Dr. Patrick Michael Byrne, the Chairman and CEO of Overstock.com, Inc. (OSTK), Interviews with The Wall Street Transcript
67 WALL STREET, New York - September 3, 2013 - The Wall Street Transcript has just published its Retail Report offering a timely review of the sector to serious investors and industry executives. This special feature contains expert industry commentary through in-depth interviews with public company CEOs and Equity Analysts. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.
Topics covered: Brick-And-Mortar Versus Online Retail Sales - Cautious Consumer Spending - Strong Secular Growth in E-Commerce - Competition From Big-Box Retailers
Companies include: Overstock.com Inc. (OSTK)
In the following excerpt from the Retail Report, the Chairman and CEO of Overstock.com, Inc. (OSTK) discusses company strategy and the outlook for this vital industry:
TWST: Over the years you have added products and offerings. You added cars, and then O.biz, for example. Are you looking at expanding into other areas still?
Dr. Byrne: Yes, we are. There is one big one I'd really like to do. I can't disclose it yet, but it is something we might get around to doing in the next year or two. I want to mention that we have a fabulous loyalty program, called ClubO. We introduced it before Amazon did Amazon Prime, but we really didn't get it right until 2010. It's contributing a significant share of our profits. Now that we are getting hundreds of thousands of customers tied into us through our loyalty program, we are looking at other ways they spend money, and then we are going out and deciding which of those other things they spend lots of money on can we bring to them even more cheaply than they can find it themselves.
We are continuing the current business model, but that loyalty program, Club O, is going gangbusters; it's the best loyalty program on the Internet. You pay $20 a year, and then you get between 5% and 25% rewards on what you buy. ClubO a significant part in that strategy.
TWST: Another one of your offerings is Worldstock. Can you talk about Worldstock a little bit and tell us why it is important?
Dr. Byrne: Worldstock is the single best idea of my life. It came to me in June of 2001. I had just spent 18 months building this supply chain that could work with fragmented supply, small lots of excess goods. I needed my first break, and so I went motorcycling around Cambodia. I saw a lot of villages where people who had lost arms and legs and eyes and such to land mines were getting retrained as potters and silversmiths and weavers. I wondered why these products were not in the American retail system.
I realized that the answer is that the American retail system is all about mass quantities. It is difficult to capture mass efficiencies when you are dealing with artisans from whom you are buying 10 of this and 12 of that, and five of this and 30 of something else. That just doesn't work for mass retail. Although we are in a sense a mass merchant - our store looks like a mass merchant - our supply chain is much more nimble than a typical mass merchant, because we are...
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