Pawan Verma joins Foot Locker as its new chief information officer.
The web-only retailer also spends more on search to deal with Google changes.
Overstock.com Inc. today reported an 18% year-over-year increase in revenue in the third quarter ended Sept. 30.
The web-only mass merchant, No. 31 in the Internet Retailer Top 500 Guide, said revenue growth came mainly from a 15.6% jump in average order size, to $170 from $147 in the third quarter of 2012. Overstock also reported a 2% increase in orders for the third quarter.
CEO and chairman Patrick Byrne also gave credit to retailer’s loyalty program, its price-matching program that targets Amazon.com Inc., and fulfillment. “In Club O, we built what we believe is the best, most generous loyalty program on the Internet, with free shipping, 5% to 25% rewards on products, and books priced at Amazon prices but with 15% rewards, all for $19.95 per year,” he says. “Our Club O customers are rewarding us with their business. In addition, with the opening of our new warehouse in Pennsylvania, we are now providing even faster delivery to our customers on the east coast.” The Jonestown, PA, distribution center opened earlier this month. It is the e-retailer’s third distribution center.
For the third quarter, Overstock reported:
- Net revenue of $301.4 million, an 18.0% increase from $255.4 million in the same quarter a year ago;
- Net income of approximately $3.5 million, up about 29.6% from $2.7 million;
- Gross margin of 19.6%, versus 18.2% a year ago;
- Sales and marketing expenses of $22.5 million, an increase of 51.0% from $14.9 million. Overstock said it spent more on paid search to combat a decrease in natural search rankings due to Google Inc. search algorithm changes.
- Spending on technology of $17.3 million, up 7.5% from $16.1 million;
- General and administrative expenses of $16.0 million, an increase of 15.9% from $13.8 million;
- 88.2% of revenue came via Overstock.com’s fulfillment partners, up slightly from 86.6% last year; direct sales by Overstock accounted for 11.8% of Q3 2013 sales.
For the first three quarters of 2013, Overstock reported:
- Net revenue of $906.6 million, a 19.7% increase from about $757.3 million in the same period last year;
- Net income of $14.9 million, up 152.5% from nearly $5.9 million;
- Sales and marketing expenses of nearly $60.4 million, a 40.8% increase from $42.9 million;
- Technology expenses of $53.3 million compared with $46.8 million, a 13.9% increase;
- General and administrative expenses of $47.6 million, up 10.2% from $43.2 million.