Pawan Verma joins Foot Locker as its new chief information officer.
Lower conversion rates and the company’s rebranding as O.co contributed to slumping revenue.
A combination of lower conversion rates, fewer new customers and the company’s rebranding as O.co caused revenue to fall in the third quarter for Overstock.com Inc.
For the quarter ended Sept. 30, Overstock, No. 27 in the Internet Retailer Top 500 Guide, reported:
- Sales decreased 2.2% to $239.7 million from $245.0 million in the third quarter of 2010.
- Sales and marketing spending decreased year over year 11.5% to $13.8 million from $15.6 million.
- Technology expenses grew 21.1% to $17.2 million from $14.2 million.
- General and administrative expenses grew year over year 4.1% to $15.3 million from $14.7 million.
- Net loss was $7.8 million compared with a net loss of $3.4 million in the prior year.
“The primary reasons for shrinking revenue were visits to our web site were up slightly, conversion rates were lower, resulting in fewer orders, and an 8% decrease in new customers compared to last year,” says CEO Patrick Byrne. “The decline in revenue is partially the result of a decrease in site-wide promotions and e-mail and affiliate channel couponing we did to shift resources to promoting our Club O loyalty program. We also believe that our current efforts to rebrand ourselves from Overstock.com to O.co may have contributed to the decline in revenue.”
In January Overstock began using the domain O.co, directing consumers who type in O.co to the web-only retailer’s e-commerce site, Overstock.com. The company says the new name represents a step in Overstock’s effort to brand itself around the letter O.
For the first nine months:
- Sales decreased 0.1% to $740.2 million from $741.0 million in the first three quarters of 2010.
- Sales and marketing spending decreased year over year 2.5% to $42.9 million from $44.0 million.
- Technology expenses grew 19.6% to $50.6 million from $42.3 million.
- General and administrative expenses grew year over year 13.4% to $50.0 million from $44.1 million.
- Net loss was $16 million compared with a net loss of $970,000 in the prior year.