NEWS: Overstock CEO says retail business is thriving

NEWS

ONE YEAR AT THE HELM, OVERSTOCK CEO SAYS RETAIL BUSINESS IS THRIVING

By Anne Flynn Wear

It’s been a year since Jonathan Johnson took over the reins as CEO of Overstock after company founder Patrick Byrne stepped down. A year later, under Johnson’s leadership, the company recently posted 109% growth in its Q2 earnings report. “When I became CEO, it’s the first time I had been involved in the day-today of retail in six years,” Johnson told HFN sister publication Furniture Today. “At that point, the company was focusing on 27 different initiatives. It had lost focus. I whittled that down to four initiatives, which felt like the right number to achieve sustainable growth.” For some perspective, the company lost 19% in last year’s fourth quarter and then 6% in this year’s first quarter before posting the record second-quarter growth. Johnson believes the pandemic helped move up the company’s profitability by a quarter or two. In fact, at one point in the recent past, under Byrne’s leadership, the retail portion of Overstock was reportedly up for sale, but that is no longer the case, according to Johnson. “It is growing, thriving and is the driving engine of the business,” Johnson said. “No, the retail business is not for sale.”

During the pandemic, Overstock has focused on more customer self-service automation and adding resources that proved to be helpful when sales doubled over the past several months. The company hired hundreds of new call center agents as well as tech analysts, statisticians and pricing experts.

“We found some great talent in industries that had been hurt by the pandemic such as gaming, hospitality and travel,” he said. The pandemic caused a critical tipping point for online shopping, Johnson believes, and a lot of companies figured out how to more easily source and ship furniture. Overall, he believes society has become less suspicious of e-commerce. CEO Jonathan Johnson says Overstock is a huge part of who he is.

Overstock also recently entered into a new contract with the U.S. government’s general services division, which could prove to be very lucrative. Johnson said that the government agencies are pleased with how quickly it’s being developed and, once it starts to get traction, the contract could become a prominent part of the business. But, at its heart, Johnson said Overstock is a tech company, and it will continue to look to technology innovation to drive future growth. “Our goal is dream homes for all. Our core business involves catering to what we call ‘savvy shoppers’ and ‘reluctant refreshers,’ and those two groups have a natural affinity for Overstock,” Johnson said. “In that space, we believe there’s a lot of growth potential.” For Overstock, April, May and June were like turning Black Friday and Cyber Monday on with a light switch, and now it is gearing up for the upcoming holiday season. Johnson said he’s pleased with how the team kept pace; although they had some troubles keeping things in stock, he said it’s now starting to level off. “It’s been challenging to not be able to meet in person due to the pandemic,” Johnson said. “I can’t wait to get back and go to furniture markets, talk to suppliers and do the things that merchants do.” His current plan is to remain at Overstock’s helm for the foreseeable future. Johnson was previously president for five years and also briefly acted as CEO when the founder got sick in 2013. Since the start of the pandemic, he has also focused on improving the company culture. To that end, he communicates often with employees, sending out a letter at least once a week to the entire team for the past 24 weeks. In fact, Johnson said Overstock is a huge part of who he is. “I bleed Overstock red.”

Editor’s note: Jonathan Johnson will be speaking around the topic “The Future of E-commerce” at Furniture Today’s virtual Leadership Conference Wednesday, Dec. 2. For more information, please visit leadershipcon.com.