Private equity firm Apollo Global Management will take Rackspace private in the all-cash deal.
The web grew faster than stores for nearly two-thirds of Top 500 retail chains.
Web sales continue to outpace comparable-store sales at many of the nation’s biggest retail chains, and the trend is accelerating, according to an analysis of data for Internet Retailer’s forthcoming 2011 Top 500 Guide.
At 42 of 65 leading department store, specialty apparel, general merchandise and other chain retailers, or 64.6%, the growth online in 2010 exceeded the increase in annual comparable-store sales. The web also accounts for more than 30% of all sales at four big chains—Staples Inc., No. 2 in the Internet Retailer Top 500 Guide, Office Depot Inc. (No. 5), Williams-Sonoma Inc. (No. 26) and dELiA*s Inc. (No. 152)—while six additional chains, including Saks Fifth Avenue (No. 45), Urban Outfitters Inc. (No. 53), American Eagle Outfitters Inc. (No. 51), Recreational Equipment Inc. (No. 62), Coldwater Creek Inc. (No. 78) and The Talbots Inc. (No. 107)—reported that e-commerce sales generated more than 10% of sales last year.
A look at the leading chains shows:
- Web sales were 42% of total sales at Staples.
- The web accounted for 36.2% of annual revenue for dELiA*s.
- Web sales were 35.3% of total sales at Office Depot.
- The web accounted for 33% of total sales at Williams-Sonoma.
E-commerce continues to outperform same-store sales at many chains because shoppers are choosing to do more of their product research online and then use the speed and convenience of online retailing to complete a transaction, says Jim Okamura, managing director of Chicago retailing consulting firm Okamura Consulting.
“The chains are getting better at enhancing the user experience on their e-commerce sites and that’s accounting for more sales shifting from the stores to the web,” says Okamura. “Consumers know they can research product availability and price online and then go to the store, but once they are on a chain retailer’s site they’re choosing to complete their purchase online.”
The fact that web sales are outpacing the growth in annual comparable-store sales is not a new trend, but the growth online is accelerating, according to Internet Retailer’s forthcoming 2011 Top 500 Guide.
Specific results include:
- Ann Inc. (No. 122): E-commerce sales increased 55.8% to $189.5 million from $121.6 million in 2009. Comparable-store sales increased 18.7%.
- Express Inc. (No. 144): Web sales rose 60% in 2010 to $147.5 million from $92.2 million in 2009. Comparable-store sales increased 7%.
- Kohl’s Corp. (No. 43): A growth in web sales of 51.3% to $743.4 million from $491.5 million in 2009. Comparable-store sales increased 4.4%.
- Abercrombie & Fitch Co. (No. 65): A growth in web sales of 41.3% to $352.5 million from $249.4 million in 2009. Comparable-store sales increased 4.4%.
The faster growth of the web compared with stores is getting the attention from top management at several leading chains, says Okamura. “There’s a return on investment mandate for spending more on the web channel at many of the big chains,” says Okamura. “More chains see their growth coming online, and that’s where they are committing more resources.”