PetMed Express’s web sales fall
January 21, 2015 02:34 PM
Web sales continued to fall at pet medications and pet supplies retailer PetMed Express Inc. in the third quarter of fiscal 2015.
PetMed Express does not break out web sales in dollars. However, based on percentages the company reported, web sales dropped 0.4% year over year, to $39.427 million in Q3 2015 versus $39.568 million a year prior. 80% of the retailer’s sales come from the web. The rest are phone orders.
PetMed Express, which sells through 1800PetMeds.com, is No. 152 in the Internet Retailer 2014 Top 500 Guide.
For the 2015 fiscal third quarter ended Dec. 31, PetMed Express reported:
- Overall sales dropped 1.6% year over year, falling to $49.3 million in Q3 2015 from $50.1 million during the same period last year.
- Based on percentages the company reported, web sales dropped 0.4% year over year, to $39.427 million in Q3 2015 versus $39.568 million a year prior
- Net income rose 6.6% for the quarter, to $4.8 million from $4.5 million during the same period last year, something CEO and president Menderes Akdag attributed to sales shifting to higher margin items.
The overall and web sales declines could be due to a sharp drop in the retailer’s ability to attract new customers, Akdag said during a conference call with analysts. The company acquired 96,000 new customers during the quarter, down 15.8% from 114,000 during the same period last year. While the number of new customers was down, the advertising cost of acquiring a new customer rose 12.5% to $45, from $40 a year prior. PetMed Express’ CFO Bruce Rosenbloom tells Internet Retailer it is working on lowering customer acquisition costs.
It wasn’t all bad news during the quarter though. One bright spot for the retailer was that its average order value rose 5.6% to $76 compared to $72 a year earlier.
To bolster the retailer’s business, PetMed Express plans to improve its advertising efforts in the fourth quarter, including running a new campaign.
For the first nine months of its fiscal year, PetMed Express reported:
- Overall sales of $179.4 million, down 2.9% from $184.8 million during the same period last year.
- Net income of $12.50 million, down 7% from $13.45 million during the same period last year.
- Overall advertising spending of $21.1 million, down 3.7% from $21.9 million the year before.