E-commerce spurs winning year for St. Louis Park-based patio retailer, rare in COVID-19 era

Patio furniture store Yardbird is the rare retailer that is doing better this year than last, something co-owner Jay Dillon attributes to an e-commerce partnership that allowed continued growth through pandemic shutdowns.

Dillon was planning to open physical stores in Denver and Kansas City in early spring to add to his St. Louis Park showroom. The coronavirus stay-at-home orders postponed that plan and forced him to pivot quickly to his online shop.

"We were closed for about six weeks at the start of our busy season, so any sales had to occur online or over the phone," he said. "We got twice as much revenue from online sales in 2020 [so far] compared to 2019."

As a small retailer, Dillon always felt a segment of consumers wanted an easy online ordering system, even for a product as bulky as patio furniture. He had even migrated to the e-commerce platform Shopify, but online sales were not top-of-mind because he never foresaw a time when customers couldn't or wouldn't enter his showrooms.

What he found, like many other small retailers this spring, is that Shopify is a cheap and relatively simple e-commerce platform to process online orders.

Dillon also quickly shifted his marketing emphasis to his website and, because of price specials at newspapers because of the coronavirus, he placed full-page ads in major newspapers from the New York Times, Washington Post and Los Angeles Times to his targeted-city publications of the Kansas City Star, Denver Post and Star Tribune.

It turned out the e-commerce strategy opened up Yardbird's merchandise to thousands of new customers.

"When the weather turned warmer in March, it became clear to us that our online store was on to something and our competitors weren't selling well at all," he said.

Other local retailers also turned to Shopify or other online e-commerce platforms to try to boost sales while physical stores were closed this spring. Building its own e-commerce platform was cost-prohibitive for Martin Patrick 3 in Minneapolis' North Loop neighborhood.

"A capital investment of $150,000 to $200,000 to hire a company to build e-comm from scratch would be absurd for us," said Carrie Fryman, director of buying and marketing for Martin Patrick men's apparel and home furnishings. "We're not an e-comm retailer. But there's a middle ground now. Shopify lowers the price barrier so we can dip our toes into e-comm."

Many closed retailers across the country had no online stores and after the stay-at-home orders closed their physical locations, they had few choices beyond curbside delivery. That resulted in them losing in some cases 90% of sales.

"Small retailers are feeling the effects of being laggards in e-commerce," said Ryan Ellis, founder and partner in RMG Media in New York, a digital commerce agency. "They'll say 'Why do I need to set up e-commerce for my geographically small footprint?' and I say the internet is your 24-7 billboard. It's like having another location."

Small businesses can spend as little as $200 a month on Shopify, Ellis said. Base fees range from $29 to $79 a month plus transaction fees of about 3% per transaction.

Shopify, based in Ottawa, Canada, is not necessarily a household name. It provides technology for a retailer to set up an online store, sell the goods from the site, monitor inventory and include curbside pickup and delivery.

In 2019, it became the No. 2 e-commerce platform with 6% of U.S. sales behind Amazon. In April, new online stores using Shopify grew 53%, according to a Shopify spokesperson.

Vishal Naithani, owner of Sol Organics textiles in Edina, chose Shopify for the e-commerce side of his business two years ago.

"It's an instant plug-and-play platform," he said. "It's like Amazon for retailers who want an online presence."

Naithani, who also considered platforms such as Wix and WordPress, saw steady sales increases even after COVID-19 began.

"E-commerce saved us," he said. "Our wholesale accounts bought less from us, but a lot of new customers found us online. It feels odd to say, but the way consumer behavior switched since the pandemic has benefited us in ways we never expected."

Predicting consumer behavior as the country reopens remains difficult, but many older shoppers have found e-commerce more desirable since the pandemic.

"Some people won't feel comfortable going into a store until we have a permanent solution to the pandemic," said George John, professor of marketing at the University of Minnesota's Carlson School of Management. "Some people are clearly more risk averse, especially baby boomers."

Pam Sunshine of Tenafly, N.J., said she was nervous about buying patio furniture at Yardbird.com, but she felt she had to because of the pandemic.

"I would have liked to sit in it before spending thousands, but COVID made me order online," she said. "I read the reviews, checked their return policy and liked the fact the they didn't have a million choices."

Mike Klein, president of Peters Billiards in Minneapolis, said that before the pandemic, about 15% of the store's products were sold on its website. Within the next two months, Peters will make 100% of its inventory available to be ordered on its site.

"People are going to change the way they shop and we need to be prepared for that," he said. "Even if it's a pool table or a leather sofa."

The shift to online ordering will make it easier for local customers, but delivery will also be an option for customers nationwide. Klein considered Shopify but plans to use ExpressionEngine due to a need for a more robust platform. Shopify customers who recommend the platform admit that it's not without limitations.

Nicole Jennings, owner of Queen Anna boutique in the North Loop, has used Shopify for seven years and was glad to have it when the pandemic hit.

"The website is always going to be an integral part of the business if you want to get beyond brick and mortar," she said. "But updates can be taxing with Shopify if you don't stay on top of e-mailed update notifications."

Austin Wiens, a marketing analyst at WSI Sports in Eagan, found Shopify pretty easy despite having no web-building experience, but adding in customized features his company offers was a challenge.

"We do a lot of customizing of our own products that Shopify couldn't handle, so we had to do our own coding," he said.

Dillon, whose company used Magento before switching to Shopify, finds it easier to use, but admits that search-engine optimization (SEO) is not its strongest point.

"Have you ever seen a Shopify account that's No. 1 in its category?" asked C.J. Merry, owner of Minneapolis Made, a web-development company. "It's not that good for SEO, and it's not that expandable."

While plenty of other low-cost e-commerce platforms exist — WordPress, Wix, Wu and BigCommerce — some brick-and-mortar shops are still resisting the online call.

"I don't think our customers are as interested in shopping online," said Pat Schindler, owner of Paddy-O Furniture in Eden Prairie. "I'm on the nicer end of patio furniture and people want to sit in it before they buy it. There's still room for old-school out there in patio furniture."

John Ewoldt • 612-673-7633