Lowe’s Cos. Inc. grew online sales 11% during its fourth quarter ending Feb. 2. Plus, 60% of online orders were picked up in stores, according to CEO Marvin Ellison speaking on a call with investors Wednesday. Earlier this week, The Home Depot Inc. reported that 50% of online orders were picked up in stores.
Lowe’s, No. 21 in the Internet Retailer 2018 Top 1000 compared to Home Depot at No.7, also reported strong traffic over the holidays, up 13.0% over the same period last year according to SimilarWeb, but site performance hampered growth.
“While traffic to our website was strong, we were unable to fully capitalize on the traffic due to system challenges, such as the outages we experienced in Black Friday weekend,” Ellison said.
To ensure smoother growth, the company hired Mike Amend as president of online business in January. He previously led omnichannel efforts at J.C. Penney Co. Inc. (No. 31).
Part of that smoother growth will include an increased online assortment in 2019, shifting slower-moving products out of stores and onto the website to improve the return on store inventory. It will also include training store employees on using that online selection to satisfy in-store shoppers.
In other earnings news:
- Electronics and appliance retailer Best Buy Co. Inc. (No. 8) grew online sales 10.5% during its fiscal year ending Feb. 3. During its fourth quarter, ecommerce sales increased 9.3% over the same period last year, boosted by strong holiday sales. However, both increases are smaller than the growth posted last year, when ecommerce grew 21.8% for the year and 17.9% for the quarter. Exact ecommerce figures for the year weren’t disclosed, but ecommerce accounted for 21.9% of sales in the fourth quarter, or $2.96 billion, compared with 20.0% during the same period last year.
- L Brands Inc. (No. 26) reported a 19.5% increase in direct sales, which includes ecommerce revenue. The owner of Victoria’s Secret and Bath & Body Works generated $2.47 billion in direct sales in 2018, compared with $2.07 billion the previous year. Direct sales at Victoria Secret were up 15.8% to $1.75 billion, while Bath and Body Works grew direct sales 29.6% to $723.8 million. Victoria’s Secret is testing a new online site that the company says will help it compete with competitors, but didn’t give exact details. The site is expected to roll out in April.
- Office Depot Inc. (No. 14) increased buy online pick up in store orders 24% for the year. It did not break out ecommerce figures.
- Chinese ecommerce giant JD.com Inc. (No. 1 in the Internet Retailer Asia 500) posted fourth-quarter revenue ahead of estimates, as Singles’ Day promotions helped the Google-backed online retailer fend off competition despite a decelerating Chinese economy. Total revenue for the year was RMB 45.9 billion ($67.2 billion), up 27.5% from 2017. In the fourth quarter, JD recorded a 29.5% increase in gross merchandise value, which refers to the total value of goods sold on its platform, its slowest ever. It will stop giving this figure on a quarterly basis and instead release it once a year in the future.