NEW YORK –Amazon.com is the top online retailer in TWICE’s inaugural Top 20 CE E-tailers Report, which, truth be told, is not a great surprise.
But when you compare and contrast this list to TWICE’s Top 100, and the many news stories you have heard in the past year about how individual retailers are winning or losing the online sales war in CE, you get a better picture of what’s going on.
The study, developed by TWICE in cooperation with the Stevenson Company, our longtime research partner, employed the same methodology used for the TWICE Top 100 CE and Major Appliance Retailers lists and related dealerranking reports, and includes sales that originated from both computers and mobile devices.
First off, Amazon’s $15.6 billion in CE calendar year 2013 sales, a 20.8 percent gain over the previous year, gave it a No. 3 ranking in our Top 100 – not a shock, given all the angst heard by many other CE retailers about the online retailer’s growing power in the market.
On this list, Amazon is No. 1 with a long lead over No. 2 Apple, with $4.4 billion in sales, representing a sales drop of 13.5 percent from the previous year.
Having Amazon and Apple at numbers 1 and 2 on this list is also not a surprise since their combined online sales during last year is more than half of the Top 20’s $38.2 billion in total sales volume.
That’s because in the past decade, a strong argument could be made that the CE industry has been split into two camps: the traditional industry and the Amazon/Apple industry. Amazon evolved into a retailer/ manufacturer in this industry while Apple has morphed into a gargantuan manufacturer/retailer.
This list also shows the strong efforts traditional brick-and-mortar retailers have begun to make in online CE sales to ward off the dual assault of Amazon and Apple.
With all the complaints about Walmart’s and Sam’s Club’s across-the-board sales performance in the past year, both have generated strong double-digit growth in online CE sales as the company pours resources into digital development. Walmart’s CE sales grew 11.5 percent in calendar year 2013 to $3.59 billion, giving it the No. 3 ranking on our list. And Sam’s Club had 40.2 percent growth in online CE sales last year, placing it at No. 15 with $291 million in revenue.
Best Buy, the perennial top banana in the TWICE Top 100 CE Retailers rankings, came in as a strong No. 4 on this list with $3.5 billion and 18.1 percent growth over the prior year. This performance matches much of the praise Best Buy has received for bringing its e-commerce operations up to speed, but as even its management concedes, more needs to be done.
Staples ranks No. 16 on TWICE’s Top 100 CE Retailers Report for calendar year 2013 with $1.3 billion in sales, 4.2 percent down from what it did the year prior. Yet with its renewed emphasis on e-commerce and the electronics category, Staples increased its CE online sales by 23.1 percent last year to $273 million.
There are two real surprises in this list and the first is No. 12 Sears. The much-maligned retail giant generated $312 million in online CE sales last year, a 24.2 percent gain. Maybe it is the Shop Your Way loyalty program gaining traction or good merchandising, but the double-digit gain is an impressive one and supports chairman/CEO Edward Lampert’s multichannel pronouncements.
And Target, which endured a security breach during last year’s fourth quarter, seemed to hold its own when it came to online CE sales during last year. Target had $504 million in online CE sales last year, a gain of 16.4 percent, giving it a 10th-place berth on our debut list. In contrast, Target was No. 5 with 1.3 percent sales growth for a total of $5.9 billion in CE sales on TWICE’s Top 100 Report.
Still, with all the growth in online and mobile CE sales in the past year, all retailers in the industry, whether in the Top 20 or small independents that are members of a buying group, have to redouble their efforts to engage and sell consumers online.
For all retailers, the trend toward more online sales means everyone has to engage with consumers more via social media. For those with brick-and-mortar stores, it means they have to closely coordinate online and store operations so they can process orders online that they can quickly deliver to the store nearest the consumer – or even deliver to the customer from the store.
While total growth for the TWICE Top 20 CE E-tailers was a rather pedestrian 7.2 percent last year, it certainly outpaced the flat multichannel sales of the Top 100 CE retailers, and the popularity of online and mobile shopping will continue to build in 2014 and beyond.
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