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‘Tis the season to… buy furniture online? December 17, 2007

Posted by jeremyliew in Ecommerce.
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Bear Stearns and Comscore recently put out a report on ecommerce for the holiday season. While overall ecommerce sales were up around 20% year-on-year, this average hides significant variability between categories.

This slide shows annual growth rates ranging from 10% (music, movies and videos) to 138% (video games, consoles and accessories).

I found the second fastest growth category to be most interesting. Online sales of Furniture, Appliances and Equipment are almost 70% higher than last year.

This really underscores the changing nature of online retail. Conventional wisdom a few years ago was that only easily shipped items would be sold online. Indeed, books (Amazon), jewelry (Blue Nile – a Lightspeed portfolio company), shoes (Zappos) and other relatively small and light items led the early surge of ecommerce.

But more recently we’ve seen a much broader set of products sold online. According to Internet Retailer, the two fastest growing Ecommerce sites of 2006 were Lumber Liquidators and Diapers.com. When pets.com and Webvan failed, conventional wisdom was that ecommerce could only work for goods with a high value-to-weight ratio. Neither hardwood floors, nor diapers, fall into that category. And in the Webvan category of groceries, Freshdirect does hundred of millions of dollars in sales in the NY/NJ area alone as a pureplay groceries etailer, to say nothing of Safeway and Peapod (owned by the same parent company as Stop and Shop and Giant).

As consumers become more willing to make large purchases online, and as “last mile” delivery logistics improve to residential addresses, we’re seeing a real surge in the online sale of items like claw footed bathtubs, rowing machines, trampolines and jogging strollers that we might never have imagined in the 90s. This was the thesis behind our investment in Mercantila earlier this year (which operates all the stores linked to in the previous sentence) and is also the driver behind the growth of its competitors including Netshops and CSN Stores.

There is still time to buy your big holiday gifts online – shop now! ;-)

Comments»

1. samantha - December 17, 2007

Do you know where I could get a copy of this presentation?

2. John Philip Green - December 17, 2007

I’ve been a fan of the Merchantila business models since I met the founder’s over a year ago at a “Founder’s Brunch” event. I love that they are the opposite of Amazon or Shop.com… their individual stores inspire a boutique shopping experience.

I would like to see Shopify.com move more in that direction, they have the perfect technology for it.

3. Alex - December 17, 2007

Yes, I’d also like to see a copy of this presentation. Where can I find it. Thanks.

4. Chuck Tanner - December 31, 2007

Furniture online might be crazy enough to work!

5. Jeen - February 19, 2009

The trend to buy expensive articles online is not surprising since this is where you save the most.

6. furniture - September 14, 2009

Online sales in general are always rising so it makes since that furniture and other larger ticket items would now be on the rise as well.

7. Modern Platform Beds - August 31, 2012

It’s crazy how much furniture has grown online. It is a proven model to create the boutique experience and it gives access to these items to individuals who live in places that do not have shops which carry these items.


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