Wayfair Inc.’s online sales skyrocket 91% in Q3
11.11.2015 311 views
A nearly 61% increase in Wayfair Inc.’s active customers from a year ago helped boost the online furniture and home decor company’s web sales about 91.0% in the third quarter.
For the third quarter ended Sept. 30, Wayfair reported $545.0 million in sales, up from $285.5 million in the same period a year earlier. The e-retailer’s 4.6 million active customers placed 2.3 million orders in Q3, compared with the 2.9 million customers that placed 1.3 million orders in third-quarter 2014.
The increase in sales and customers was driven by bigger investments in advertising and merchandising, CEO and co-founder Niraj Shah told analysts on an earnings call. “On one hand, we are investing in advertising to acquire high-quality new customers, and concurrently on the other we are investing in the site experience, merchandising and operations to grow repeat orders,” Shah said on the call, according to a transcript from SeekingAlpha. Repeat customers placed 55.2% of orders in Q3, compared with 49.8% in the same period in 2014.
Wayfair, No. 33 in the Internet Retailer 2015 Top 500 Guide, increased merchandising, marketing and sales spending 102.2% in Q3 to $27.1 million from $13.4 million a year ago. Advertising spend in Q3 was $70.7 million, up 42.0% from $49.8 million a year ago.
Total direct-to-consumer revenue, which is orders placed on Wayfair.com, Joss & Main, AllModern, Birch Lane and Dwell Studio, accounted for 91.8% of Wayfair’s $594.0 million net revenue in the third quarter. In the year-ago period, direct-to-consumer revenue accounted for 84.9% of revenue of $336.2 million. Total revenue includes revenue from Wayfair Inc.’s media business, such as the sale of ad space on Wayfair-owned sites, and sales through other retail sites that sell Wayfair products.
Wayfair ramped up hiring in the third quarter, adding 390 employees, the company said on the call.
Source: Internet Retailer