Keeping on the cutting edge
To bring customers and technology together, the company has the obligatory call center and a Website estimated to get more than 10,000 hits a day. Time magazine recently named iGo to its 1999 "Best Sites on the Web" online shopping guide.
But iGo also employs certain customer service protocols that it believes distinguish it from competitors. CEO Ken Hawk said in the interview that those competitors include "retail box players like Circuit City and CompUSA, [which] have minimal mobile selection and minimal service."
For instance, an iGo Website customer with a question or problem can get real-time assistance through online messaging, a service similar to Internet relay chat or America Online's instant messaging.
"This is a great combination of Web convenience and that personal, human touch," said Tim Miles, one of iGo's customer solutions supervisors.
Interactive product software that links a customer's Web browser to iGo's computer system allows representatives to direct buyers to areas of iGo's Website or affiliated Websites. Depending on the browser, the information either appears on the customer's computer screen or is sent via hyperlink.
iGo also uses something called electronic commerce modeling language in the ordering process. This software streamlines the collection of electronic data for product shipping, billing and payment. Other supporters of this software include Dell Computer Corp. and Nordstrom.com.
iGo estimates that by the end of 2000, 75 percent of its sales will be made over the Web, with its catalog operation accounting for the remaining 25 percent. Catalog and Internet sales for 1999 were about equal. In 1998, only 30 percent of iGo's sales occurred electronically.
Spending big to make it big
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Like other Internet companies, iGo has been spending heavily to increase those sales, beef up its staff and strengthen its brand name. From a modest $4.2 million in 1996, net revenue tripled in 1998 to $12.8 million and quintupled in 1999 to $21.0 million. Full-time employees have more than doubled since October, 1998.
But this growth has come at the expense of short-run profits. So while iGo posted record net revenues in 1999, the company's loss for the year was $15.0 million, compared with $1.9 million for 1998. Hawk said the loss doesn't indicate problems with the long-term effectiveness of iGo's business model or strategies.
"We are pleased with our year-over-year and quarter-over-quarter revenue growth and continue to be excited about the progress of our business," CEO Ken Hawk said.
These year-end figures are the first reported by iGo since the company raised $55 million after expenses in an initial public offering (IPO) of 5 million shares of stock on Oct. 14. Hawk owns a 24.8 percent stake in the company after the IPO. The stock trades on the Nasdaq exchange, and Wall Street analysts rated it as a buy throughout last November. Local market watchers also seemed enthusiastic.
iGoing to the market
"I bought a chunk on the first day of trading," said Michael Mackay, a young Reno investor whose portfolio includes other technology stocks. "I like being able to support a local business. And I think iGo has a great team and great potential."
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The stock opened at $12 a share, rose 17 percent on the first day and traded at an average of $20 to $21 per share during November. Since that time, the issue has dropped as low as $6.25 per share but has risen to an average of about $8 or $9 a share in recent weeks.
Hawk said the company plans to use the IPO money for sales, marketing and general corporate purposes.
"We plan to consolidate our [market] lead," he told CNN. "We're going to continue to grow that lead and, of course, expand internationally. We have a great opportunity overseas in Europe." Europe has a higher per capita percentage of cellular users than North America.
Hawk also told the Reno Gazette-Journal in November that expansion could take the form of strategic acquisitions.
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