November 24, 2010, 4:02 PM

eCost.com’s third quarter web sales fall

Spam filters are still blamed for eCost.com’s second consecutive quarterly sales decline.

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Online retailer eCost.com Inc. reported a sales decline in the third quarter and, as in the second quarter, parent company PFSweb Inc. says spam filters and blocked e-mails are the reason.

“During the third quarter, we spent considerable time enhancing eCost.com’s sales and marketing program to increase its effectiveness against the ever evolving e-mail filtering algorithms being deployed by several Internet/e-mail service providers,” says PFSweb chairman and CEO Mark Layton. “While this issue negatively impacted our revenue during the quarter, I am pleased to say that by the end of the third quarter we were experiencing higher success rates when advertising to this portion of our customers than we had in the summer of 2010. We expect these efforts to be ongoing as the e-mail filtering algorithms will continue to adjust.”

ECost.com, No. 158 in the Internet Retailer Top 500 Guide, also attributed a 20.2% decline in Q2 2010 web sales, to $16.2 million from $20.3 million, to spam filters and undelivered e-mails.

For the third quarter ended Sept. 30, eCost.com reported:

  • Total sales of $16.6 million, a 19.4% decrease from $20.6 million for the same period in 2009.
  • Net loss was $590,000 compared with a net loss of $257,000 in Q3 2009.
  • Total number of customers increased 8.5% to 2.17 million from 2.0 million in the prior year period.
  • The number of active customers decreased year over year 7% to 208,582 from 224,297.
  • The number of new customers declined 10.4% to 33,230 from 37,079.
  • The number of orders decreased year over year 28.2% to 53,652 from 74,770.
  • Average order was $300, compared with $271 in the prior year quarter.

For the first nine months of 2010, eCost.com reported:

  • Total revenue of $52.9 million, down by 14.4% from $61.8 million for the same period in 2009.
  • Net loss was $1.7 million compared with $1.2 million through nine months of 2009.
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