Some words are just better than others when it comes to evoking strong feelings and emotions.
Take the word ‘home,’ for example. The minute I say that word, a flurry of familiar warm and fuzzy phrases come to mind, such as “Home is where the heart is”; “There is no place like Home”; “Home is the nicest word there is”; “Home wasn’t built in a day”; and of course, “Home, Sweet Home.”
So, is it any surprise that the giant tech firm/e-tailer Overstock has refocused on home, as home is also where the hard currency is?
Until very recently, the Utah-based behemoth launched in 1997 lived two lives—it truly was a tech company as well as a retail force.
As a tech company, Overstock.com consistently was recognized for leading the back as developers of customer-friendly mobile and retail apps.
And as early as 2014, Overstock had the distinction of being the first e-tailer to accept bitcoin as payment and in October of 2020, it announced tZERO, a subsidiary of Medici Ventures, the blockchain-focused, a wholly-owned subsidiary of Overstock.com, Inc.
Meanwhile, wearing its retail hat, Overstock had proven its prescience by pioneering the concept of drop shipping and out-Amazoned Amazon Prime by a year with the launch of its “Club O” loyalty program that gave customers almost free shipping.
Fast-forward to today and Overstock has made it clear that home is where its future and fortunes lie.
While the company had made its mark by selling everything from jewelry and watches to houses for watchdogs, that’s all changed, and with good reason. At the end of last year, some 94% of the online retailer’s sales came from home goods.
With that in mind, Overstock is shooting to have virtually all of its sales coming from home goods by September of this year and is constantly upgrading and enhancing its website to make it easier for shoppers to navigate.
The company’s massive network of suppliers—some 4,000—has also helped Overstock minimize the supply chain bottlenecks that have plagued the industry since the onset of Covid. Overstock’s model of only selling what is available has made it a go-to site for shoppers frustrated by long waits and out-of-stock notifications.
While Overstock has certainly not been immune from supply-chain issues, the depth of its vendor base usually means it can quickly replace an out-of-stock item with something so similar that the customer is satisfied.
Even so, the pandemic has disrupted businesses globally, and Overstock has taken a hit like every other business.
In its most recent earnings call, the company cited a 19% dip in revenue for the quarter compared to a year ago thanks to the conflict in Ukraine, record inflation, and all-time high gas prices.
During the call, Overstock’s CEO Jonathan Johnson also said that revenue would likely be challenged into the second quarter as the company sheds categories including jewelry from the mix.
However, while revenues are down, the company said that net revenue per customer spiked by 25%, and average order value—$221—jumped by 21% year over year.
One statistic reported during the earnings call regarding the consumer’s use of mobile devices call should be a wake-up call to any furniture retailer not fully adopting a technology and multi-channel platform.
During the earnings call, Johnson said that, during the quarter, mobile app downloads increased 54% sequentially versus the fourth quarter of 2021 and that the 54% growth was on top of the 80% fourth-quarter increase we highlighted during the company’s previous earnings call.
“Customers love our app-exclusive coupons, which help drive traffic to our highest order value, conversion, and retention platform, the mobile app. This execution helped us deliver on the largest president’s Day in the company’s history, Johnson reported.
Overstock has clearly come home to home goods. And based on everything I see, that decision is helping the folks at Overstock sleep like babies.
And speaking of sleeping well, the refocus on a home is helping Overstock’s customers also sleep soundly.
According to Johnson, 97% of the company’s sales were in home categories at the end of the quarter with, you guessed it, mattresses representing one of Overstock’s fastest-growing categories.
The company intrigues me, and if you compete against them, they should be on your radar, too.
I am putting the finishing touches on an exclusive interview with the executives at the company, so stay tuned for an even deeper dive!
