With one of the world's largest online selections of furniture, home furnishings, décor and goods, including more than seven million products from over 7,000 suppliers, Wayfair needs to be at the top of its game to spark customer engagement and brand advocacy.
And Wayfair is getting it done online in a variety of ways that has led to customer acquisition and customer loyalty.
Here’s a snapshot of its first-quarter performance:
Wayfair generated $747 million in net revenue, an increase of 76% over the same period last year.
Its Direct Retail business, which comprises 95% of the total, increased by $342 million to $712 million, representing 93% growth.
Wayfair’s total active customer count also reached 6.1 million customers.
“The growth in our Direct Retail business is led by Wayfair.com in the U.S., where we believe we are taking an increasing share of the dollars moving online in our categories,” Wayfair CEO Niraj Shah said during the first-quarter earnings call on Monday, according to Seeking Alpha. “There are many factors that drive that exceptional growth, our superior product selection and inspiring visual merchandising, our competitive price points for the mass-market customer, our use of technology to enable seamless purchasing of goods online, and our advertising and brand investments that are introducing more customers to the Wayfair brand.”
Shah noted that this strategy has led to increased repeat purchase behavior from Wayfair customers that continues to outpace new customers.
Wayfair’s international markets, particularly Canada and Europe, continue to perform well.
“One thing we probably have and emphasized enough is that we’ve been executing in these geographies for quite some time, operating sites in the U.K. since 2008 and Germany since 2009, and serving Canada through our U.S. sites since 2008,” Shah said. “We maintained a small team on the ground in Europe since 2008 to work on the U.K and German sites to develop local supply relationships and to provide customer service. However, the team there remain subscale as we made the conscious decision to focus our efforts on the U.S. market as we transition from hundreds of niche websites to a fully brandedWayfair.com site. Once the U.S. transition to Wayfair.com is going well by which we mean strong revenue growth and gross margins, we started laying even more groundwork in Europe in 2014.”
Today, Shah added, “because the underlying architecture is fully global, we can create a new product once in the catalog and use it in multiple geographies, languages, and currencies. Our focus in 2015 and 2016 has been on developing additional European supply relationships to broaden and deepen the product catalog and building out the logistics infrastructure in carrier relationships to ensure a great delivery experience for customers. We feel that we’re far enough along with the overall offering in the U.K. that we’ve now started to invest with confidence in ad spend for new customer growth and to build the Wayfair brand. The proprietary advertising technology stack developed by our U.S. marketing team and engineers is also being applied in Europe.”