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Back Bay Company Wayfair To Merge 200 Online Storefronts

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BOSTON (CBS) – Most consumers probably never heard of CSN Stores, and don’t know the online home goods retailer under its new name, Wayfair Inc., either.

At least not yet.

But the Boston-based company – which until now has operated hundreds of largely separate e-commerce sites – has some cause to think it has a shot at becoming the Amazon of home goods as it brings all the sites together under one brand.

Wayfair expects revenue of more than $500 million this year, up from $380 million in 2010; it already ranks No. 2 among home-oriented e-commerce firms by sales, behind Williams-Sonoma and ahead of Crate & Barrel, according to Internet Retailer magazine.

“People have moved away from using search engines to find stuff to going straight to a few branded destinations on the web,” said Steven Conine, chief technology officer at Wayfair, a name the company adopted Sept. 1.

“If someone can take that slot in the market, as the great destination for home on the Internet, we realized we probably had the best chance of doing it.”

As CSN Stores, the company never gained much name recognition due to its focus on pushing niche categories.

The company sells goods through 200 different domain names – from cookware.com to strollers.com to theheadboardstore.com – that have aimed to make the most of web searches for specific keywords.

The sites get 2.5 million visitors a week, and the company believes it offers the largest collection of home goods available.

Executives said the company has done plenty of advertising, but it’s been spread out among the different brands.

Though some efforts have been taken to tie the sites together, it became clear that a single brand was needed to take the company up a level.

So starting this week, the company planned to begin re-directing its domains to corresponding departments on the new Wayfair.com.

And therein lies what may be the company’s biggest short-term challenge: getting Google and other search engines to steer consumers to the new site.

Search engine traffic remains a huge driver for the company, but Google will likely stop showing results like strollers.com within days of re-directing the domain names to Wayfair, CEO Niraj Shah said.

“There’s a significant amount of risk around how long certain aspects of the change take – how long it takes for the Wayfair site to be viewed as an authoritative site, how long does it take for all the pages to get indexed there,” Shah said.

“You just don’t know. Does that happen in weeks, months?”

Conine said the company plans to re-direct the sites gradually, taking the approach it has used all along – do lots of testing, figure things out along the way.

That’s essentially how the company got going, in 2002, in Conine’s house in the South End.

The first site was tvstands.com, which Conine and Shah – who previously had two companies together – felt was so specific that it couldn’t help but draw in web traffic.

The second site wasn’t part of the original vision, though.

After seeing steady sales for TV mounts on the initial site, the company started up the obscure-sounding mountsandmore.com. And the site did well – well enough that it’s still active.

Another favorite oddity that’s still up is everyatomicclock.com.

“We launched a lot of specific sites just to test certain hypotheses,” Conine said, noting the company owns 1,000 domain names in all.

“We have kind of a Darwinian approach to the business.”

The company’s growth into an e-commerce giant in this fashion is noteworthy, said Ray Wang, principal analyst and CEO of Constellation Research Group.

“Very few have been this organic,” he said.

But Wang agreed that transitioning to a single brand at this point is crucial, even if there are search-engine risks.

“People don’t want to go to a million different sites,” he said.

“You ultimately have to aggregate your e-commerce properties, or you can’t scale.”

As Wayfair, that scaling process will remain just as Boston-centric as it always has been, Shah and Conine said.

Headquartered in a 25-story Back Bay office tower, the company now occupies 10 floors.

The Boston office currently employs 700 and is expected to reach 800 by the end of the year, Conine said, with hiring taking place across the board.

Kyle Alspach of the Boston Business Journal reports

Conine said Wayfair has no desire to move the headquarters out of downtown Boston.

The company also operates two U.S. warehouses, in Kentucky and Utah, though many of the company’s products are shipped directly from manufacturers.

Wayfair took its first-ever venture capital round in June, a handsome $165 million financing from Spark Capital, HarbourVest Partners and Great Hill Partners, all of Boston, and Battery Ventures of Waltham.

The ultimate plan is for the company to go public, though it’s still probably years off, Conine said.

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