Despite its name, e-commerce now accounts for about 50% of all sales at 1-800 Contacts Inc.
In 2005 e-commerce sales rose 12% to $119 million from $105.8 million in 2004. In 2005 total sales grew just 4% to $238 million from $211.6 million in 2004.
The company says a number of factors account for what it sees as a modest growth in sales, including disruptions in online order processing that were brought about by a changeover to a new e-commerce platform. “Our sales have been softer than anticipated. In addition to lost sales resulting from the disruption to our web site when we upgraded, we believe two external factors have affected our ability to acquire and retain customers—the growing problem of ‘doctors only’ lenses and the prescription verification practices of another online seller,” says CEO Jonathan Coon. “The impact of these external factors is difficult for us to quantify.”
With an inventory of more than 20 million sets of lenses, 1-800 Contacts, No. 72 in the Internet Retailer Top 400 Guide to Retail Web Sites, has built a direct marketing program that fulfills almost 95% of all orders within 24 hours. The company also has delivered more than 11 million orders to more than 5 million contact lens customers since its inception in February 1995.
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