To Counter Every “Retail Revenue Is Down” Argument, There’s Amazon
Written by Evan SchumanFor many retailers, flat or minuscule in-store revenue increases are becoming the norm, with online increases the only thing that looks bright. Mobile is going to quickly fall into that category (although a percentage increase for anything as new as mobile is meaningless, it still looks cool on an earnings report). But how can this work given the small revenue percentage E-Commerce still controls? Let’s take a look at Amazon’s latest numbers (which look pretty much like all of its numbers.)
The king of E-Commerce reported on Thursday (Jan. 28) a 42-percent increase in net sales for the fourth quarter just ended, along with a net sales increase of 28 percent for the whole year, to $24.5 billion. (To be precise, it’s actually 29 percent if you exclude a $182 million unfavorable impact from year-over-year changes in foreign exchange rates throughout the year, the company reports.) Sure, you say, but revenues are not the point. What about profits? Net income soared 71 percent (to $384 million) for the quarter and 40 percent (to $902 million) for the year. Amazon’s official guidance for the first quarter 2010 is equally rosy, suggesting a sales increase of as much as 43 percent. For those arguing that E-Commerce will always be a footnote to in-store, these numbers are hard to ignore.
One Comment | Read To Counter Every “Retail Revenue Is Down” Argument, There’s Amazon
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February 1st, 2010 at 8:52 pm
We knew that online would be the bright spot in the retail roadmap. Amazon executes at such a high level. It’s not customer service, it’s customer engagement. Sites like Amazon, Zappos and Overstock.com deliver much more than product. It’s become pop culture to shop at these stores and a certain degree of hipness is associated with these retailers. It’s so darn cool to shop them how could you not? If anything, bricks and mortar retail has become a different beast and is no longer in the same realm as online shopping.