July 22, 2009
By the ZippyCart Shopping Carts Content Team
Today is the day that publicly traded companies around the US announced their earnings from Q2 of 2009 to their investors. While the majority of e-tailers are not large enough to be a publicly traded company, it’s helpful to compare other eCommerce stores to the ones that set the bar. Amazon.com and Overstock.com are two such bar setters, having taken the online storefront from infancy to the popularity it holds today. Because Amazon will not make their phone conference public until tomorrow (July 23rd 2009), this story will be split into two segments. This segment will focus on Overstock.com.
Overstock.com is an online storefront with a focus on selling a company’s excess products at whole sale, or clearance level prices. In an economy where finding a deal is a necessity, Overstock seems to be benefiting. While revenue was down 6.7% year over year, profits rose by 8.1% in Q2 of 2009 in comparison to Q2 of 2008. Gross margin improved by 3% which explains the upswing in profit even though revenue sank. Another win for Overstock was a 22% year over year decrease in marketing dollars. Finally, Overstock brought in $4 million in adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) and has a trailing twelve month EBITDA of $18.1 million.
Overstock’s success comes from many contributing factors including ease of checkout, a thorough search and browse function, and customer memberships to name just a few. The company also puts a great deal of focus into email marketing by sending loyal customers special coupons and notices about weekend sales. A majority of these emails are personalized based on what that customer previously purchased, giving customers a sense of importance. The user interface of the store is simple with a general ease of navigation, which also helps a user move from just browsing to buying. Consider these factors when optimizing your own online storefront.
To view the full earnings report, click here.
See Part 2 Here
Scott is an avid fan of all things ecommerce. His claim to fame is that he "puts the Zip in ZippyCart." He considers himself the world-wide number one reader of TechCrunch, C|Net, and The Ecommerce Times. Scott has worked in the SEO industry for many years, but found himself always shifting his focus to review sites and ecommerce blogs. When we decided to start the ZippyCart Ecommerce news, Scott was an obvious fit. He handles most of our OpEds as he is a very opinionated guy. Scott is also our Twitter guy, so don't hesitate to send him a tweet if you see him online.
