CHICAGO, May 18, 2016 /PRNewswire/ -- North America's fast-growing Second 500 web merchants—e-retailers ranked 501-1,000 based on their 2015 online sales—are proving that small can indeed be mighty. As the data released today in the Internet Retailer 2016 Second 500 show, these mid-tier e-retailers grew their online sales last year by 14.9% to $7.0 billion, actually outgrowing for the first time their much larger Top 500 competitors, who grew at 13.5%. With Amazon now owning roughly a third of the U.S. e-retail market, smaller web merchants are forced to rethink their strategies to succeed online. The fruits of their efforts are chronicled in the 6th edition of the Second 500, which is available in a 320-page print or interactive digital format with 71 metrics tallied per ranked retailer, or as a fully customizable online database version that lets you sort through and analyze 276 metrics for a total of 138,000 competitive e-retailing facts, including the names and company contact information on 1,313 e-commerce executives.
To achieve these growth numbers, the small- to mid-size e-retailers in the Second 500 had to overcome the challenges that their larger rivals in the Top 500 pose with their bigger marketing budgets and brand equity. Some of them, like the top 3 fastest-growing e-retailers (all web-only purveyors of food ingredients for meals to prepare at home)—Home Chef (no. 813), Thrive Market (no. 547), and Green Chef Corp. (no. 831)—courted venture capital funding to boost their technology and marketing investments and defray customer acquisition costs. (Incidentally, these three web merchants, about two years old each, have raised a total of $57.5 million in venture capital to help fuel that growth.)
Other Second 500 web merchants decided early on to embrace certain marketplaces and channels, seizing new ways of getting their products in front of online shoppers. For no. 571-ranked iBuyOfficeSupply.com, being among the first in the office supplies sector to sell on the Jet.com marketplace has paid off considerably. The purveyor of office supplies brought in $23.3 million in sales last year and has been growing at nearly 50% per year for the past three years; 5-10% of its total sales stem from Jet.com.
For long-term viability in their particular niches, Second 500 web merchants have been developing the right products to support that niche and growing their businesses to scale through careful investments in technology and marketing channels. For example, 356 Second 500 merchants now run a website optimized for mobile devices, up significantly from 283 in 2015. Collectively, the Second 500 web merchants boosted their collective monthly paid search spend by 14% to $12.1 million from $10.6 million.
"All e-commerce executives need to track the competitive performance of the lesser-known but very innovative e-retailers detailed in the 2016 Second 500, because this second-tier market is a laboratory from which new e-retailing methods and stars emerge," says Jack Love, Internet Retailer publisher.
For research information, contact: Stefany Moore, director of research, Internet Retailer, at 312.572.6282 or email@example.com.
For media inquiries, contact: Anna Applegate, corporate marketing communications, Internet Retailer, at 312.572.6264 or firstname.lastname@example.org.
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SOURCE Internet Retailer