Full online retail scorecard is in for 2012 – and the big players are struggling
Tuesday, September 25, 2012/
SmartCompany has been keeping an eye on the retailers’ results this year with a special focus – seeing just how much money these companies make online.
The answer is a little harder to discover than you might have thought. Most companies don’t reveal how much they’re making online, although almost all say they’re investing in “omnichannel” opportunities.
The biggest winner out of all the companies we’ve profiled so far? Domino’s, which, while not strictly a traditional retailer, has managed to deliver a massive result with 50% of all sales now online. That total comes to hundreds of millions of dollars.
Everyone else is far behind, with the next most successful retailer open about their sales being JB Hi-Fi, with $50.8 million in online revenue, or 1.62% of sales.
So now a few more companies have released their results, it’s time we looked back into the retail space and find out just how much money these companies are making through digital channels.
Gerry Harvey loves to talk about how online sales are only a small portion of the company’s revenue. But as for the investors themselves, they’re none the wiser. The company’s financial report doesn’t actually delve into any detail.
What it does say, is that online sales are “low” but “performing to our initial expectations”.
Harvey says the company is making less than 1% online, or about $50,000 to $60,000 a day.
At the low range of that estimate, Harvey Norman would be gaining $18.2 million from online sales, which equates to about 1.2%.
It’s certainly not a lot, but it’s in line with the rest of the market.
Like several other retailers, Kathmandu hasn’t released any information about its online sales. Its total sales have grown 13.4% over the year to June, although profit after tax took a dive of 10.7%.
The only thing the company has said so far is that online sales “are growing rapidly from a relatively small base”.
Chief executive Peter Halkett has also said the company is continuing to invest in its online platforms. In fact, he said it was the key investment of 2012.
“Kathmandu’s investment in systems to grow our online sales, both within Australasia and globally, will continue, given the opportunity presented by this channel.”
Once again, Myer has paid lip service to online sales but hasn’t actually given any indication of what the company is making on the internet.
Chief executive Bernie Brookes continues to say sales are less than 1% of all sales, which would place them at anywhere up to $30 million.
But there is some cause for hope, here. The company is adding more stock keeping units to its online store every day, and has invested in high quality photography and video. And according to its results, online sales doubled in the past year.
“Our online sales more than doubled and the rate of growth has accelerated during the year. We believe this represents a significant opportunity for the business.”
David Jones has offered no hint in its financial report as to what amount of money it’s making from online sales, although like Myer it continues to push its online sales strategy further. The company says it hopes to have 90,000 stock keeping units in the store by Christmas, and has also invested in high quality photography and video for its site as well.
Once again, there is no figure here as a total of sales. But Premier, which owns The Just Group, Peter Alexander and Smiggle, says it received a “strong contribution” from its online sales, which rose by 67% across the year.
It also mentioned that the upgraded Dotti website has “delivered exceptional results”.
Here are the retailers we profiled last month:
Domino’s is one of the few companies actually revealing anything about online sales. The company said its digital turnover reached 50% of all sales this year – out of a total of $544 million.
The business also said it wants to increase its online sales to 80% of total turnover by 2016.
JB Hi-Fi is also one of the few releasing hard statistics. Online sales are up 77.3% to $50.8 million – that’s 1.62% of revenue overall.
It’s hard to provide online sales when your business isn’t online at all. And not only that, but chief executive Chris Bryce told the media it doesn’t have any plans to go online any time soon.
The retail giant says its online sales have jumped 95% across the entire network, although that drops to just 48% when the Cellarmasters business is excluded.
Big W sales were up 76%.
Although Country Road said it “continued to invest and develop our online and digital strategy”, it didn’t actually reveal a breakdown of online revenue, or even percentage growth.
It did, however, say sales “exceeded our expectations”.
Wesfarmers offers no breakdown of online sales, either for its Coles division, or for retail segments including Officeworks or Target.
While reports indicate Officeworks is turning over about $150 million a year, which would equate to about 10% of all sales. But as for now, no investor is the wiser.
Super Retail Group
The Super Retail Group certainly has a lot of reach, with the Supercheap Auto, Goldcross Cycles, Ray’s Outdoors, Rebel Sport and Amart chains.
Except none of these companies is given an online sales breakdown in its annual results.
Speciality Fashion may have reported a loss this year, but its online sales are continuing to improve. Digital sales reached a total of $15 million, representing 2.6% of total value.
The fashion retailer gave no breakdown for its online sales, saying only that it would continue to encourage sales growth online and that it would use its online presence as a “primary customer contact point for information”.