The e-retailer spends at least 50% of its monthly display ad budget on the highly targeted, data-driven—and often cheap—ad placements using programmatic platforms.
Over a decade, five Top 500 merchants have annual compound growth rates better than 50%.
There are 146 retailers that were ranked in the Internet Retailer Top 300 10 years ago that are in the newest Top 500 list, which ranks the largest North American web merchants on their annual web sales.
But there’s also been lots of change over a decade and a big variation in the performance of the original Top 300 merchants.
Among all Top 500 merchants, Urban Outfitters, No. 48 in the 2013 Internet Retailer Top 500 with 2012 web sales of $663.3 million, was the Top 500 retailer posting the best annual compound growth rate over 10 years at 65.1%. Urban Outfitters was followed by Ann Inc. (No. 88) at 56.4%, The Children’s Place Retail Store Inc. (No. 112) at 51.5%, The Estee Lauder Cos. Inc. (No. 59) at 51% and The Talbots Inc. (No. 146) at 49.5%.
Among the Top 500 retailers with the worst compound annual growth rate are Shop PBS (No. 499) at a negative 58.4%, Franklin Covey Products LLC (No. 423) at minus 26.6%, RadioShack Corp. (No. 296) at negative 21.7%, Books-A-Million (No. 453) at minus 4.5% and Bellacor Inc. (No. 382) at minus 4%.
Of the original group of merchants still ranked in the Top 500 over a decade, it’s been a willingness to try new technology and marketing initiatives such as social media that have kept web merchants such as FragranceNet.com Inc. (No. 153) growing and able to compete against bigger rivals such as Estee Lauder, which grew web sales year over year about 24% to $512 million from $414 million.
For FragranceNet.com, which at nearly 39% has posted the best compound annual growth rate for the last decade among the web-only merchants ranked in the Top 500, social media marketing is a top priority, especially as FragranceNet.com diversifies beyond just selling perfumes and colognes into new beauty and skin care products, says CEO Jason Apfel. “We’ve survived for 16 years as an online retailer against a lot of bigger companies because we always been really good at getting up close and personal with our shoppers, but we’ve got to get social media just right,” he says. “It’s how our customers are communicating.”
Today revenue from social media is a small but growing part of FragranceNet.com’s annual web sales of about $145 million, although Apfel won’t disclose a specific figure. Overtime, FragranceNet.com is making better social media promotion and integration a big part of its upcoming web site redesign. When the new design is ready in time for the holiday shopping season, the new product pages will feature new social functionality on most, such as photo walls, interactive questions and answers, and other features.
FragranceNet.com will also integrate its product pages more closely with Facebook, Twitter and Pinterest, a fast-growing social network where online consumers “pin” images from around the web to “boards” that they create. “We will use our site redesign and social media to promote a competitive advantage we think we have, which is providing deep content and lots of online beauty advice to shoppers,” Apfel says. “We’ve been around this long because we’ve gotten pretty good at getting to know who our customers are and how they relate to us, and social media will only deepen that relationship.”
More on Top 500 retailers, metrics and analysis is contained in the 2013 Top 500 Guide.
To read previous Top 500 Insider stories, click here.
The 2013 Top 500 Guide is available in three formats: print, digital and as part of the all-new and completely updated Top500Guide.com. Information on how to order the new 2013 Top 500 Guide is available here.