfully, there are weapons in the war on spam that companies can use to make sure their legitimate marketing messages aren’t mistaken for spam. Certifying outgoing e-mail One new tool is signing up with an e-mail certification service, which puts a sender through a rigorous authentication process to prove they’re the real deal. The services work on the same principle as website verification services such as eTrust or VeriSign. Companies submit certain information about themselves to a certification agency, including a physical address, Dun & Bradstreet listing, what their e-mail practices are, or how they obtain their e-mail mailing lists. If they’re approved, they can place an icon on messages they send showing that they’ve passed inspection. One of these e-mail certification services is GoodMail, which uses a seal of approval that looks like a blue ribbon hanging from a white envelope. When a company has the GoodMail seal of approval, the blue ribbon icon appears on the outside of an unopened message in the recipient’s e-mail inbox, as well as on a toolbar near the top of the opened email message. GoodMail has already signed up 400 companies for the service, including brand names like Shutterfly, Petco and StubHub. The four-year-old Mountain View, Calif., company also has deals with Internet service providers and e-mail service providers that account for about 65 percent of all e-mail traffic in the United States and is negotiating others, says Charles Stiles, vice president of business development. The service costs $1 to $2.50 per million messages, based on volume. Although most early customers are big companies, GoodMail is actively pursuing small businesses too, because they’re most likely not to have IT staff to deal with spam problem, Stiles says. GoodMail isn’t the only company with an e-mail authentication service. Return Path offers an e-mail white-list service, called Sender Score Certified, that the company claims covers 1.2 billion e-mail inboxes. Return Path recently announced it was acquiring another competitor, Habeas, which markets a service that follows large e-mail senders to see whether they’re complying with federal spam laws. Other companies with e-mail security technologies of one favor or another are Cloudmark and Commtouch. SIDEBAR: Other Strategies to Avoid Looking Like a Spammer Certifying outgoing e-mail is one step companies can take to let customers know they’re not spammers, but there are others. E-mail experts say they also need to: Deliver material the customer expects. If customers sign up for a free newsletter about pet care, don’t mail them mortgage offers. Stick to stated mailing frequencies. “If you say you’re going to send weekly mailings, don’t send out three in one week to make quota,” says Stiles, who was the postmaster at AOL before joining GoodMail and dealt with spam-related issues on a daily basis. Make unsubscribing as easy as subscribing. If someone chooses to unsubscribe, do it immediately. “Don’t ask them 15 times, just get them off the list” as quickly as possible, Stiles says. Block employees’ access to unauthorized Websites. The further employees wander on the Web, the greater the risk they could inadvertently let a hacker get onto the company’s network and use it as a botnet to launch spam attacks. Avoid it by using Web blocking software and creating explicit policies about where employees can and can’t go online. Check your online reputation. If you get on a spam blacklist like the kind kept by Habeas, your customers might not receive your mailings. Avoid spammer language. Pick your words carefully so you don’t accidentally include language in email marketing pitches that set off spam filters at ISPs and email service providers.

About 2485 days ago PCs, Laptops, and Notebooks

Digital Cameras that Get the Job Done

Newer technology isn’t always superior to what it replaces. Microwave food in the lunchroom doesn’t taste better than what’s cooked in an oven at home; clients don’t sound half as good over cell phones as they do over wire line phones; and it could be argued that e-mail wastes more time at work than it saves. Fortunately, you don’t have to swap quality for convenience when it comes to choosing the right digital camera for your business. Not only can today’s digital still image-quality rival (or, in most cases, exceed) that of standard 35mm cameras, but “digicams” offer many advantages. Users can see the photo right after it’s taken. The digital memory card can store many more photos than regular camera film (plus it’s reusable). And there’s no need to pay and wait for someone else to process your pictures when you can choose the ones to print — and do it at the office printer. For photo needs in today’s fast-paced business world, digital provides an easy way to shoot an image, crop and touch-up photos on a computer, and then e-mail the pictures anywhere in the world, post them to a corporate Web site, or incorporate into a PowerPoint presentation. When buying a camera for business, first examine your needs, suggests Sharon A. Curia, a New Jersey-based photographer and business owner. “If you need it to produce very large files, you should purchase a digital SLR [Single Lens Reflex] camera that produces anywhere from 6 to 16 Mega pixels,” says Curia. “Also, the kind of camera you need will vary whether you’re shooting 10 frames per second for fast sports or if it will be used to photograph still objects or people under professional lighting?” Here’s what features to look for when shopping for a digital camera for business. Form Factor You first need to decide what kind of digital camera to buy for the company. Do your real estate agents need compact point-and-shoot digicams? Or should you pick up the higher-quality (but bulkier and pricier) digital SLR variety? D-SLRs, which can be found for less than $1,000, also offer interchangeable lenses, more manual options and faster shutter speeds. Resolution “Mega pixel” is an industry buzzword that means there are one million pixels (i.e. little dots) of information per image. The more mega pixels, the higher-quality the image (and, of course, the more expensive the camera will be). As a general rule of thumb, a 4- or 5-mega pixel camera or higher can print large photos (“8.5 x 11″ or higher) without looking grainy. More mega pixels also means you can zoom in on a digital photo and crop it (e.g. focus in on one car out of six in the picture) and it will look less blurry when enlarged. If you’re only posting photos to a Web site, even a 3MP digital camera is fine. But it’s better to buy more than you need. Zoom There are two kinds of zoom: optical zoom and digital zoom. Quite simply, an optical zoom is made to bring the camera-user closer to the subject without needing to physically move. Like older cameras, this is done with a retractable lens. Digital zoom gives the illusion the user is closer to the object. Thus, the optical zoom is a more important number, as it’s the “true” zoom. Generally speaking, a 3X optical zoom is more than enough for non-professionals. Memory Before transferring them to a PC, digicams save the photos on tiny memory cards inserted into the camera, such as Secure Digital, Compact Flash, Memory Stick Duo, XD, and so on. You can often use those same cards for other compatible devices, such as a PDA, camcorder or cell phone. Usually, only a 16MB or 32MB card will be included with the camera you purchase, which is fine to start. But it’s advised to buy at least a 1GB card (roughly $50 to $70) to store hundreds of photos on those long business trips (without needing to “dump” them onto a computer before erasing and starting again). Printing What the salesperson probably won’t tell you about printing off images is how costly it can be, so be sure to use your PC to choose what you want to print ahead of time. Even with a relatively inexpensive photo-quality printer, the proper ink and photo paper can burn a hole in your wallet. So keep it “digital” if you can. Alternatively, you may choose to drop off your memory cards at a photo lab or camera kiosk. Or take advantage of those online services, such as Shutterfly.com, and they’ll print off and mail the photos to you.

About 2546 days ago E-Commerce

Shutterfly Files $92 Million Initial Public Offering

Shutterfly, a photo website that ranked No. 170 on last year’s Inc 500, is going public, the company announced Thursday. The Redwood City, Calif.-based firm, which was founded in 1999, filed a $92 million initial public offering and will trade on the NASDAQ exchange under the symbol SFLY, according to documents filed with the Securities and Exchange Commission. In its SEC filing, the company reported revenues of $83.9 million last year and identified the photo print market as its largest growth opportunity, which the company estimates will reach $30 billion overall by 2009. Other areas of growth include greeting cards, scrapbooks, calendars, and other photo-based merchandise, the company said.

About 2546 days ago E-Commerce

Inc. 500 Firm Rumored to Go Public

Shutterfly, an Inc. 500 company and one of the first online photo services, is keeping tight-lipped in response to rumors of a planned sale or initial public offering. According to anonymous sources cited on Monday by The Wall Street Journal, either deal could net the Redwood City, Calif.-based company between $400 million and $500 million. Shutterfly did not return calls for comment on Tuesday. The report also claims that the company has made several moves over the past year to prepare for a sale or IPO, such as hiring executives with experience in IPOs and mergers. Shutterfly was founded in 1999 with an initial investment by Jim Clark, founder of Netscape Communications and Silicon Graphics. The online service allows customers to store and share photographs, while offering prints and other gift items. In 2005, the company ranked No. 170 on the Inc. 500, an annual list of the nation’s fastest growing small businesses. In 2004, it posted annual revenue of $54 million and grew at a rate of 627% over the previous three years.

About 4554 days ago E-Commerce

Upstarts: Digital Photography

Photo Opportunities Digital-photo start-ups get ready for their close-up By the time Mark Platshon landed a meeting with celebrated Kleiner Perkins venture capitalist John Doerr in mid-1999, Platshon and his online digital-photo business, Zing Network Inc., had already been snubbed by a dozen other VCs. So Platshon couldn’t help bracing for rejection when — midway through his pitch — Doerr walked out and began rummaging around in an adjoining office. But as suddenly as he had exited Doerr rushed back in, hastily pulling a brand-new digital camera out of its box. Finding nothing in the accompanying literature about uploading, accessing, and distributing digital images on the Internet — a major component of Zing’s business — Doerr concluded that Platshon had hit on a missed market opportunity. Kleiner Perkins took the lead in a $14-million round of financing for Zing that closed in August 1999. “Doerr just got it,” remembers Platshon. “He understood the significance of the consumer shift to digital photography and that it would remake the entire industry in just a few years.” Indeed, Boston-based InfoTrends Research Group Inc. projects that online photofinishing will be a $4.4-billion worldwide market by 2005. The start-ups jostling for position in this emerging field have staked their claims in slightly different territories. Some have opted to become digital photo processors, creating hard-copy prints of film and digital media, and uploading digital images to the Web. (See “Someday Your Prints Will Come,” below.) Others, including San Francisco-based Zing, outsource their customers’ printing needs and focus on Web-based storage and sharing of digital images. A collage of services Among storage-and-sharing sites, Zing’s stands out for garnering some 3.5 million users each month. That’s quite a following, considering that three years ago the company was headed in a completely different direction. When Platshon stepped in as CEO, in December 1997 — after a yearlong stint with Zing investor Alloy Ventures Inc., in Palo Alto — the company was developing imaging technology for use in Web-based advertising. But by late 1998, Platshon saw a bigger market for online photography management as part of an Internet business for uploading, storing, and sharing digital images. “And so,” he says, “we changed the business.” Since making that shift, Platshon has made acquisitions a major part of Zing’s growth strategy. He began by purchasing image-uploading technology developed by FotoNation Inc. that provides a camera-to-Web connection, enabling digital photographers to plug their cameras into computers and connect through the Internet directly with Zing. Platshon has also sealed deals with manufacturers that have agreed to install FotoNation’s uploading technology in their cameras, making Zing the default Internet destination for users of digital cameras sold by Sony, Casio, and Nikon. Those deals are driving customers to Zing’s site, where product E-tailing accounts for some two-thirds of revenues, Platshon says. In E-tailing, too, he has bought his way into the business. Last January, Zing acquired Pix.com, which scans digital images onto everything from calendars and cookies to mouse pads and T-shirts. Platshon added another source of E-commerce revenues in August, when he snapped up Eframes.com, a high-margin, high-end framing business that handles its own digital printing. That deal may enable Zing to collect revenues from competitors that outsource printing and framing services to Eframes, which has retained its name within the Zing network. “Eframes can provide its services to anyone, even businesses that might be Zing competitors,” Platshon says. Enjoying its Kodak moment In contrast with Zing, which has focused exclusively on digital converts, San Francisco-based PhotoPoint Corp. has positioned itself as a go-between for film users who are just now beginning to go digital. Launched in August 1998, PhotoPoint seized an early-mover advantage in the online photo-sharing space through a partnership with PictureVision Inc., a subsidiary of Eastman Kodak Co. In that deal, PhotoPoint CEO Ed Bernstein agreed to pay Kodak a flat fee in exchange for access to the film- and digital-camera users who bring their pictures to 40,000 Kodak PhotoNet processing locations throughout the country. Bernstein proposed the deal as a way for Kodak’s digital-development division to provide its customers with long-term Internet-based storage, sharing, and image-enhancement tools. Because PhotoPoint provides free long-term storage for Kodak’s brick-and-mortar retail customers, the Kodak retailers stand to get more reprint orders over a longer time period, Bernstein says. And PhotoPoint enjoys direct access to established Kodak customers. As Bernstein sees it, PhotoPoint’s tie-in with an old-economy film-industry giant is the surest way to build market share in the burgeoning digital field. Close to 90% of camera users have yet to take the digital leap, after all. And although digital-camera sales are predicted to soar, a survey by Jupiter Communications Inc. found that 37% of consumers would rather store digital images at home than post them on the Web. Bernstein is betting that PhotoPoint can leverage Kodak’s trusted brand name to reduce such consumer wariness. When Kodak customers pick up their prints, they receive directions on how to transfer digital versions of their pictures from a Kodak site — where the images are stored at no charge for 30 days — to the PhotoPoint site, where they can get free long-term storage, as well as find tools to create and share online albums, and buy PhotoPoint merchandise. “We’re all about making it brain-dead simple to get your digital images to the Web,” says Bernstein, noting that PhotoPoint now hosts more than 13 million photos. For PhotoPoint, Zing, and their competitors, consumer education remains the biggest and most daunting hurdle. As Bernstein puts it: “Our mission is to transform customers into digital users without fundamentally changing the way they think about and use pictures.” D.M. Osborne is a senior writer at Inc. Someday Your Prints Will Come Serial entrepreneur Kamran Mohsenin eased into the summer of 1999 with time on his hands. Having recently sold his second start-up, Mohsenin was scanning the landscape for a new business venture and playing with one of the toys he bought with the spoils of his company’s sale — a new digital camera. “The camera was taking great pictures,” Mohsenin recalls. “The problem was, I wasn’t able to get quality prints.” In a flash, Mohsenin hit on the idea for his third and most recent start-up, Ofoto Inc. Soon, Mohsenin was caught up in a heated race among online digital photofinishers, including Shutterfly.com. “It’s a huge market, and the competition is fierce,” observes David Hornick, who is on Ofoto’s advisory board. Founded in July 1999, Ofoto, based in Berkeley, Calif., has adopted a clicks-and-bricks business model. Like Shutterfly, Ofoto has invested millions in terra firma photo-development labs. At the same time, online photofinishers have seized upon technological advances to carve out an Internet-based niche in the photo-processing market, which has traditionally been dominated by industry giants like Eastman Kodak Co. To the extent that these nimble start-ups can secure a foothold — and create new, Web-based efficiencies — before bigger competitors lumber into the market, their payout could be huge. Margins in the traditional photo-development business typically run as high as 50%. Thus the game right now is all about grabbing market share. Toward that end, Ofoto and Shutterfly are competing to become the photo processor of choice for a bundle of other start-ups that outsource printing for their online photo storage and sharing. At the same time Ofoto and Shutterfly are reaching out to picture takers of all stripes by offering steep discounts on old-fashioned film processing (returning prints by snail mail), as well as digitizing the images for online viewing and distribution. It’s an updated twist on a low-cost, mail-order film-processing service popularized a few years ago by Seattle Film Works, recently renamed PhotoWorks Inc., in its own bid to straddle the digital divide. For its part, Ofoto has concentrated on high-level business-to-business partnerships. It’s teamed up with InfoSpace Inc., for example, to become the preferred print shop for that company’s affiliate network of 2,500 Web-based businesses, which provide communications and commerce infrastructure services for wireless devices. Ofoto has also sealed a deal to print the digital images sold through the Internet division of Corbis Corp., which boasts an online archive of 2.1 million images — from fine art to quirky photography. Meanwhile, Shutterfly, based in Redwood City, Calif., has gone directly after consumers. Since cofounding Shutterfly, in December 1999, CEO Jayne Spiegelman has cut cross-promotional deals with such portals as Yahoo and Homestead.com. Spiegelman, who hails from senior-level retailing posts at the Good Guys and Macy’s West, has also persuaded electronics retail outlets to display Shutterfly’s sample prints at camera counters. “We wanted to connect with customers at the point of purchase,” she says. Market Snapshots A sampling of other digital-photography players Snapfish.com, San Francisco Business concept: Offers basic printing and digitizing of film images free of charge. Depends primarily on advertising revenues but also sells photo equipment and merchandise and charges for reprints. Competitive advantage: A superlow price point and a catchy marketing campaign engineered by a branding expert with experience at Kraft and Nabisco. Major challenge: Proving its advertising-revenue model, which has fallen out of favor among investors. Also, to access image files stored on the site, customers must provide demographic information used for advertising purposes. eMemories Inc., Los Angeles Business concept: Enables amateur photographers to create online photo albums. Makes money selling hard-copy prints and albums. Competitive advantage: Being the exclusive photo-sharing community for the Women.com network and the teen site Alloy.com, and securing a slot on the Earthlink personal start page. Major challenge: Beefing up its E-commerce offerings. At press time, eMemories’ merchandise was limited to mouse pads, mugs, hats, and T-shirts. DotPhoto Inc., West Trenton, N.J. Business concept: Allows digital-camera users to upload images, create their own voice-over “captions,” and share pictures through E-mail links. An ad-free site, DotPhoto offers a sliding-scale subscription-fee plan that may appeal to people who don’t want to be bombarded with marketing come-ons. Competitive advantage: Its proprietary “talking pictures” technology. DotPhoto is the first site of its kind to accept both image and sound files from digital devices. Major challenge: Gaining traction and getting noticed. A relative latecomer to the market, DotPhoto is funded by founder Glenn Paul and carries less clout with prospective partners than its venture-backed competitors do. Q&A The Big Picture Can these digital-photo start-ups successfully take on the Kodaks and Fujis of the world? The outlook might best be described as blurry. To help us bring this expanding and highly competitive space into focus, Inc. spoke to Lia Schubert, an analyst at Boston-based InfoTrends Research Group who follows developments in the online digital-image arena very closely. Q: Some entrepreneurs describe what’s happening in the online digital-image domain as a renaissance in the photography business. What’s your reaction? A: Yes, we’re seeing all the signs of a renaissance. Digital photography combined with the Internet is creating a paradigm shift in the way personal pictures are captured, shared, stored, and printed. New players are coming out of the woodwork with innovative business models. We’re seeing renewed interest in photography as a result. Q: Traditional photo processors are expected to offer digital photofinishing services in their retail centers. How can these start-ups compete with them? A: The key advantage that online photofinishers have is that they’ve already developed their services before retail solutions have been actively promoted. Online photofinishers are reaching out to digital-camera users through strategic partnerships and free-print promotions, teaching those users that it is possible to order photo-quality prints online. If the online start-ups can gain significant mind share before retail services become more competitive, then they may be able to lock in a certain portion of the market. Q: How big a slice of that market do you expect the start-ups to capture? A: It would be too speculative to predict a precise number right now. Start-ups will succeed according to their ability to secure the capital necessary to scale up their operations and to draw in and retain members. But it’s safe to say that traditional photofinishers, like Fuji and Kodak, will garner a significant portion of market share. Please e-mail your comments to editors@inc.com.