The top 20 online retailers of 2013 (alphabetically):
1. Appliances Online
It was only a few years ago the retail industry felt confident in saying people would never buy large, bulky goods over the internet. Today, John Winning’s Appliances Online is enjoying the fallout. At $20 million a year, Appliances Online is on the smaller side but not less important. The company’s success shows that Australians are willing to buy anything over the internet, as long as they’re given enough detail and enough confidence in the seller. While it might be a while before the practice becomes mainstream, Appliances Online has achieved what many thought would be impossible – and have made money at the same time.
2. Big W
While the company doesn’t divulge how much of its revenue is made online, the popularity of Big W’s site indicates it could be making quite a lot of cash. In any case, Woolworths is giving DealsDirect a run for its money with the Big W online store, which doesn’t have many frills but is focused on simplicity of use and cheaper prices.
Given books are one of the cheapest things to buy from offshore retailers, it’s surprising any local online store has managed to create a thriving business. But Tony Nash at Booktopia has been able to do just that, on track to turn over $28 million in 2012-13. There isn’t much complicated strategy here. A focus on clean design, good customer service management and an ever-present need to reduce shipping times has kept Booktopia at the top.
BrandsExclusive has been at the forefront of the private shopping club scene in Australia. The business, which has mostly focused on fashion, quickly found a loyal user base and has been growing ever since. Perhaps the company’s biggest success has been its ability to leverage demand for private shopping networks into cash. Even last year APN News & Media announced a massive $36 million stake. The business was aiming to turn over $70 million last year.
5. Catch of the Day
Perhaps the largest online retail success story in Australia, Catch of the Day continues to grow from strength to strength. After starting as an eBay business, Gabby and Hezi Leibovich have managed to transform the company into a $350 million powerhouse, complete with funding from one James Packer. Part of the success of the Catch Group can be attributed to its savvy expansion plans. Rather than start a business for every category, the team has been able to pick up start-ups and nurture success from there. After expanding into grocery and wine, it seems natural the business could continue to thrive – and all signs are pointing to an eventual float.
The largest online department store, DealsDirect started as an eBay business. (Curiously, so did the other major retailer on the list – Catch of the Day). The business has been expanding in recent years, buying a series of smaller retail-based businesses. Founder Paul Greenberg has a keen eye for businesses, and the people who run them. Although DealsDirect has been a success due its size, he’s been careful not to pack the operation with too much fat. Greenberg is cagey on revenue, but the business is doing well over $100 million.
7. Dick Smith
Placing Dick Smith on a list of the country’s top retailers may be a controversial move given what’s happened to the company. But despite Dick Smith’s downfall, it still maintains an extremely popular online presence. Why? Because it has the basics down pat. The ability to reserve products, and check individual stores for stock levels is a must. It’s simply a well-designed website, the importance of which can never be overstated.
8. EB Games
Although plenty of consumers are heading offshore to source cheaper video games, EB Games has managed to maintain a strong foothold in the local sector. A solid website, a savvy social media team, and a thinning market thanks to the collapse of GAME, have all ensured the online division of EB Games is doing just fine.
9. Get Wines Direct
The internet has triggered a boom for liquor sales, with plenty of retailers such as Woolworths, with its Dan Murphy’s brand. Get Wines Direct is topping the competition, making a name for itself as the country’s biggest online wine dealer. Founder and chief executive Tony Sells has been busily promoting the company lately with partnerships and other deals. And it’s working – the company is turning over more than $50 million.
While the group buying market has certainly fallen from its height, Groupon has kept a stronghold on the local industry. It’s the biggest player, (although Catch of the Day’s Scoopon follows closely behind), and has managed to maintain a foothold in an otherwise tumultuous market. There’s no denying the pressure facing its parent company, but for now, at least, Groupon has shown group buying is truly well and alive in Australia.
11. JB Hi-Fi
One of the larger businesses in Australia to actually understand how online retailing works; JB Hi-Fi is making a good name for itself online. With more than $37 million in digital revenue in the first half of the year alone, at 2% of total sales, the company is proving itself as a good example for dedicated bricks-and-mortar stores heading online. In fact, JB Hi-Fi perhaps encapsulates what retailers need to be doing online. With the ability to check stock, “click and collect” and some pretty fast customer service, chief executive Terry Smart seems to be doing a good job in transforming the iconic business into a powerhouse online.
If not the most popular, Kogan is one of the best-known homegrown online retailers in Australia. Mostly thanks to founder and CEO Ruslan Kogan’s insistence on putting himself and his business in the news through quirky – and sometimes weird – comments and campaigns.` It’s difficult not to be impressed by Kogan’s reach. After shipping a single container of televisions five years ago, Kogan has transformed into a $250 million business with more on the way. Spars with Gerry Harvey aside, Kogan has maintained a solid footing with Ruslan saying he’s “happy to be everybody’s first choice for a second television”. With a view to growing into a billion-dollar business, and expansion into services like mobile, Kogan will be around for a while yet.
13. Milan Direct
The other half of Ruslan Kogan’s online empire, Milan Direct was initially an odd proposition. Selling furniture online back in 2007 wasn’t done very much in Australia, if at all. But Dean Ramler and Kogan have managed to turn the business into a $12 million powerhouse. The company’s success has spawned some eager competitors. But with growth of 100% last year, and international expansion ahead, Milan Direct seems set to hold on to its strong market position for a while.
Office supplies are a boring topic, but Officeworks has at least managed to make the buying process as easy as it can. After all, office
supplies are something you should be able to buy online instead of heading to a store.
The company won’t confirm how much revenue the business makes online, although reports indicate it could be anywhere up to $150 million, equivalent to 13-14% of revenue. That’s an astonishing figure for an office supplies store, but it does make sense – the company understands how people shop online.
Just like JB Hi-Fi, Officeworks shows it understands how to not only get people browsing on a site, but makes sure it knows how to capture their money.
The other half of Australia’s private shopping scene, Ozsale has been just as successful in establishing a dominant presence in the local retail sector.
Founded by Jamie Jackson, the company has succeeded in building a solid reputation. It’s been a busy year for the company, too, as it snapped up competitor BuyInvite back in June 2012.
The company isn’t slowing down plans, announcing earlier this year it’s gearing up for an IPO.
16. Shoes of Prey
The customisable shoe retailer has made quite a name for itself. With plenty of attention from television shows, and some inadvertent celebrity endorsements, Shoes of Prey has ended up as one of the hottest brands in Australian retail.
Some funding hasn’t hurt, either. The company has taken money not only from Atlassian co-founder Mike Cannon-Brookes, but TechCrunch founder Mike Arrington. A partnership with David Jones is sure to increase the company’s reputation among the bricks-and-mortar elite.
Although revenue isn’t the highest in the online space, the company has definitely made an impression. It won’t be going away soon.
17. Specialty Fashion Group
While the retail and fashion industries obviously haven’t been having the best time, Speciality Fashion has been working on its digital presence – and it’s doing very well.
The company, which operates the Millers, Katies and Crossroads brands, recorded $11.3 million in online revenue during the first half of the year, representing 3.6% of total value.
While it isn’t the biggest online retailer around, the fact the company has been so successful with its digital push – and is willing to disclose just how much money it makes online – is a good step in the right direction.
Another online shoe business, StyleTread is all about shipping. When the company first launched, SmartCompany spoke to the founders – who said shipping was their number one priority. The business raised $4 million back in 2011 from Nine Entertainment, and then won $12 million from more investors last year.
It’s a good strategy, given how frustrated Australian shoppers have been for some decent delivery times. As a result, StyleTread has continued to grow.
19. The Iconic
Although The Iconic isn’t one of the most established businesses around, and while it certainly isn’t divulging much with regard to revenue, it seems outrageous to leave the company off a list detailing the most important online retailers in Australia.
The business has made a huge splash in Australia with its bright marketing tactics, but it’s also gained a reputation for securing not only one $25 million funding round, but a second earlier this year.
The Iconic certainly has enough money to make a dent on the online retail market. It remains to be seen whether that success will continue.
It’s been a couple of years now since the shopping giant announced it would create its own online hub for shopping digitally. Now, it’s one of the most popular online retail destinations in the country.
It was a smart idea. The site combines deals from various stores located in Westfield shopping centres. A savvy website, along with the ability for free delivery and returns in-store or online, has kept Westfield in a strong position online.