Featured Seller – December 2017 – Homesquare

Homesquare.com is one of the largest Furniture focused e-commerce companies specializing in the Home Furniture.  Established in 2004 the company has focused on evolving to the ever-changing landscape within the eCommerce industry.  Over the last four years, the company has strategically been shifting its focus from traditional eCommerce towards the ever-growing power of Marketplaces like Sears.com.  It has developed individual strategies for each of the marketplaces as each ecosystem is significantly different and requires a different approach.  The foundation of all of this is off technology and how to sell over 350,000 SKU’s efficiently and most importantly at a profitable model.

Homesquare joined Sears Marketplace as we viewed it and still do view it as a top 5 Marketplace opportunity with a market demographic that does not cannibalize our offerings against other marketplaces.  This is paramount to strategy to avoid the inevitable price wars that come with cannibalization.  Sears also provided an integration platform that is first class and technically advanced to incorporate our back-end tech that we run to remain competitive within the market so they can offer the right products to their demographics at the right pricing.

Marketplaces are attractive to e-commerce retailers like Homesquare because they offer a known factor of cost to sell an item.  This was a fundamental reason for focusing on Marketplaces like Sears for our company.  Selling through traditional e-commerce became very expensive in terms of advertising and having to advertise in every part of the research and buying funnel with the likes of Google, Bing etc.  Combine this with significant cost increases to win bids on search engine simply was squeezing too hard.  With a fixed cost commission for Customer Acquisition that you get through Marketplaces, it makes it a lot more attractive.  Finally, Homesquare saw the move of the consumer base tending towards Marketplaces too.  Sears drives a lot of traffic both organically and paid so it sets up very well.  This allows Homesquare to focus on supply chain, their tech stack and the things they are primarily very good at.  The result is that we harmonize well with Sears bringing the customers into the marketplace and they can represent their brand well by focusing on the product and everything that is involved in getting to the consumer.

Homesquare has learned a great deal working in Marketplaces like Sears.  They learned that simply putting up 350,000 SKU’s and taking a shotgun approach is not the answer for success.  Starting out small enough to be able to monitor each SKU’s performance and profitability is key.  This allows you to build a tech stack that is robust and efficient to ensure you are pushing the right products and the right information.  It also allows you fully understand the fulfillment side which is very complicated.  On the fulfillment side, Homesquare doesn’t use just one carrier for all goods and orders.  It uses Freightclub.com , which has over 120 carriers to fulfill all the lanes and service levels.  Being in drop-ship it is critical to have a freight network that can pick-up and deliver from anywhere to anywhere and Freightclub was really the only option for this piece of the business in order to be successful.

Marketplaces present a great opportunity and Sears is a premier Marketplace which makes up a significant part of our business.  Start slow, monitor, adjust, and be flexible.  Do those things and they Sears can be a significant part of your growth plans well into the future.