Retail brands fight ‘Amazon effect’
When your industry sports a behemoth like 7-Eleven, it’s hard to escape from the shadows of the big dog’s results. While sales for the retail category as a whole decreased 1.5 percent, sales for the rest of the Top 200+ category sans 7-Eleven actually increased by 3.6 percent. Overall unit growth held strong at 4.1 percent from the prior year.
Budget Blinds, Matco Tools and Snap-on Tools were the three companies seeing year-over-year increases of 10 or more percent. After a strong sales increase of 6.2 percent in 2014, sales for Budget Blinds boomed with an 11.6 percent increase last year.
Once Upon a Child keeps moving up the rankings with consistent sales growth, as it entered our Top 200 list for the first time with an 8.4 percent increase.
Retailers have increasingly had to compete with Amazon for their sales, as the ease and convenience of shopping online is often more appealing for consumers than going to a physical store.
Top 200 retailers successfully adapting to the “Amazon effect,” and online shopping in general, have seen significant growth in their sales. Matco offers its entire tool catalog, more than 13,000 items, online for its consumers to buy. Snap-on also has a strong online presence, and offers free shipping on orders of $500 or less.
Another company fighting Amazon for sales is Batteries Plus Bulbs, which saw yet another growth in sales this year, at 7 percent.
With all the shipping logistics involved, one thing Amazon or similar online services can’t usually offer is immediate service. “When we get into the specifics of the categories that we carry, the first thing to recognize is that we are a hyper-destination business,” said Russ Reynolds, CEO of Batteries Plus Bulbs. “Most people, when they have an energy outage, don’t want to wait 48 hours to replace that battery.”
Service is also an important component for retailers like Batteries Plus Bulbs, especially since people that are unfamiliar with electronics often need products installed for them. Alongside the installation knowledge of their employees, the company introduced cell phone repair, now one of its fastest-growing subsets, in the second half of 2014.
“You’re not going to call Amazon to fix a cracked screen, or install a battery for you. That’s just not what they’re going to do,” Reynolds said.