Hot 100 Retailers: Ecommerce

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It’s a rare retailer that doesn’t open a store or two. Not so for two of the hottest retailers in the country, who increased market share over the past year while operating exclusively in the digital realm. The only question for them is on which device their customers will shop.

Research firm Forrester estimates that by 2022, Americans will be buying $209 billion in goods from smartphones. Mobile commerce is the fastest growing part of ecommerce, although that growth is anything but steady, according to Forrester: 51 percent of the people Forrester surveyed don’t make purchases via mobile devices, saying it is easier to use a computer. Some 30 percent say a mobile screen is too small to shop from, and 22 percent say they don’t want to spend data allowances on shopping.

The only two pure-play online retailers which increased market share were home furnishings, décor and housewares retailer Wayfair and Build.com, which specializes in home improvement supplies in general and plumbing products in particular.

The biggest challenge for Wayfair these days is learning how to turn a profit. Increasing sales is no problem: More product, more discounts, cheap delivery. The company is still enlarging its housewares offerings and is in the second year of a major push into bathroom vanities, where sales have doubled over the past year.

“We’re taking a large number of steps across our business to bring customers the best possible offering in our category online and we’re being rewarded with the outsized growth in market share that we’re seeing in our business,” says CEO Niraj Shah.

“Wayfair is spending crazily on search and television to acquire customers,” says Maureen Mullen, chief strategy officer at Gartner L2. “As a pure play, it is in the game of growth and not in the game of making money, like established retail players. This makes them very hard to compete against.”

Source: Kantar Consulting

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