Overstock.com is piloting a new returns program with UPS that will allow Overstock customers to schedule doorstep pickup for returns of unwanted items with no re-boxing required.
The partnership will give both Overstock and UPS the “opportunity to better understand customer preferences” and “serve up options that align with their day-to-day lives,” said Overstock.com CEO Jonathan Johnson during the company’s Q3 earnings call on Oct 27, 2022.
“These post-purchase performance metrics will help us evaluate the end-to-end shopping experience for our customers,” said Johnson. “Initiatives like this one with UPS can go a long way in generating repeat business from our customers.”
The new doorstep returns pilot comes as Overstock.com completes its transition into a furniture-only online retailer, after 18 months spent exiting all non-home categories. This move seemed solid in early 2021 when the home furnishings category was booming, but as consumer spending has slowed — especially for big ticket items like furniture — Overstock and its competitors are now looking at balance sheets that are much less appealing. Total net revenue at Overstock was down 33% YoY in Q3, and fellow furniture e-tailer Wayfair is seeing similar declines, with sales down 9% from a year ago in its latest quarter, which ended Sept. 30, 2022, and customer count dropping 22.6%.
Despite these headwinds, Johnson is optimistic about Overstock’s opportunity to scale in the category. “The furniture and home furnishings market is large and fragmented, with a total addressable market of $419 billion based on third-party reporting,” he said at the earnings call. “[This] large market provides us with additional opportunities to gain market share even if online penetration remains unchanged over the near term. As the fourth-largest online retailer of home furnishings in the U.S., our ‘smart value’ brand pillar is [strategically] focused on increasing the breadth and depth of our home SKU product assortment and will help us capture market share.”
Since the start of 2021, the company has doubled its home-only assortment, and Overstock just launched its first major marketing push as a home-focused retailer. The national “C’mon, Get Comfy” campaign aims to showcase the company’s “strong vision for the future as we continue to deliver simple product findability, smart value and easy delivery and support to our customers” said Johnson in a statement.
“As we look ahead to our first holiday season as a 100% home-based retailer, our customers will be able to find everything they usually look for during this period,” said Johnson. “This holiday season is expected to be highly competitive. I’m pleased with how the team has positioned Overstock to compete. We are strategically leaning into branded gifting categories like small appliances to capture market share from struggling competitors.”