Niche musical instrument and equipment retailers led the way with category e-commerce sales growth, while two of the bottom three were book sellers that had negative growth in 2017, according to Internet Retailer estimates.

Online retailers in the books/music/video category didn’t quite match the overall U.S. e-commerce growth rate of 15.6% in 2017. Instead, they fell short of the overall Internet Retailer Top 1000 growth rate of 18.5%. Though, at a respectable 13%, the category got a boost from the top-growing companies within the category, all of which serve niche markets.

Among the 39 retailers in the books/music/video category in the Internet Retailer 2018 Top 1000, Kraft Music had the highest growth rate at 103.8%. Internet Retailer-estimated their 2017 online sales between $40 million and $70 million. Kraft Music made a name for itself online as it transitioned away from its 1970s storefront in the Milwaukee area.

Retailers in the books/music/video category, particularly the former, have tried to dodge Inc.’s shadow for years. But the five category growth leaders hold their own by virtue of their expertise.

Niche retailers sales rise

Of the top five category growth leaders, all serve fairly narrow markets and four sell musical instruments and equipment. In addition to Kraft Music, No. 617 in the Top 1000, Stewart-MacDonald (No. 789) sells guitar-making tools, parts and electronics; Allparts Music Corp. (No. 860) offers guitar, bass and amplifier parts; and Music Go Round (No. 712 and operated by Winmark) sells used instruments and other music gear.


Sounds True (No. 984) had the second-highest growth rate in the category and is a multimedia publishing retailer that sells online courses, books and videos on meditation and other spiritual and well-being topics.


Video streaming services such as Netflix and Amazon Prime have joined forces with cable TV. They now offer current or recent hit movies to put a lasting chill on the market for DVDs. But CD Universe (No. 511) grew 36.8% in 2017, by Internet Retailer estimates. They have survived since its 1996 launch by shifting emphasis from music CDs into DVD and Blu-ray disks, along with other products such as T-shirts and lingerie.

Major retailers stuck fighting Amazon

Apple Inc. is ranked No. 2 in the Internet Retailer Top 1000, and its 2017 online sales growth rate was in the middle of the category pack at 11%. It’s the highest-ranking company in the books/music/video category. The story is less sunny for the next-highest ranked retailer in the category, Barnes & Noble Booksellers Inc., No. 74. The long-time retail chain brought up the rear in terms of 2017 online sales growth in the category at -4.4%.

For years, Barnes & Noble has fought an uphill battle as shoppers flocked to online outlets—especially Amazon, which got its start specializing as an online book seller. The books and gifts seller posted a 5.4% drop in same-store sales in its fiscal year ended April 28. In a statement in June, the company said its annual results also swung to a loss of $125.5 million, from a profit of $22 million a year earlier.

Bookbyte, No. 205, sells and rents college textbooks and had the highest growth rate among book sellers in the category with 19.9% sales growth.

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