Wayfair CEO Niraj Shah shared his take on expanding the home furnishings e-commerce brand in a recent interview with Furniture Today. “Unlike the brick-and-mortar home goods market, where inventory constraints necessitated a high degree of fragmentation, we believe the online market for home, like much of e-commerce, will be a winner-take-most industry,” Shah tells the magazine. “We believe home is one of the few segments of general merchandise that is both unbranded and where much of the share shift to online is still to come, creating a very compelling opportunity.”
Some of the takeaways from the interview are:
“Continuing rapid sales growth and steadily improving earnings results from its primary U.S. operations" means that the company is bringing its proven tactics to international markets, particularly Canada, in 2016. As EAL reported, Wayfair launched its Canadian site recently. “We are already seeing a significant ramp in Canadian orders from simply tailoring the site to the local market,” Shah said.
The company posted “positive free cash flow for the third consecutive quarter and had positive adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) for the first time since it went public. That put the retailer ahead of its goal of hitting positive EBITDA by the end of the year,” reported the magazine.
The company is expanding faster than its advertising budget, with its advertising expenditures growing 45 percent last year to $278 million, while net revenue jumped 71 percent for the year; its fourth quarter active customer base grew 67 percent, and its repeat business grew 96 percent.
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