A visit to the home page of Adam & Eve (www.adameve.com) is like a trip to the erotic Mall of America. The Web design is cold-milk clean, the navigation Amazon.com-professional, and but for discreet glimpses of flesh, it takes a close perusal of the actual products to see just how completely Adam & Eve feeds the vast carnal appetite of today’s sex-obsessed consumer.
Founded by Phil Harvey in 1970, Adam & Eve is America’s premier sex toy store, and more. In addition to serving the novelty needs of domestic and international customers for over 30 years – through a Web site portal that leads to numerous niche domains, a handful of well-trafficked brick-and-mortar stores, and the targeted mass circulation of specialized catalogues – Adam & Eve also branded themselves as bona fide content producers back in 1991 after acquiring Los Angeles-based Ultimate Pictures from director Nicolas Steele and his partners. To this day, Steele continues to be the premiere director for Ultimate Pictures, one of Adam & Eve’s production brands along with Adam & Eve Productions. In 1991, they debuted their first movie, Dinner Party 3, and have since produced over 400 titles. They now release about 130 videos a year, all available through VoD (Video-on-Demand), and currently also claim the distinction of having procured the gorgeous Carmen Luvana as a contract performer.
But Adam & Eve is perhaps best known for its sex toys/novelty/DVD/video retail sales business, and from all accounts no one provides better or more products or services. Through their various distribution channels, the company supplies its base of 6 million customers with every conceivable erotic product known to man and woman, from clothing and vibrators to jewelry and books, from lotions and oils to vibrating nail polish and orgy sheets, to name but a few.
According to Chief Technology Officer Sean Trotter, “We have over 12,000 products available online, and if you send in an order today, it’s going out today.” He adds that sex toys were the predominant sellers for a long time, but video sales have pulled about even with the toys, and now account for half of sales per year.
Trotter stresses that as much as the company has grown over the years, now clocking in at over 400 employees, its core business values haven’t changed much. “We’re really big on our standards,” he insists. “Every movie we sell goes through an internal review process, and then gets sent to a board of therapists. If they find anything questionable – choking, bondage, beating, smacking, or any sex that doesn’t look consensual – they reject the movie and we aren’t allowed to ask them why.”
“We practice those same values on the Web,” he says. “We’ll show some pubic hair and nipples, but no penetration or pink. Of course, when you log in it is no-holds barred.”
Their customer service ethics follows suit. “Our customers’ names are not shared or spammed,” says Trotter. We don’t sell email addresses, we don’t rent them, and we don’t borrow them. If we ask about a third party, the third party is one of our companies. For example, if you give us permission to have a third party send you offers, you’re going to get it from one of our brands, like VideoGold or VideoMail, or any one of our littler brands; but not from another company.”
He adds that the company’s attention to customer needs is precisely why they’ve risen and stayed at the top. “If you’re a first-time buyer,” says Trotter, “and you have no minimum purchase at all, you’re still getting Wall-to-Wall Skin, which is one of our comps, for free. On our home page today, you’ll see DVDs for $9.95, vibrators for 50 percent off, lots of specials and clearance items. Also, all our customers get a free gift, so no matter what they buy, as long as it’s over $17, they’re going to get a free DVD or toy of their choosing when they place their order. These are some real things that people love.”
“Now, I can’t say this as a fact,” he says, “but I’ve heard some of my top affiliates tell me this at conventions that we convert for them better than any other Adult store in the world that they’ve ever tried. So even though I don’t know that for a fact, we do know that there aren’t any other companies out there giving away the free gifts and having the promotions we have.”
According to Trotter, 1997 was the first year Adam & Eve went online, with $600,000 in sales. They did $30 million in sales in 2003, and are projected to do still better this year.
Basically, Adam & Eve attracts customers by utilizing catalogues, brick-and-mortar stores, and the Internet. “We see the Web becoming more prominent for order taking,” said Trotter, “but our catalogues are still the major force in driving traffic to our Web sites. Currently, 40 percent of our Web buying patterns are from our catalogue-based sources. We can mail up to 6 million people at a time, but generally narrow that down by mailing to different selects. A catalogue goes out every two weeks, 30 million a year, but that’s just our House catalogue. We also have our Prospecting catalogue, for people who are prospective customers, and our Last Chance catalogue, for people who are not buying. We also have Mahogany Desires for people interested in buying black movies and sex toys, and AdamMale for our gay division.”
“We opened our five stores in 2000,” he explains, “to get more new customers to the catalogues and to the Internet, but also give people a place to visit us in person.”
Adam & Eve also has a very robust affiliate program, called AdamEveCash (www.adamevecash.com), with just over 6,000 affiliates, according to Trotter. “But if you’re not active and haven’t had a sale in three months,” he says, “we’ll delete you, or else I would have a list of 200,000 affiliates. So we only keep the ones that actually perform. We send out about $345,241 a month in commissions to our affiliates, and on average, 34 percent is the average commission paid out to an affiliate.” This last figure pertains to retail affiliates.
Trotter details the retail affiliate payout structure: “Basically, it’s a sliding scale based on total sales calculated on the fly. If you sell from zero dollars to $10,000, you make 20 percent commission, 5 percent on referral commissions, $5 on every webmaster that signs up, and $1 on every new customer you send us. This is only for sex toys, videos, and stuff like that. From $10,000 to $25,000, it’s 25 percent commission, and from $25,000 and up, it’s 35 percent.
“For example,” he says, “if you’ve been an affiliate with me since January, and yesterday you were at $24,999, and today you sold something worth a dollar, you’re commission goes up. Then, every year you go back to zero on your anniversary.”
The membership and VoD Web site commission structure is much simpler. “It’s 50 percent on the initial sign-up and then 10 percent every month thereafter,” says Trotter.
Retail affiliates either opt for a custom-designed store (www.adameveshops.com) or one that’s generically skinned to look like their own site. Either way, says Trotter, “If someone purchases from one of our stores, skinned or not, its our backend, our sale, and our data, which means we have a huge database [of customers.]
“When we build a custom store,” he notes, “we typically start at a percentage and then negotiate with the client. Each deal is different. To use ClubJenna as an example, they get a higher percentage because they also market the store throughout the year. But Carmen Luvana’s store gets a lower percentage because she doesn’t market; we do most of her marketing for her. Another thing we’ve instituted is a program where if you join, say, SunnyLeone.com, you’ll get an email confirmation offering you a free DVD from Adam & Eve. It’s an incentive to join her site, she gets new members and less chargebacks because they’re getting a physical product, and we’re getting another customer name, which is all we care about.”
“Our biggest competitors are MALLCom and PECash,” said Trotter, “but only for the build-your-own stores. For the fully customized stores, we have no competition. It just seems like no one else offers it.”
So what does the future hold for Adam & Eve? One thing’s for sure, they aren’t resting on their laurels. “We’re still growing and hungry,” says Trotter. “We go after everybody. If I go on the Internet, and I click on a site and see a store by a competitor, I forwarded it to one of my sales guys and say, go get the store. I don’t care what percentage you give them, just get the store.”