SkyMall Inc. (Nasdaq:SKYM) launched skymall.com, a wholly owned subsidiary that will focus on e-commerce, direct online sales, and distribution of its consumer products to online resellers. By late morning Thursday, the company’s stock soared 30% on this news.
SkyMall is best known for its in-flight product catalogs. In addition, the company has made a splashy debut into online sales, announcing news on December 28 of a 600% increase in Internet sales for 1998 over the prior year. However, a few days later, the stock came tumbling down by 25% on news that management exercised stock options in a buyout of 66% of the company’s stock. SkyMall expects sales for fiscal 1998 to reach approximately $2.1 million.
Robert M. Worsley, SkyMall’s president and chief executive officer, reports that the company has seen a tremendous upsurge in e-commerce activity over the past quarter. “The goal of our new [skymall.com] subsidiary is to continue to grow to accommodate increasing traffic to our site,” said Worsley.
In a related announcement today, SkyMall also announced the appointment of sales vice president, Sandy Goldman, formerly CEO of pix.com, and senior vice president and general manager of WaveTop, a consumer data broadcast product line of WavePhore Inc. (Nasdaq:WAVO). In addition, he has held senior executive positions at Turner Broadcasting Systems Inc. and Actmedia (acquired by News Corp.).
Beyond the News
In December, Skymall.com reported a record 15 million hits to its site, with Internet sales representing approximately 8% of the company’s total revenue. The company’s in-flight catalogs are available to 400 million airline passengers each year. SkyMall markets and sells a variety of consumer merchandise from participating merchants, including major catalog companies and specialty retailers. Through another subsidiary, Durham & Company, SkyMall offers promotional marketing merchandise to corporate consumers.