A number of retail chains reported strong e-commerce growth this week, helping them post revenue increases as store sales slump.
Retailers attribute online sales growth to a range of sources. DSW Inc., No. 153 in the Internet Retailer 2018 Top 1000, cited investments in marketing as a reason for its e-commerce growth, while Ulta Beauty (No. 91) said online-only products provided significant growth.
- DSW didn’t break out exact e-commerce revenues, but chief financial officer Jared Poff said on the company earnings call that orders placed online and via a mobile device increased by more than a third year over year for its first fiscal quarter ended May 5. “Recent investments in digital marketing drove strong momentum in online demand, which increased by a remarkable 36%,” he said, according to a transcript from Seeking Alpha. Total comparable sales were up 2.2% overall.
- Express Inc. (No. 97) reported a 35% increase in e-commerce sales for the first quarter. Online sales accounted for 28% of total revenue, or about $134.2 million, during the quarter, up from 21% of total revenue, or about $99.6, million during the same period last year. E-commerce was a strong spot for the apparel brand, which reported a total comparable sales increase of just 1%.
E-commerce sales at Ulta Beauty were up 48% year over year to $154.4 million during the first quarter. Online sales now represent 10% of the retailer’s total $1.54 billion in overall sales. During the earnings call, CEO Mary Dillon said Ulta has seen significant growth from brands it only offers online or in a limited number of stores. The retailer plans to deploy buy online, pick up in store operations later this year. Comparable retail store sales increased 4.7% during the same period last year and overall comparable sales (including stores open at least 14 months and e-commerce sales) were up 8.1%. Ulta ranked No. 20 in Internet Retailer’s new report the Omnichannel Winners in U.S E-commerce.
- Lululemon Athletica Inc. (No. 90) posted a 60% year-over-year increase in first quarter comparable sales through its direct-to-consumer channel, which is mostly online sales, while comparable store sales rose 8%. Total comparable sales were up 20% with a net revenue of $649.7 million.
- Abercrombie & Fitch Co. (No. 69) announced a 14% increase year over year in direct-to-consumer sales, which include e-commerce transactions, during the first quarter. The direct channel generated $200.7 million in sales, or about 27% of the apparel retailer’s total sales of $730.9 million.
- Dick’s Sporting Goods (No. 54) online sales increased 24% year over year during the first quarter to $210.1 million. That’s now 11% of total sales, compared with 9% during the same period last year. Comparable same-store sales dipped 0.9%, but overall the retailer reported a 4.6% total revenue increase to $1.91 billion.
- Costco Wholesale Corp. (No. 12) boosted e-commerce sales by 36.8% year over year for its 2018 fiscal third quarter ending May 13. Profits are down with a gross margin of 11.1% compared with 11.5% during the same period last year. However, the warehouse chain pointed to some one-time costs—such as purchasing box-making equipment—as eating into its margins during the quarter. Total comparable sales were up 12.1% to $32.4 billion.
- Hibbet Sports Inc. has been building its e-commerce operations and reported that online sales now make up 7% of overall sales or $19.2 million. However, the move to online sales has proven challenging, with the retailer citing increased freight costs associated with e-commerce sales as a reason for higher operating costs for the quarter. Overall expenses hit 22.5% of net sales, compared with 21.2% last year. Comparable store sales were down 0.3%, with net sales across stores and e-commerce totaling $274.7 million.