In its second-largest acquisition, Amazon buys the company for $970 million.
The 5.1% conversion rate for catalog and call center retailers grows from 4.7%.
Catalog and call center retailers in the 2013 Internet Retailer Top 500 guide outperform retail chains, manufacturers and web-only retailers in one important e-commerce metric: conversion rate. As a group, they have the highest average conversion rate of 5.1% in 2012, an improvement from 4.7% in 2011.
Indeed, catalog and call center retailers have consistently had the highest average conversion rate among the merchant types in the 10 years since the publication of the first Internet Retailer guide to e-commerce, called the Top 300 in 2003.
One big reason is that these retailers typically send catalogs focused on specific products, such as gifts or pet supplies, to consumers who buy those products. “Because we have specifically targeted push campaign, we are reaching a highly targeted group,” says Paul Lazorisak, vice president of customer marketing at Harry and David Holdings Inc., a gift retailer that is No. 132 in the Internet Retailer Top 500 guide. That means consumers who view a Harry & David catalog often have every intention of making a purchase when they visit the retailer’s e-commerce site, he says.
“The catalog is the largest single driver of traffic to the web,” says Stephen Lett, president and founder of Lett Direct Inc., a direct marketing consultancy. “While the Internet has become the preferred way to place an order, consumers still prefer to shop from a print catalog.”
In 2012, the average conversion rate for web-only retailers was 3.4%; retail chain, 2.7%; and consumer brand manufacturers, 2.2%.
While catalog and call center retailers enjoy a chart-topping conversion rate, their sales growth is not as fast as that of some other types of merchants in the Top 500. As a group, catalog and call center retailers grew 320.85% over the past decade, generating 2012 sales of $24.62 billion, up from $5.85 billion in 2003. That places those merchants behind web-only Top 500 retailers, which grew 842.0% over the 10-year growth period, and retail chains, whose web sales increased 360.6%. Catalogers only bested consumer brand manufacturers’ growth, which grew 201.5% for the 10-year span.
The story is similar for 2012 compared with 2011. Total 2012 sales for catalog and call centers, meanwhile grew by 9.9%, while web-only retailers, with $91.56 billion in 2012 sales, lead the Top 500 with a 24.8% increase in sales from 2011’s total of $73.39 billion. Catalog and call center retailers suffered the largest decrease in e-commerce market share among the four types of merchants, losing 6.5% in 2012 compared to the prior year, while web-only retailers—aided by Amazon.com Inc.’s continued strong growth—gained 6.3%.