SeekingAlpha, just published s story right out of Rick Schwartz Playbook and something he has expressed for years on his blog, that Sears and Staples might be more valuable as domain names than as brick and mortar stores.
“”What happens when a brick and mortar retailer’s brand becomes more valuable as a domain name than as a chain of stores?””
” We might be seeing the answer to that question at department store legend Sears Holdings (NYSE: SHLD) and office supply category killer Staples (NASDAQ: SPLS).”
The best quote from the story is “It looks as if we are seeing a new paradigm in the world of retail, one in which a brand name could be a company’s most valuable asset. I have to wonder when we will see investors and ecommerce companies purchasing retailers simply for their names.”
“Sears and Staples look like retail dinosaurs, yet both of them were among the top five online retailers in 2013, according to Internet Retailer. An interactive chart showed that Staples was number three and Sears was number five. Staples’ 2013 online revenue was $10.4 billion and Sears’ online revenue was $4.9 billion.”
“Staples’ online revenue was actually more than double that of market darling Netflix’s (NASDAQ: NFLX) TTM revenue. Netflix reported a TTM revenue of $5.19 billion on Sept. 30, 2014. Sears’ online revenue was close to that of Netflix. What’s truly interesting is that those revenues are growing as the brick and mortar business at both retailers falls.”
Online sales at Sears grew by 9% between third quarter 2013 and third quarter 2014, USA Today reported. During the same period total sales at the company fell by 13%.
Staples also reported that its online sales increased by nine percent between third quarter 2013 and third quarter 2014, Internet Retailer reported. During the same period Staples’ overall sales fell by 2.5%.
So what do these numbers really tell us?
Obviously they indicate that Sears and Staples both have a bright future online.
Their brand names are still relevant and attractive to customers. Decades of customer loyalty and a strong brand still count for something.
They also indicate that Sears and Staples seem to be cannibalizing their brick and mortar businesses to grow online.
“Sears’ CEO Eddie Lampert expressed on posts on his blog that he is thinking that Sears needs to get out of or greatly reduce its brick and mortar business.
“This blog post in particular shows what Lampert is thinking:
“With more and more of our sales and member engagement happening online or via mobile and shipping straight to home, do we need the same kinds of stock rooms and warehouses?”
The author of the story concluded that:
“It looks as if we are seeing a new paradigm in the world of retail, one in which a brand name could be a company’s most valuable asset. I have to wonder when we will see investors and ecommerce companies purchasing retailers simply for their names.”
Kassey says
Domain names Sears.com and Staples.com are now worth a fortune! Very easy to remember names.
dot_stories says
A brand name is an asset – the purchase of bugatti name is just an example.
How much do you think a “.brand” participates in the value of a brand ? It “.brand” more valuable than Brand.com ?
Louise says
It’s crazy. I know Avenue.com, one of my fav domain names and businesses, closed many of its physical stores, but still thrives online, and in the remaining stores.
Anecdotally, for me as one of Jehovah’s Witnesses, an announcement was just read from the platform to not rely on Watchtower on CDs any longer, as it is cheaper to simply download from the web. The Winesses take their tablets door-to-door, now.
IBM just released its report:
9 AM ET Alert: Cyber Monday Caps Record Five-Day “Cyber Week” Driven by Mobile Shopping
http://www-01.ibm.com/software/marketing-solutions/benchmark-hub/alert.html
which highlights:
Good news for domain investors and website developers!