December 11, 2013, 3:32 PM

The secret to NoMoreRack’s holiday sales records

A quarter of its sales stem from shoppers clicking from social networks.

Zak Stambor

Managing Editor

Lead Photo

NoMoreRack.com Inc. had a very good start to the holiday season. The discount products retailer’s online sales topped $78 million between Nov. 1 and Dec. 2, which is 168% more than the $29.1 million it generated in the same period a year earlier.

That $29.1 million sales period had been the retailer’s highest grossing 31-day sales period. But the retailer topped that total between Thanksgiving and Cyber Monday, when it generated $32.3 million, more than double the $14.06 million during the same period a year earlier.

The retailer’s strong first 31 days of the holiday season generated revenue that is more than three-quarters of the $100 million in total sales NoMoreRack booked in all of 2012, according to the 2013 Top 500 Guide (NoMoreRack ranks No. 202 in the Top 500 Guide). The sales growth is keeping NoMoreRack well on track to reach its goal of tripling web sales this year, says CEO Deepak Agarwal.

A big part of the retailer’s growth is from shoppers clicking from social networks, says Agarwal. For example, roughly 25% of its sales between Nov. 1 and Dec. 2 stemmed directly from shoppers clicking from Facebook and other social networks to the retailer’s web site. That means that the retailer generated about $19.5 million in social-related commerce during that 31-day window alone. That revenue would have been enough to rank as the 21st highest social commerce sales total among retailers for all of 2012 in Internet Retailer’s 2013 Social Media 300, according to data available on Top500Guide.com. The 31-day sales total is more than retailers such as Kohls.com (which generated an Internet Retailer-estimated $18.1 million in 2012 social commerce sales) and Gap.com (which generated an Internet Retailer-estimated $11.3 million in 2012 social commerce sales) generated all of last year.

NoMoreRack’s social commerce sales surge is largely a reflection of the retailer increasingly viewing social media—and Facebook in particular—as a direct response channel rather than a forum to boost brand awareness, says Agarwal.

The majority of its posts focus on a specific product, as do most of the posts it pays to publicize via Facebook’s Promoted Posts ad product that lets a marketer pay to ensure that a specified number of targeted consumers see a post. That shift in its approach has led to 35% of the retailer’s traffic in a typical month stemming from social networks, the third-highest percentage in the forthcoming 2014 Social Media 500, up from 15% in 2012.

Those clicks are increasingly important because shoppers clicking from social networks to retailers’ sites are increasingly lucrative. A recent Adobe Systems Inc. study found that the average revenue per visit for shoppers who click from Facebook was 93 cents in the third quarter, up about 39% from 67 cents in the same period a year earlier. The average revenue per visit for consumers clicking from Twitter was 44 cents, up 300% from 11 cents in 2012. And the average revenue per visit for shoppers clicking from Pinterest was 55 cents, up 150% from 22 cents a year earlier.

There’s a simple reason that shoppers who click to retail sites from social networks are becoming increasingly valuable, says Agarwal. “Social traffic is very purchase-driven,” he says.

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