The tombstone should read:

DTC

Born: 2010, Died: 2022

Rest In Store

With the recent news that the beauty brand Glossier had become the latest direct-to-consumer brand to begin selling its products through a third-party retailer – Sephora – we can officially close the chapter on the digitally native era.

Sure, companies like Glossier, Casper, Warby Parker – and closer to home textiles, Boll & Branch and Parachute – continue to sell online with a direct-to-consumer model. But increasingly they are opening their own stores or placing their products for sale through other established retailers.

Casper has more than 65 of its own stores and says it products are available through nearly two dozen other retailers from Bed Bath & Beyond to Rooms To Go to Wayfair. Warby Parker, the eyeglass company, says more than half of its sales come from its own stores rather than from its e-commerce operations. Just about every other consumer product company that began life online has moved into physical retailing in one way or another.

Not since the explosive emergence of the catalog showroom model in the 1970s and 80s and their just-as-quick meltdown later in that century have we seen a retail format rise and fall in such a rapid manner. (OK, maybe the flash sale phenomenon lasted even shorter, but that really was a blip, don’t you think?)

And before the nasty rebuttals come from the DTC guys out there, I’m not saying you’re toast, I’m just saying you need physical outlets to make it work.

How did this all happen? When the DTC guys first came along and said stores are the enemy and they had a better way, it all sounded pretty inviting. And it was, what with free deliveries, ridiculously liberal return policies and in many cases prices that were extremely competitive with what legacy retailers were selling things for. Of course, it helped that most of these start-ups were adhering to the tech model as pioneered by Amazon – all about building the top line and not anything about the bottom line. While a handful of DTC start-ups said they were profitable, most danced around the question both before and during the pandemic.

Now that conspicuous consumption – especially for home products – has calmed down significantly and virtually-free money is gone with rising interest rates, the need to reel in expenses and actually show a profit has usurped the esoteric beauty of only selling online.

So, we find ourselves in a new era for all of these businesses. Call it DTC2.0 or Sometimes-Direct-to-Consumer or even Sell-it-However-We-Can, but this is now officially the end of DTC as we knew it. And you know what? The industry is the better for it for all of these companies getting into the business.

We’ve seen the establishment of new brands, something that is most difficult to create and sustain, especially in home textiles. Retailers have new places to buy from and new things to offer their shoppers. Existing vendors have had to adapt their products and policies to compete against the upstarts.

And, most importantly, the visibility of these products – again, especially in soft home – has been enhanced and enlightened in the eyes of the consumer. For an industry that does a poor job of communicating with the ultimate users of its products, this is a huge step up.

The best DTC companies will stick around and continue to prosper. We just have to call them something else now.

Menomonee Falls, Wis. – Nearly 50% of BOPIS customers buy more when they retrieve their online purchases, so Kohl’s is removing a key point of friction to encourage more in-store pickups.

The new Kohl’s Self-Pickup service eliminates the wait on line at a pick-up counter. Within two hours of placing their orders, shoppers who select “In-Store Pickup” will receive a “Ready for Pickup” email that will specify if the order will be found in the designated Self-Pickup area. Customers will then be directed to the area within the store for a quick, email-guided pickup process.

Following a test earlier this year, Kohl’s announced today that the services is now available on eligible Kohls.com orders at all of the retailer’s more than 1,100 stores nationwide.

“With some of the busiest months ahead for both customers and associates, we’re excited to offer self-pickup at every store for an easier and more efficient omnichannel experience,” said Siobhán Mc Feeney, Kohl’s chief technology officer.

More:

Kohl’s retools its plans now that acquisition deal with FG has tanked

High Point, N.C. – It was bound to happen sometime, and it seems that 2022 is the year. For the first time, home décor shoppers made more transactions using their mobile device than they did a desktop.

According to Syte’s The State of eCommerce Discovery in 2022, 52.9% of transactions in the first half of the year took place on via mobile. The study calls this change “a critical tipping point for home décor brands and retailers as it represents a shift in consumer behavior that will need to be mirrored in the overall approach to customer experience.”

Although mobile logged more transactions and more sessions by device, desktops still reigned supreme in most other categories, including time spent on a site (7:22 minutes vs. 5:35 minutes); conversion rate (2% vs. 1.1%) and items ordered (1.6 vs. 1.4)

Most important to note, desktops accounted for a higher average order. Syte’s research found a home décor order via desktop averaged $220.20, while the average order value through a mobile device was $166.10, a difference of more than 32%.

Looking at the various means by which consumers search for home décor products, email topped the charts as the source for longest time spent on e-commerce sites, coming in at just over 21 minutes. After “other,” in a distant second at 7:26 minutes, direct searches, Google paid and Google organic rounded out the top five.

Email was also the leader for generating traffic that produced the highest average order value at $334.50. Direct was second at $233.30, followed by Pinterest, $211.20; affiliate, $192.40; and other, $192.10.

About the data

The data for Syte’s The State of eCommerce Discovery in 2022 is based on more than 1.2 billion e-commerce sessions in the home décor, fashion and jewelry verticals as recorded in Syte’s database from January through June 2022. Syte is a product discovery platform that uses AI to create search and discovery experiences for shoppers.

See also:

• In-store vs. online: Home furnishings shoppers embrace both formats
• Consumers cooler on home merchandise but still spending

Charlotte, N.C. – DTC home and bath textiles company Delilah Home is giving back during Back-to-School.

The brand has pledges to donate 20% of all profits to Operation Warm during the season. Over the last 22 years, the national nonprofit and its partners have provided new coats and shoes charitable organizations that support children and families in need. Recipients include Head Start programs, Title 1 schools – where 40%+ of students’ families are at or below 150% of the federally prescribed poverty level – and other urgent need human service organizations such as homeless shelters, community libraries, foster care agencies and more.

“Sustainability, impact, and community are the three fundamental pillars that drive our efforts to tithe back to the community we serve. Having served with Mecklenburg South Rotary for the last two years, I have witnessed firsthand the power of Operation Warm with elementary children. We are looking forward to the impact our emerging brand can do for Operation Warm” said Michael Twer CEO and founder of Delilah Home.

Founded in 2019, Delilah Home other charitable partnerships include 1% for the Planet and Rotary International, and Operation Warm.

“We are proud to partner with Delilah Home in their commitment to make an impact on their community – especially this year, when more families than ever are in need,” said Grace Sica, Executive Director, Operation Warm “Like us, they understand the value of warmth; both physically and emotionally.”

See also:

Delilah Home introduces organic cotton beach towels

Delilah Home wins Good Housekeeping award for sheets

New York — Furnishings retailers in the e-commerce space that cultivate their customer base are being rewarded with the promise of repeat purchases.

The Bluecore 2022 Retail Ecommerce Benchmark Report found that online home goods retailers, a group that encompasses chain store furniture retailers and some home décor sellers as well, saw the percentage of shoppers who will likely buy again increase from around 12% with the initial purchase to more than 52% by the sixth purchase based on buying history.

Every subsequent purchase further enhances the chance for additional ones, according to the report, demonstrating the importance of fostering loyal shoppers to drive revenue.

The study — which looked at 35.5 billion campaigns in 2021 delivered to shoppers via global retail brands’ emails and e-commerce sites and the resulting actions taken by shoppers — also showed the majority of retailer shoppers were first-time buyers.

Within the home goods category, 68% were first-timers to a brand, the highest among all the verticals tracked, including apparel, consumer electronics, footwear, gifts and floral, health and beauty, jewelry and luxury, and sporting goods and outdoor.

The percentage of one-time buyers who made a repeat purchase in the home goods category was around 6% vs. the high of about 8.5% for health and beauty. Gifts and floral saw the lowest percentage of conversion (1.6%), indicating shoppers are less engaged with gift brands and more likely to seek alternatives when an occasion arises.

The report looked at different shopper lifecycles as well. Shoppers classified as at-risk — meaning those who have deviated from their typical buying cycle and may not purchase from a site again — are still converting and clicking at rates that are nearly comparable with active shoppers, Bluecore noted, signaling retail brands have an opportunity to hold onto these consumers with the right messaging and could bring them back into active status.

Consumers who create a wish list are the most likely to convert that desire into a purchase and boost their cart size. The study points out that once brands know what a shopper is seeking, they should devise strategies to show them related products to maximize the sale.

See also:

• 3 key areas targeted as consumers shift spending priorities | Survey
• Home furnishings/furniture sector among stronger performers in monthly retail sales snapshot

Minneapolis – Six months of inflationary pressures have consumers rethinking how they are budgeting their money – including for Holiday 2022.

A recent survey from Digital River, a global commerce enabler, three areas in particular are top of mind for reduced spending:

• 67% of U.S. adults surveyed have reduced their spending on “non-essential” items in the last six months (including vacations and holiday shopping)
• 40% are spending less on summer vacations, including 49% who are reducing travel expenses
• Over a third (38%) expect to spend less at Christmas this year, while another third (32%) are planning to spend the same as usual

The Digital River Survey on Cost of Living and Online Spending Habits also explored how consumers view their personal finances.

• Almost half of US adults (45%) also say their financial situation has got worse in the past 12 months.
• Less than a quarter (24%) think their financial situation has gotten better.
• Three in ten (30%) say it has stayed the same.

U.S. adults are slightly more optimistic for the future however, with almost two in five (38%) expecting their financial situation to get better in the next 12 months and just over a quarter (27%) who think it will get worse.

Even so, online shopping purchases remain high. The survey found that 42% of US adults make an online transaction at least once a week.

• 39% have shopped online more frequently in the past six months
• 54% expect to increase their online shopping tendencies due to convenience
• Despite growth in e-commerce, 45% note not being able to see products in-person as a major barrier of online shopping, followed up delivery price (35%)

Although consumers are tightening their belts, “our research has shown the pace of online spending isn’t expected to slow down despite the squeeze on finances,” said Ted Rogers, chief revenue officer at Digital River.

See also:

Basic bedding suppliers seeing shift in consumer currents

Having inflation fears? CPI numbers reveal spike in household furnishings prices

Seattle – Amazon’s bottom line took a shellacking in the second quarter, but the e-comm giant said revenues are revving up.

While Amazon CEO Andy Jassy acknowledged the very difficult macroeconomic state, he pointed out that the recent record sales results from Prime Day will be reflected favorably in the third quarter earnings.

Amazon is the 3^rd largest seller of home textiles in the U.S., with 2021 soft home sales of more than $2.8 billion, according to HTT’s Top 50 Retail Giants report.

Related news:

Which home categories were the biggest winners on Prime Day? Here’s the data

Leaked docs show Amazon planning a second Prime Day event to boost growth

The company expects Q3 net sales to come in between $125 billion and $130 billion, or to grow between 13% and 17% compared with third quarter 2021. The company’s operating income is expected to be between $0 and $3.5 billion, compared with $4.9 billion in the third quarter of 2021.

“Despite continued inflationary pressures in fuel, energy and transportation costs, we’re making progress on the more controllable costs we referenced last quarter, particularly improving the productivity of our fulfillment network,” said Jassy. “We’re also seeing revenue accelerate as we continue to make Prime even better for members.”

On the quarterly earnings call with investors, CFO Brian Olsavsky said ongoing issues include inflationary pressures, which remained elevated, along with higher fuel, trucking, air and ocean rates.

“One new thing is the additional pressure on energy electricity rates because of the ramp up in natural gas prices,” he added.

“Regarding the Prime fee increase earlier in the year, we are happy with the results we are seeing in the Prime program,” Olsavsky added on the call. “Prime member membership and retention is still strong. That change has been above our expectations positively. I think the benefits of the program continue to get better and better, in-stock has never been higher, (and) delivery speed is increasing.”

Amazon lost $2 billion in the quarter ended June 30, compared with a net income of $7.8 billion in last year’s Q2.

Net sales increased 7% to $121.2 billion, compared with $113.1 billion in second quarter 2021. Earnings per share came in at a loss of 20 cents per diluted share this quarter compared with a gain of 76 cents per diluted share in the first quarter of last year.

Amazon’s investment in electric automaker Rivian Automotive, whose shares have declined about 68% to date, also contributed to the income loss.

Amazon added 14,000 workers in the first quarter, due to the omicron variant, Olsavsky said to investors on the call.  “We were left with a higher head count position, and it has come down to adjusting hiring levels and with normal attrition, the issue was resolved by the end of April,” he said.

“That is dominating the quarter-over-quarter reduction in head count. I would note that we are still up 188,000 year-over-year and nearly double of what we had heading into the pandemic in the early part of 2020. Right now, we see a stabilization in the workforce and good hiring rates.”

Salt Lake City – Revenue for e-commerce retailer Overstock decreased 34% year-over-year, coming in at $528.1 million for the second quarter ending June 30 compared with $794.5 million in last year’s second quarter.

“While the retail environment was challenging throughout the second quarter and sales results were below my expectations, we continued to deliver smart value to our customers, make progress on our strategic initiatives and provide our partners with an efficient and effective channel to increase their unit sales,” said Jonathan Johnson Overstock CEO. “Our continued profitability and strong balance sheet support that our business model is a winning one, able to withstand jolts in the market.”

Among the metrics for Q2:

The company posted a gross profit of $121 million or 22.9% of total net revenue compared with $174 million in last year’s second quarter. Diluted EPS for continuing operations came in at 12 cents for this year’s second quarter vs. $1.73 in in Q2 2021. Diluted EPS for total operations was 12 cents this quarter vs. $6.47 for the year-ago period.

On the earnings call with investors, Johnson said the company posted the second largest Memorial Day sales in company history, and he believes special selling days in the second half of the year will be just as successful.

“Memorial Day was very good, better than President’s Day,” Johnson said on the call. “June was worse than May, but July is a little better than June. It’s tough to know how the summer will play out or what will happen in the fall when people get back to shopping.

“The holidays are important days for us, and we are getting better at it. With Labor Day, our customer day, Black Friday and Cyber Monday coming up, we will capitalize on all of these.”

Johnson said that due to the volatility of the past two years, when this year’s second quarter performance is compared to Q2 2019, the company shows gains in both market share and profitability. “In fact, Overstock has grown 44% compared with 2019,” he said on the investor call.

The company is increasing the breadth and depth of its assortment, according to Johnson, and has now completely exited all non-home categories as of the end of June.

“Now that we are 100% home, expect to see different branding campaigns rolling out that show that we are home,” Johnson said on the investor call. “They will be exciting and catchy, and consumers will understand them. The Overstock name recognition is very high, but the association with home needs to grow. This will change over the coming quarters with more focused branding.”

Overstock is looking to special selling events in the back half of the year to drive sales.

For the rest of 2022, the company is focused on growing its business in Canada to 10% of its U.S. revenue and is enhancing the customer experience in Canada with more locally sourced product.

“Our disciplined execution and differentiated asset-light operating model allowed us to remain profitable for the ninth consecutive quarter,” Johnson said. “(That’s) even with weak consumer sentiment, ongoing macroeconomic and geopolitical volatility, higher inflation, and significant competitive pressures.”

See also: 

• These factors have Overstock CEO thinking about growth | Exclusive
• Overstock taps new CMO

Seattle – Amazon said home was hit on Prime Day 2022. Now new third-party data reveals which product categories nabbed the biggest share of the business.

Overall, Amazon’s home category surpassed electronics in capturing the largest share of sales during the two-day promotion from July 12-13, according to market research firm YipitData Insights. During the event, share of U.S. sales from home were more than 20% of total, surpassing both the sector’s performance in 2021 and 2020.

More than a third of Amazon’s home GMV (gross merchandise value) on Prime Day ’22 was generated by sales from the kitchen & dining category.  Vacuums & floor care saw the largest boost in sales (5.8% share of sales on non-Prime Days to 21% this Prime Day). GMV for bedding and bath were lower during Prime Days than on a typical day.

Within the home category, Amazon’s private-label brand share has decreased year-over-year on Prime Days. Private label bedding claimed only 3.4% in share of sales this year, almost half o

f its share of sales from last year’s Prime Day.

MORE

Home goods a hit for Amazon’s biggest-ever Prime Day event

Nick Daniel

Brooklyn, N.Y. – Etsy has promoted from within to fill the role of chief product officer.

The position is going to Nick Daniel, currently VP of product management. He succeeds Kruti Patel Goyal, who will become CEO of the company’s Depop subsidiary, a global fashion resale marketplace, effective Sept. 12.

Daniel has been with Etsy for more than eight years and has led highly technical, complex and cross-functional initiatives. He championed the expansion and optimization of Etsy Ads and oversaw efforts to create a more personalized shopping experience, improve the selling platform and scale Etsy’s marketing technology capabilities.

Since joining Etsy in 2014, he has held multiple roles of increasing responsibilities, including overseeing the development of Etsy’s selling platform, advertising products, marketing technology, data enablement, product enablement and personalization products. Prior to joining Etsy, he worked in sales engineering at Google and, earlier in his career, held various consulting and software development roles.

“Nick is an Etsy veteran who has led some of our most impactful product initiatives that have enabled sellers to grow their businesses and drive more sales,” said Etsy Inc. CEO Josh Silverman.

Said Daniel: “Etsy’s product development culture enables us to rapidly test new features, respond to evolving customer needs and harness the power of technology to foster human connections. I look forward to working with the teams as we continue to create a differentiated shopping experience for buyers while bringing new opportunities to millions of creative entrepreneurs around the world.”

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