03.02.2009
Quiz
Take the Top 500 Growth Quiz
The 10 questions below-all of which
relate to the growth of e-retailing-provide a small sample of the information
and insight you will gain about e-retailing in the U.S. from the Top 500 Guide.
See if you know the answers to these Top 500 questions:
1. What e-retailer
grew the fastest in 2007?
The fastest growing
retail web site in the U.S. sells coffee beans, but it's not Starbucks.com.
It's Green Mountain Coffee Roasters, which grew 250% on the web last year to
$60 million-all of it from selling single-cup brewers and single-serving coffee
and tea packages which are used in them. Starbucks does sell coffee and brewers
online, but it's not ranked among the Top 500 e-retailers. Its web sales
constitute such a de minimis part of the company's total sales that its online
revenue is not even mentioned in the company's annual report, which breaks out
sales by company-owned stores, franchised outlets and institutional food
service. Indeed, Starbucks.com is not mentioned in the company's otherwise
detailed 10-K financial analysis.
2. What e-retailer
added the most incremental online revenues in 2007?
One retail web site
did $4.1 billion in incremental sales in 2007, bringing its total online
revenue to $14.8 billion and putting it at the top of the e-retail industry for
the 13th consecutive year. If you don't know the answer by now, when it comes
to e-retailing you are in the jungle and can't see the river through the trees
and the name Jeff Bezos rings no bell.
3. How did
e-retailing's growth compare to the sales growth of stores in the U.S. last
year?
According to the U.S.
Commerce Department, total retail sales (excluding petroleum, autos and
restaurants) grew 3.7% last year. Retail stores grew 3.1% (one-quarter of a
percent after inflation). By comparison, e-retailing grew 22% and remained by
far the fastest growing component of the nation's retail economy.
4. What retail
channel-store chains, catalog/call center merchants, web-only retailers or
consumer brand manufacturers-grew the fastest on the web in 2007?
If you guessed
web-only merchants, you would have been right for just about every year-except
for last year, when catalogs/call centers grew their retail web sales by a
healthy 30%. They now account for just over 15% of all retail web sales.
Web-only merchants and consumer brand manufacturers each grew their web
businesses at the overall industry average of 22%, while retail chains grew at
only 18% on the web, despite their powerful brand names, merchandise networks
and distribution capabilities.
5. What merchandise
segment showed the greatest growth last year? What was the slowest growing
product segment online in 2007?
Jewelry became the
fastest growing merchandise segment online last year with a 36% increase. That
was a huge surprise to those retailers who relied on the conventional wisdom
that the web was the province of standardized and lower-ticket items. On the
other hand, health and beauty aids, which are standardized and lower-ticket
products, experienced the slowest web growth (11%) among the major merchandise
categories last year. So much for conventional wisdom.
6. In what
merchandise segment did the web account for the highest percentage of online
sales compared to total retail sales in that category? And in what merchandise
segment did the Internet account for the smallest percentage of that segment's
retail sales?
Fully 37% of all
office supplies were sold on the web last year, and the category's top three
store retailers were also the top three online leaders-Staples (the second
largest e-retailers), Office Depot (the third largest online business) and
Office Max (the sixth largest web merchant). Conversely, only 0.5% of food and
drug merchandise is sold online as these two categories remain the last bastion
of store-based purity.
7. What major retail
chain (above $1 billion in total revenue) grew fastest last year online?
For years, Netflix
dominated the online DVD rental business, stealing share from Blockbuster's
massive chain of outlets. As pressure from Netflix began closing some
Blockbuster stores, the movie rental chain finally started fighting back with a
new web-centric strategy. That strategy paid off handsomely last year as
Blockbuster grew its online business by 112% to $526 million, making it the
35th largest online retailer. Netflix grew at 21% and remained the top online
video site with $1.2 billion in sales, making it the 17th largest e-retailer.
8. What online
retailer had the sharpest decline in web-based sales in 2007?
While Apple was
raking in sales with the company's hot new iPhone, Palm.com posted a 45% drop
in online sales in 2007, the biggest percentage retail sales decline on the web
last year.
9. What was the only
online merchant among the 50 fastest growing e-retailers in 2006 whose web
sales declined in 2007?
ToolKing.com was the
28th fastest growing e-retailer in 2006, growing 80% to $27 million. Last year,
its online sales fell to $22 million.
10. What kind of
growth did Kroger Co. achieve online in 2007-single digit, double digits or
triple digits?
The Cincinnati-based
supermarket giant gets all of its $70 billion in sales from its
bricks-and-mortar stores because it does not have an e-commerce site. So it's
online sales growth percentage was measured by a single digit-zero.
If the online retail market is
important to you and you got less than five right answers, consider making a
modest investment ($65 plus shipping) to access all of the e-retailing market
research that is crammed into the completely updated 448-page Top 500 Guide,
2008 Edition. The information you receive will pay back that investment in
increased online sales a hundred times over.
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GS&MD - Gouvêa de Souza