By Cecil Hoge
At the time we had decided to launch our website, SeaEagle.com, our line of inflatable boats had shrunk from 12 models to 6 models. A major reason for this is that our supplier for supported fabric boats had been taken over by a competitive inflatable boat company. So our supplier of Sea Eagle Explorer kayaks and Sea Eagle transom boats, who at that time was Hutchinson Marine in France, got bought out by another French company making Bombard inflatable boats. The founder of Bombard boats was a man named Alain Bombard. He was a French biologist who became famous for taking an inflatable boat across the Atlantic Ocean.
After a few years of having the manufacturer of Bombard boats make our Explorer kayaks and transom boats, they got bought by Zodiac. At the time, Zodiac was the most famous inflatable boat company in the world and they politely told us they had no intention to make inflatable boats for a competitor. That temporarily put us out of the Sea Eagle Explorer kayak and Sea Eagle transom boat business.
So, in 1996, our line of inflatable boats consisted of the Sea Eagle 330 and 370 inflatable kayaks, the Sea Eagle 8 & 9 Motormount boats and the Sea Eagle GT-10 & GT-15. The GT-10 & GT-15 were unsupported special formula PVC boats that had truly excellent motoring performance at quite a reasonable cost considering the fact that they took 10 and 15 hp outboard motors. Because these boats had no actual inside fabric threads (the strength of materials came from the thickness and the special formulation of the PVC), they could not be inflated to the same working pressure as fabric supported boats. So they worked at around 1 psi instead of 3.2 psi. Nevertheless, because the material was a super thick, special formula material, they were quite excellent inflatable boats and we sold thousands of them in the years leading up to 1996.
My brother John Hoge first came into the business in 1989. John’s first focus was to upgrade our clunker computer system. In the late 1970s and the 1980s we had an IBM 36 with about 14 work stations. This mainframe computer got us through some ups and downs in business and, after we got it to work, took everything we could throw at it. It was a big computer, but it took almost 10 years to get this beast of a computer to work the way we wanted for our strange and quirky business.
I should point out that we had two businesses to keep track of and they both were quite different in their own way. Panther Martin was a trade business selling fishing lures to retailers like Bass Pro and Cabela’s and wholesalers servicing everything from Mom and Pop stores to WalMarts and Kmarts. Sea Eagle boats was primarily a mail order company selling directly to the public by classic mail order – about 70% of the business was individual orders going to individual customers, about 30% of the business was to small dealers and some mass merchants.
Because we had two different kinds of businesses, it meant that we sold products at different prices and at different discounts. And even in the early 90s we had over 800 different sizes and colors of Panther Martin fishing lures and while we had only 6 models of inflatable boats, we still had over 200 different kinds of accessories that we sold with the boats. If you add to the fact that we had already 1,000 items to keep track of, the fact that in the fishing lure business we had to pay the government excise tax in the boat business we did not, the two businesses represented a pretty complex computer problem. Complicating that was the fact that we were buying in different foreign currencies which were always going up and down. Keeping track of all those variables was a pretty tall order.
And then there was the simple fact that we had two different customer bases, with each company having sales divided between individual mail order customers and trade companies…so, in fact, we had four sets of different customers. All this meant that my brother John was kept quite busy in the first few years implementing a computer system to keep track of it all. Fortunately, it did not take ten years to get the new computer system working the way we wanted it. The new system was pretty much up and running and keeping track of almost everything in the first six months. Still, it was a mammoth job, taking a solid year and half of my brother’s time.
Strangely enough, the mix of the two businesses is roughly the same today. What was different in the 1970s, the 1980s and the 1990s was that the Panther Martin lure business was the larger part of the overall business while today Sea Eagle boats is the larger part of today’s overall business.
I now need to mention an important fact: My brother and I had a father, named Cecil C. Hoge, Sr. It is quite common for sons to have fathers, but our father was a rather interesting man. In the mid 70s he had given official ownership of the two businesses over to me and my step-mother. I have a theory about that and my theory is that he decided to turn over the business because he realized that I would never amount to anything unless I had true responsibilities.
At the time, my father was really in the prime of his business life, so turning over the business to us was a really unique and noble gesture. And that is particularly true if you knew my father. He was a particularly active and intelligent businessman. He came at the world of business from a marketing perspective…something he picked from his father, Huber Hoge, who owned an advertising company in the 1920s called Huber Hoge, Inc.
I have posted a story about my father on my personal blog site called TangledTalesofanAmericanFamily.com. In a story entitled aptly: “Cecil Hoge, My Father” I give a lot of details about my father’s rather colorful marketing and business career. Should you want to learn more, please feel free to check it out.
Here is a brief summary of my father’s career. My father was happily going to the University of Virginia and living the original party life, when the Depression occurred and he realized that my Grandfather was going to lose his business. So my father left the warm and friendly clime of Charlottesville and headed back to New York to help the family. I believe my father’s first job was at a now defunct newspaper called the New York Sun. In the Depression, selling anything was hard, but my father found a way to become quite a good salesman for classified ads in the New York Sun considering the sad state of the economy.
My father told me some stories about those times. Almost as soon as he got back from the University of Virginia, he and his family got kicked out of the very nice apartment they were living. You would think that would be a catastrophe and no doubt it must have seemed like it at the time, but it turned out this happened to many formerly prosperous families. That meant that many apartment buildings in even the best part of New York City had very few tenants who could actually pay the rent.
What do you do when nobody can rent? You cut deals and that is what many of the best apartment buildings did at the time. So, my father and his family, which at the time consisted of 3 other brothers, a sister, a mother and father, moved from one fine apartment to another, each time cutting a better deal and each time running out of money and having to move on. It was a trend of the times.
Another trend is the fact that taxi cabs could no longer get full fare. My father told me that he might be coming back from a party, strangely dressed in a tuxedo or tails, with almost no money for a cab. What did he do? Knock on the window of each cab, and in those days there were plenty of cabs sitting on Park Avenue or Fifth Avenue patiently waiting for a lone fare to show up. So my father would knock on a cab’s window with one nickel in his fingers. As soon as he caught the attention of the cabbie, he would hold up the nickel. While many cabbies refused that as a fare, my father said he always found a cab willing to take the nickel. Those were the days of desperation and depression.
So, my father came from a prosperous middle-class family, went to the University of Virginia and after two years of thinking the prosperity would never end, he found himself and his family destitute. It was a story lived many times in many homes and apartments at the time.
“It took ten years out of your life,” was my father’s description of the Depression years. No matter, my father first sold classified ads at the New York Sun and then, because he was such a dynamic salesman, moved up to selling display ads. For those of you are not familiar with the difference between classified and display ads, classifieds were little one column one or two-inch ads with 30 or 60 words of copy and no picture, while display ads could be anything from 1/8 of a page to a full page. Display ads were called that because they usually included one or more pictures or drawings.
As the depression rolled on, my father moved up in the world first earning $20 or $30 dollars and then earning several hundred dollars a week. This was possible at the time because part of the pay came from commissions earned from sold ads. This newfound relative prosperity caused my father to get married and change jobs. For a while, he did a stint selling ads at Vanity Fair Magazine, which must have been pretty exciting since it was a very trendy magazine run by a gentleman who, according to my father, liked his drinks a little bit too much. The original Vanity Fair Magazine did not make it through the 30s, but my father did.
When World War II arrived my father said, “Suddenly, everybody had a job and the Depression was over.”
After the war, my father joined forces with his brother to re-institute his father’s advertising business. The new company was called Huber Hoge & Sons Advertising. This became a force in mail order advertising during the late 40s and early 50s. My father handled advertising for Double Day Books, Jackson and Perkins Roses, Arthur Murray Dance Studios and a number of other pretty prestigious advertising accounts.
In that period my father got the mail order bug bad. In doing so, he decided instead of running direct mail advertisements for other people, he could do a lot better running mail order ads for himself on products that he controlled. And that is what he ended up doing.
In the mid 50s, my father was advertising and selling a diverse selection of products…pocket adding machines, dress forms for ladies, paint brushes, art instruction courses, dance instruction courses, TV repair books, fertilizer for lawns and gardens and many other odd and quirky products. If you are looking for some common product thread you will find none. In fact, the common thread was that my father would try to sell anything that could be sold through mail order. And that is how we first got into the fishing lure business. Not because my father was an avid angler, not because my father knew something about fishing, but because he had an accountant who liked fishing and who told my father to run an ad on a particular fishing lure.
My father ran the ad as a favor to the very persistent accountant. Somewhat to my father’s horror and amazement, the ad worked and he sold over $1,000,000 of our original fishing lure called “Vivif” in the first year. That was quite a feat in 1956. In those days, one million dollars was real money. That experience convinced our father to go into fishing lures big time and shortly thereafter my father bought a company that had, among a myriad of fishing tackle products, Panther Martin fishing lures.
The year before my father bought Panther Martin, it had sold about $8,000. The year after he bought it, it sold about $15,000. That was not a big success for my father, but Panther Martin lures turned out to be one of the greatest fishing lures ever made. Fast forward to today and we have sold over 110,000,000 Panther Martin lures. So from a small acorn came a large oak tree.
Over time, our father migrated away from some, but not all, of the many weird and wonderful mail order products that he had previously sold. By the time I came into the business in 1968, we had already become primarily a fishing lure business that happened to buy in that same year an inflatable boat business. By the time my brother came into the business, in 1989, we were a fishing lure business that happened to own an inflatable boat business. As I mentioned in Part I of this history of Sea Eagle Boats, Sea Eagle boat sales went up and down year to year. By the late 80s, it had a couple of years when it was actually bigger than our Panther Martin business, but most years, Sea Eagle was the smaller business. Panther Martin was a different kind of business in that its sales generally did just one thing: increase.
Now I also mentioned that my father did something very unusual for a man who had been pretty successful most of his business life – he turned over the business to me and my brother. The first few years of my brother coming into the business, the boat business was owned by me and my step-mother. That changed in 1993 when John’s mother passed away. From that point on John was my full partner.
After turning over his ownership in both companies, my father went on to a pretty successful career as a business writer. His specialty was mail order marketing and the evolution of mail order marketing into online marketing. He wrote and published 5 separate books on marketing. His first book, called “Mail Order Moonlighting,” sold over 100,000 copies. In 1983 he wrote and published another book called “Electronic Marketing”. In that book, in 1983 he predicted what he called “electronic catalogs”. This was really before the internet got going, but our father was already predicting its arrival.
Given our father’s background and his new writing career and the fact that it was related to the type of business we were already in, my father could not help but make suggestions on how my brother and I should run Sea Eagle.
In the early 1990s, Sea Eagle was selling about 4,000 or 5,000 inflatable boats a year with most of them being our unsupported PVC inflatable dinghies, kayaks and sportboats…the Sea Eagle 8 & 9 motor mount boat, 330 & 370 kayaks and the GT10 and GT15 sport boats. While we have discontinued the GT sport boats and the Sea Eagle 8, the Sea Eagle 9, 330 & 370 remain popular models that we continue to sell year after year up until this day.
From my father’s point of view, our fishing lure and boat business had descended into traditional and rather boring businesses. We had a brief period in the 1980s when the boat business had surged ahead for a few years and surpassed the fishing lure business. But after that, the boat business again slowed while the fishing lure business kept growing. In my father’s mind, it was all kind of boring. He liked the frenzied activity of a promotional mail order advertising campaign and in the early 1990s, while we had direct sales of the inflatable boats that generated considerable sales, we had no one promotional program that drove the whole business forward.
Our father had one suggestion: “Get on that goddamn internet.”
As I have mentioned in my blog story on my father, he rarely took the Lord’s name in vain or cursed in any way, but when he got agitated about something, as in this case, sometimes the words would slip out.
Now I was the marketing guy who knew nothing about computers while my brother was the computer savvy guy who loved computers. So my brother led the charge in actually setting up and getting us online. We had many discussions on how to do this. One big question was whether to create an order cart where customers could place orders online or to just put up a phone number and an address to call or mail for more information. In the first year, we chose to forego the order cart and we just listed our phone number and address so customers could either contact us by phone or write in for a catalog.
One of the debates we had was whether anyone would order online in the first place. In 1995, when we started the process of going online, not many companies were taking orders directly on the internet. Amazon was just getting started – they came online in August of 1995 – and at the time they were thought only to be a bookseller. So, the first question was, would anyone actually order an inflatable boat on the web. The second question was if they ordered on the web, when and how would they order. That was important because while we could take phone orders or input mail orders during working hours, we had no way to take orders after working hours.
So our thinking was that we would probably not gain much having an order cart, but maybe we would get additional orders when people either called or mailed us. It still was an alien concept to us that someone would order in the middle of the night without being able to ask questions of a live person. We thought, in our infinite wisdom, very few people would actually order outside of working hours.
Why we thought this is still something of a mystery. After all, most people work during the day and therefore they supposedly would not have time to order during the day. But our long history in mail order boat business told us differently. All the orders we ever got was during the day and even when we had “800” phone numbers ready to take orders at night, we almost never got an order after 5pm.
In March of 1996 we put up our website showing 2 basic models – the Sea Eagle 8 and the GT15 – and giving an 800# to call us to get a catalog, if interested. It was about as simple and as low key as a website could be, but then in 1996 there were not many websites, and of those that were up, they were not very sophisticated. When someone called for a catalog, we would give any inquiries we got a special website code, which, if I remember, was MW096B. The MW was to indicate it was a miscellaneous web inquiry, 096 was the year and B was for boats.
For the next 10 months, we did not do anything but wait and see what happened. The first reaction in the immediate months after we started the website was underwhelming. So underwhelming that after a month or two we stopped monitoring how many sales were coming from it. We just let it sit and mellow.
And mellow it did. By the end of the year, to our surprise, we found that we had sold $56,000 in the first year on the web. Hmmmh. We pondered this a while and then surmised that even if we counted all the time it took developing the website, the sales were profitable. You see it did not take a whole lot of time to make a few single web pages with some images, some brief description of each product and an 800#. Yes, there were a few links to some other pictures and some more detailed construction features, but all in all, the website was amazingly simple. I do not know how long my brother spent on this, but I doubt it was more than 2 or 3 days, if that. So $56,000 for two or three of work was not bad in our minds
This led to making some further development of the website in 1997 and 1998. We added a few more products, we had some more description and pictures of accessories. We put in more links for explaining more features and benefits. In truth, the website was still very crude. In spite of that, the sales we tracked directly to the website went from $56,000 in 1996 to $108,000 in 1997 to $256,000 in 1998.
At that point, we still had not added an interactive order cart. We had a lot of discussions about adding an order cart. It involved quite a bit of extra work and we really wondered: would people actually be comfortable giving their credit card and placing an order. We were not sure. Another question that we continued to ponder was whether people would actually order at times when we were not open, when the customer could not call up and ask specific questions about our inflatable boats.
Now, we could see that if people ordered when we were not open, that could be a real benefit. That might be added business. However, we were still not sure if there would be an overall benefit for the consumer. Even though we did not have the same number of boats in those years, we thought our products were pretty unusual and because of that we thought answering people’s questions about our products over the phone was the most important thing we could do.
By the time we had sold $256,000 in one year on the web, our views were beginning to change. Web sales were becoming a significant part of our overall Sea Eagle direct sales and we could see that they were contributing to the growth of Sea Eagle overall sales.
March of 1999, we took the plunge and added an order cart. It took several weeks of hard work on the part of my brother to get it up live and running. At the moment of launching our interactive order cart, we still had several questions:
Would people give their credit card information and place an order directly on the web?
Would people order off hours without calling us and without asking us a lot of specific questions about the product?
Would online orders increase our overall sales?
We knew the answer to all three of the questions above within a month. It was a categorical “yes”.
In 1999, our web sales again more than tripled while regular in-house phone and mail orders also went up, but more marginally. Not only that, the fact that we had a website seemed to also help our trade sales. And most strangely of all, the fact that we had website sales seemed to attract the attention of other websites. So, in 1999, Amazon came to us and first starting selling our boats on their website.
This was counter-intuitive at first. We figured that our direct sales might be seen as a threat to their sales. But Amazon seemed to take a more benign view of it and think, if we could sell our boats on the web, then they could sell our boats on the web.
I have to say from 1999 on we enjoyed substantial organic growth each and every year thereafter. Now, as I have mentioned, in the past, the 1980s for example, we had some periods of great growth followed by dramatic slowdowns.
From 1999 on, growth was different. It was both rapid and a steady. There was no falling back in sales as we got into 2000, 2001, 2002, 2003 & 2004…we just kept growing. Of course, we did a lot of correct things…we expanded the website, we added videos, we added new exciting products. And the growth came both in our direct sales and in sales to trade customers. What did change was our trade customers became almost entirely other websites, rather than Mom and Pop dealers. That was good and that bad.
We were suddenly exposed on lots of websites and the total awareness of our brand went up accordingly. But we were no longer in many physical stores and Mom and Pop dealers. Physical stores and Mom and Pop dealers had, in the past, provided a very important function. They demonstrated and explained our boats directly to customers in an environment where the customer could feel and touch the actual product. That experience has a whole lot of benefits.
If you compare the various ways we have sold our products…through dealers, through mail order, by catalogs, by ads, by phone, through our websites, through videos, through other people’s websites – each of these mediums have advantages and disadvantages. However, I have to say the advantages that the website brought, along with the other advantages of being on other people’s websites, resulted in the greatest change and growth of our business.
In 1997, another thing happened that changed the course of our business. A Korean lady named Kara called us, saying she represented a Korean company making supported fabric inflatable boats. She asked if they could quote making inflatable boats for us. We were dubious, but since we still were making plastic floorboards, we asked if the Korean company could make supported fabric boats that could use our plastic floorboards.
To make a long story short, in 1997 we began working on a new fabric supported series of transom boats that used the plastic floorboards we had first used with of GT-10 and GT-15 inflatable boats. We introduced the new fabric supported boats in 1998 and it turned out that the combination of our plastic floorboards and the Korean supported fabric boats produced really good transom boats that could take up to 30 hp engines at a quite reasonable price.
By this time, our Sea Eagle website was getting more elaborate and so we added 3 fabric supported transom boats to our lineup of 6 unsupported PVC boats. In the year 1998 our web sales went up dramatically and we also sold almost 1,000 fabric supported transom boats. So you can say that year we had a kind of double success.
In 1999, we added 3 supported inflatable kayaks and an interactive order cart. The kayaks were really a re-introduction of our original line of Explorer kayaks that we had first introduced in 1976. So, once again, by 1999, we were offering a fairly full range of supported fabric and unsupported boats. And the redesigned Explorer kayak also was an instant success.
So you can say from 1996 on we had a lot of new things going on. Not only did we go online and quickly expand our web sales, but by adding two new series of supported fabric boats, we greatly expanded our line of inflatable boats. By 1999, we had 15 basic inflatable boats. And as soon as the order cart was up running, our web sales went into overdrive. And by having our full range of boats online, we also attracted a lot of new online trade customers. By the end of 1999, our web sales went up to $746,000. At the time, web sales still only accounted for about 30% of our direct sales and in addition to that, we had developed a pretty nice trade business of about $1,500,000. This meant our Sea Eagle business was now over $5,000,000.
Thus, began a whole new stage and evolution of Sea Eagle Boats. Many other changes and product innovations were soon to come. To learn more about that you will have to wait until I finish Part III of the History of Sea Eagle Boats.