Retail

Online Retailers Stealing Bricks And Mortar Business

5. Diapers.com
> Product: diapers
> Competition: Walmart

Diapers.com is the self-described “largest online baby care specialty site in the United States.” In December 2010, the site was acquired by Amazon.com, at which point Diapers.com had about half a million customers. According to a Reuters article published in November 2010, Amazon’s acquisition of Diapers.com posed a real threat to big-box retailers such as Walmart and Costco (NASDAQ: COST), which are major players in that market.

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6. Bonobos
> Product: men’s apparel
> Competition: Macy’s

Bonobos is a men’s apparel company, best known for its pants. Since its launch in 2007, the site has been extremely successful at making sales and raising funds. In December 2010, it received $18.5 million in funding. The company’s success is due partly to its products, and partly to its Zappos-like customer service system, which offers free shipping and an easy return policy. Site awareness has been driven by email, on-site messaging, ads and social media.

7. Amazon.com
> Product: Kindle
> Competition: Barnes & Noble, Best Buy

Amazon’s majority share of the U.S. book market has long been established. The company can take some of the credit for the bankruptcy of Borders Group. Barnes & Noble (NYSE: BKS) is currently feeling pain due to the popularity of Amazon’s Kindle, which has continually outpaced the Nook in total sales. Amazon is also a threat to electronics companies such as Best Buy. According to a Wells Fargo study, Amazon beats bricks-and-mortar retailers across the board when it comes to average electronics prices.

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8. Warby Parker
> Product: eyewear
> Competition: Sunglass Hut, LensCrafters

Eyeglass company Warby Parker was a smash success immediately after its 2009 launch. According to Advertising Age, the company “hit its first-year sales target in three weeks, sold out of its top 15 styles and had a wait list of 20,000 customers after a month in business.” The company sells fashionable frames at a flat price of $95 and, for every pair sold, it donates a pair to people in need.

Charles B. Stockdale