The world’s largest retailer will end free shipping for online orders under $50 Canadian starting April 2.
The retailer reports a $1.7 million net loss, though.
Web sales for CafePress Inc. increased 11% in the second quarter compared with the same period last year.
The online-only retailer sells customized products such as T-shirts, coffee mugs, stationery and photo gifts. It said gains came from such new sales channels as its Great Big Canvas division listing products for sale through the e-commerce site of web-only home goods retailer Hayneedle.com. CafePress also doubled the number of CafePress products available through Facebook Inc.’s Facebook Gifts program.
For the quarter ending June 30, CafePress, No. 110 in the 2013 edition of the Internet Retailer Top 500 Guide, reported:
- Web sales increased 11.3% to $52.4 million from $47.1 million in Q2 2012.
- Net loss was $1.7 million, compared with a loss of $260,000 in Q2 2012. Continued acquisition-related costs triggered much of the loss, the retailer says. For instance, CafePress bought photo gift maker EZ Prints Inc. for $30 million last fall.
- Spending on technology and development increased 59.4% to $5.1 million from $3.2 million.
- Spending on sales and marketing increased 20.3% to $14.2 million from $11.8 million.
- The average order value stood at $34, compared with $52 a year ago. CafePress attributes the decrease to the smaller order sizes coming from EZ Prints’ sales to professional photographers and other businesses. Excluding EZ Prints, the average order size during the second quarter was $52, the same as a year ago. EZPrints’ focus is on relatively low-cost photo gifts, usually priced under $10.
- The number of orders grew year over year 66.2% to 1,477,063 from 888,439, including EZ Prints orders.
“CafePress demonstrated solid execution during the period highlighted by another quarter of strong contribution from corporate partnerships,” says Bob Marino, CafePress CEO. “We believe we are well positioned for a strong second half of the year with a solid pipeline of new products, partnerships and initiatives that will set the stage for the holiday period.”
The Q4 holiday season historically stands as CafePress’ biggest quarter for sales, and the e-retailer says it expects Q4 will account for an even greater percentage of total sales than in previous years, thanks in part to contributions from its acquisitions. It says it expects to generate roughly $95 million to $104 million in Q4 this year, or about 38% of total sales. “Our outlook for the second half reflects our ongoing view that a greater percentage of CafePress’ revenue and profit will occur in the fourth quarter compared with our normal patterns,” says Monica Johnson, chief financial officer.
For the six months ending June 30, CafePress reported:
- Web sales increased 20.6% to $104.9 million from $87.0 million during the same time frame in 2012.
- A net loss of $5.7 million, compared with a loss of $804,000 a year ago.