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SALT LAKE CITY – The rebrand of e-commerce home furnishings specialist Overstock to Bed Bath & Beyond six weeks ago is moving the needle, just not quite enough yet to push it into positive sales territory.
The company – which completed the acquisition of the Bed Bath & Beyond brand and its intellectual property on June 28 – shared a preview of its third quarter performance through Sept. 4. The new quarter began on July 1, so the data covers one month (July) when the platform was still branded as Overstock. It also includes sales from the much smaller bedbathandbeyond.ca platform in Canada, which relaunched on June 29.
Bed Bath & Beyond/Overstock has bulked up on SKUs to pull in former BBB customers, but so far revenue is still lagging. Third quarter revenue declined in the mid-teens on a year-over-year basis. That includes a low-double-digit percent decline year-over-year since the U.S. launch.
Average order value is also down. For the quarter, average order value declined in the high-teens percent year-over-year. That includes a low-20s percent decline year-over-year since the U.S. launch.
Still, company CEO Jonathan Johnson said he remains optimistic about the future and the opportunity to gain market share under the Bed Bath & Beyond brand.
“Even in a challenging macro-economic environment, we acquired new customers and re-activated past customers. Our topline performance is improving steadily,” he said.
Key third quarter highlights:
- Over the Labor Day weekend, the first major holiday event under the re-brand, the legacy BBB categories of bedding, bath and kitchen recorded strong growth year-over-year in aggregate, for the comparable period.
- The company has added nearly 1.3 million new SKUs since early June as it built out key BBB category assortments.
- The e-commerce site saw a mid-single-digit percent net increase in active customers since the launch.
- Total active customers for the 12 months ended Sept. 4 came in at more than 4.8 million.
- The pace of orders has also improved. The new BBB has generated a mid-single-digit percent growth year-over-year. That includes a high-teens percent growth year-over-year since the U.S. launch.
- Gross profit as percent of revenue came in at approximately 18%. Sales & marketing expense as percent of revenue was approximately 15%
“Visits to our website have increased and conversion has improved,” said Johnson. “Our promotional offers and expanded product assortment are resonating with customers, and they love the refreshed mobile app.”
The company will provide full results when it reports Q3 earnings this fall, most likely in late October or early November.
