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Following is an email Q&A with Adrian Yearwood of vdeep.com. While vdeep.com is in Beta, the company has made some impressive progress. This post is not a joke, and I encourage you to read the Q&A as Adrian makes some insightful comments. vdeep.com, is located across the pond in the UK…

What is your background? Do you have any experience with the adult products industry?
There are two partners in vdeep.com: Adrian Yearwood and Benjamin Johnson, we are both recent graduates 2003. Upon gradating from university we lunched an online store selling contemporary fashion jewelry, but were focusing much of our time researching launching an online advertising service. In late 2004 we got a taste for the shopping comparison market and we initially set about considering the launch of new comparison engine, at this time the major sites where really starting to take off and with more research we found that there where many small comparison sites all trying to gain merchants and consumers in the same market, but investigation showed us that no one was really serving or focusing on the adult market, this market for all intents and purposes is not catered for.

Our experience of the industry is increasing day by day, but fundamentally we are an advertising platform whose customers happen to be in the adult products and services industry. We are here to provide a cost effective method of advertising to adult merchants and a central place for consumers to make an informed purchase decision.

One of the key differences between the adult products industry and the general products industry is the availability of information or official information, adult goods have more in common with the normally ungrouped soft goods sections such as lingerie than hard goods sections such as televisions.

Who else is on your team? How many employees?
Our current team consist of the two members mentioned above. Benjamin Johnson is in control of development, decisions are a shared task but the actual development and implementation falls to him, while the business, marketing and merchant communications side of the business falls to Adrian Yearwood.

We intend to take on board staff members as and when we are able to and as they are necessary, we are also looking into outsourcing and venture capital.

What is the size of the adult shopping industry in the UK?
There is little information available about the UK’s adult industry size and its financial value. The problem is the fact that many adult companies are privately owned and so do not have to release financial information. Based on research an estimate of the industries annual value for 2004 was £750 million ($1.3 billion) in retail value. This was quoted by Mike McCann, the chairman of the Adult Industry Trade Association and featured in a Telegraph article 2004. The value seems to focus mostly on adult toys, clothing and novelties.

How many unique products are listed on vdeep?
Currently we can’t say how many of the products on our site are unique as we are working on a new method to group products together. Our initial product grouping method relied on the availability of manufacturer product numbers (MPNs) but we soon realised once we had created the system that these are not so readily available from many adult retailers and many have taken to using there own internal codes for products and product names. We are now working on a new method to group all products from lingerie and lubricants to sex toys and DVDs, this is proving extremely complicated and is taking considerable effort and time. For this reason until we actually group our products the actually number of unique products is unknown, but the total number of products listed 60,000 and rising as we bring more merchants on board.

How many unique merchants are on vdeep?
We have been in beta now for approximately 8 weeks and have 58 unique stores listed we have been selective about which merchants we have chased up as the system is still under development and there are many other tasks for us to address.

The number of merchants listed will increase as we more heavily start to contact more sites and are able to actually provide facts and figures on our conversion rates. Many merchants are sceptical about coming on board and many do not have the in house skills required to build a feed and are currently not prepared to out source the skill needed.

The number of merchants listed will increase as we more heavily contact more and are able to actually provide facts and figures on our conversion rates. We have noticed that a few merchants that where not previously interested in coming on board or who where previously sceptical have contacted us back asking to be listed, I believe they have kept an eye on us and have seen our merchant list grow and their confidence to list increases as we prove ourselves more. This was proven a couple of weeks ago when sexshop365 and sextoys.co.uk decided to come on board, they are two of the biggest players in the sex toys online UK market, we have also been in touch with Ann Summers who also showed an interest and asked be to be contact in due course.

We have also improved our system to handle many or the different data feeds formats available this again was a reactive move on our part to accommodate those merchants that already had data feeds but were not prepared to take the time to produce one according to our requirements until we prove our worth. We have directed some merchants to your article on the importance of producing a good data feed.

What kind of traffic are you getting?
Currently because we are still in beta we have not implemented any marketing yet and are only listed in a few directories, so the traffic levels are low, but like our product count they are rising each day. Fundamentally we will see a large increase in traffic once we start to advertise. We have currently decided to start some basic advertising once we have our product grouping feature in place and then move more heavily as we implement our narrow down filtering to a specific product via its features. We have a number of additional features many of the features offered by the larger comparison sites to the general market are also relevant to the adult market such as reviews, wish list, merchant admin interface and many more.

What do people think of adult oriented sites in the UK? In the US, no one talks about it, but the online adult industry is obviously huge. Do you think people in the UK are more or less open to adult oriented sites?
Like in most countries, it often depends who you speak to. In general the UK is very open minded even among many of the older generation. Some large retailers like Ann Summers have brought sex shops out of back alleys and onto the high street and two major UK chain stores Debenhams and Boots are entering the industry. The internet is allowing consumers to make purchases discreetly, and thanks to hit shows like Sex in the City the adult industry is growing considerably.

Also I am sure you have noticed our site is designed to be easy on the eye, we do not have large sexual graphical images on the front page, or things that either sex or persons of any sexual orientation might find offensive.

Do any of the European comparison engines list adult products? Your FAQ section says no, but I know the comparison engines in the US do list adult products.
“We are the only dedicated shopping comparison site” other shopping comparison sites such as Shopzilla may carry some adult products but not with the dedication that we do. There is a good reason not to promote these sections actively. If they did they could soon find themselves on many organisations banned URL list which would impact their bottom line.

Shopping.com, Kelkoo and Pricerunner have all informed us it is against their policy to list adult toys. There are smaller, less well known sites that also display a few adult products but known that dedicate to it.

Also there is an advertising side, while a few of the other comparison sites list adult products none of them have extended any effort to advertise this fact. These sections are also not as polished as their flagship categories and are mostly lacking any ability to compare prices for adult products. Something that we intend to overcome.

vdeep.com is free for the first 30 days, how much does it cost after 30 days? Is it a pure auction site like Google Adwords or Yahoo Search Marketing or are there price floors - minimum bid amounts?
The 30 days free is more a minimum free period, some of our merchants have had over 60 days free service.

We are currently in beta so we are constantly testing the system and making improvements along with adding more features to help us produce the best possible return on investment (ROI) for our merchants. While we are in our beta period we are offering our services totally free of charge. This is a case of “we scratch their back they scratch ours”, we are able to test the stability of our system and its features by bringing on board merchants and in return any traffic we send them during this time is totally free. Most importantly this is beneficial to our merchants because they are helping us improve the very system we are using to advertise there products, meaning we improve the consumer experience which in return lead to better conversions for our merchants, so for them is a win, win situation.

We intend to put the full force of our marketing in place as soon as the beta period ends. At this point we will be happy with the system and feel it is in an appropriate position to move foreword. This means that over time our merchants will see an increase in the traffic we send them.

All this has been explained to each of the merchants we have listed and we are very happy with the relationships we are building with them. We have had several suggestions given to us and we have either implemented them, or made a note as a future feature or improvement.

We have decided against a bidding for position model and have opted for a fixed fee across all our categories, initially this fee is set at 30p (0.3 GBP) cost per click, this will adjusted as we gather more information about conversion rates.

With adult sites, there are a lot of ‘curiosity’ clicks which leads to low conversion. How do you plan to deal with this problem?
This is a problem we are fully aware of, and it has been mentioned as a concern by a couple of our merchants, currently we have no conversation data to work with so we are slightly limited.

We try to offer consumers all the information they would want to know before making a purchase and we also offer large picture of products with out the need to click through. We have also implemented a store information section so consumers can see what payment methods are accepted and the method delivery used, they can also see what the billing name is used and if discreet packaging is used, this information is important to many consumers.

Unfortunately we cannot control what information merchants provide us with, we ask for large pictures and full descriptions, stock and shipping information. We expect the quality of the information we supply to improve over time as we group products together and obtain information from other sources.

How much money did you put into the vdeep to start it up?
To date the major cost of vdeep.com has been the time to develop vdeep.com, research and acquire merchants, this is 16 hours a day and a year in the making and while we know it will never be a finished product because of the constant evolution of what is possible it is still many mile stones from being where we would like it to be.

The initial heavy costs will be in the forms of advertising, this will include everything from SEM like PPC keyword engines like Google and Overture, to affiliate programs and SEO and copywriting among other things.

We are going to be potentially looking for venture capital investment to help to speed up our growth and market reach.