Buy.com reports record e-commerce sales
Pursuing its quest to compete with Internet retailing heavyweight Amazon.com, Buy.com Inc. used a revamped web site that includes video product reviews, comparison shopping and Google Checkout to attract more shoppers and tally record revenue. The company announced 2006 sales of $462 million, up 34% compared to 2005.
Buy.com, which is No. 38 in the Internet Retailer Top 500 Guide, also is doing more brand management and is using web tools such as rich video product reviews to generate traffic and sales, Neel Grover, president and CEO, tells Internet Retailer. Buy.com’s in-house production team developed BuyTV, which features a new 30 minute show each week that highlights product segments. Shows include presentations from manufacturers, authors and artists.
Another new tool is a price comparison shopping site that enables a shopper to click through from Buy.com to a competitor’s site if they find a lower price, Grover says. “If someone is cheaper than us on a product from a name brand retailer, the shopper can go directly to that site and buy from them. But most often we expect they will see we are the low-cost leader.”
Adding Google Checkout as an alternate payment method also has gotten Buy.com a little more notoriety on Google when shoppers are searching for products, Grover says.
Buy.com also has sold 9% of the company to Clearlake Capital Group in a move to pay off some debt and invest in marketing, along with potential acquisitions. “We cleaned up a little debt on our balance sheet and last year started offline branding to go hand-in-hand with online branding,” Grover says. “We traditionally were online only but last year we developed some TV commercials and we’ll do more of that along with marketing through Google and other online vehicles.”
The company contemplated going public, but heeded the attention of more than one private equity firm. “We looked at going public but now that we’ve found Clearlake and are debt-free, we’ve decided that staying private is the best way to go,” Grover says.
Buy.com finished 2006 in high gear, with Q4 2006 net revenue of $162 million, an increase of 45% over the same quarter in 2005. Net income for the quarter was $8.8 million.
The company also reports record net income of $722,000 for first quarter 2007, excluding $154,000 of stock-based compensation.
Buy.com boasts more than 10 million cumulative customer accounts and focuses on providing its customers a broad selection of high-quality technology and entertainment retail goods.
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