Bed Bath & Beyond shares omnichannel insights
The new fiscal year is off to a good start at Bed Bath & Beyond according to CEO Steve Temares who credits a wide range of omnichannel initiatives.
Sales in Bed Bath & Beyond’s first quarter ended May 30, increased 3.1% to $2.738 billion and same store sales increased 2.2%. Net income declined to $158.5 million from $187.1 million while a strong stock buyback program allowed earnings per share to remain flat.
Profit pressures were caused by increased couponing as well as investments, many of which are in the technology area, Temares said are necessary to thrive in an ever-evolving retail environment.
“During the first quarter, comparable sales consummated through customer-facing Web sites and mobile applications grew in excess of 35%, while comparable sales consummated in stores were relatively flat,” Temares said during the company’s first quarter conference call. “Our digital channels have benefited from the investments made to date, and we continue to test and add new functionality to our Web sites and apps.”
The company is expecting its digital growth rates to moderate somewhat later this year as it anniversaries key milestones such as the relaunch of its namesake Web site and free shipping offer for order more than $49.
“The evolution of omnichannel retailing has created a more seamless and personalized shopping experience for customers. At Bed Bath & Beyond we have been committed to creating such an experience for quite some time. For example, we have been leveraging our stores for order fulfillment for more than a decade,” Temares said.
Other omnichannel efforts underway at the company include:
• Leveraging a proprietary Web-based in store channel called the Beyond Store to provide an endless aisle experience with roughly 220,000 products available while continuing to accept in store returns of online orders.
• Expanding the online ranges logically. For example, earlier this year the company introduced mattresses and patio furniture online to complement inventory available in physical stores.
• Offering an expanded selection of back-to-school and back-to-college merchandise tightly integrated with digital efforts to appeal to high school and college kids. A “shop for college” section of the Bed Bath & Beyond Web site contains information about hundreds of different colleges to help students plan for what they will need while away at a particular school.
• An active social media effort with links to content, including videos, for dorm room decorating and storage tips and a college registry service so students can add items to a shareable list.
• Shop Now Ship Later. This service allows students to purchase items in advance and Bed Bath & Beyond ships when directed to align with college move-in dates.
• Continued mobile enhancements. The company recently launched express checkout with PayPal, give users the ability to ship to more than one address in a single transaction and leverage augmented reality technology with a registry called the “Wowbook.”
“To further support our mission to just take care of our customers, we are creating more flexible fulfillment options that will allow us to deliver orders more quickly and cost-effectively,” Temares said. “During the first quarter, we opened our newest Las Vegas facility and we are assessing additional sites throughout the country to gain even greater distribution efficiencies.”