Yahoo Finance Pandemic caused ‘huge disruption’ with shift to e-commerce: Williams-Sonoma CEO
The growth of U.S. e-commerce sales slowed in the second quarter from the breakneck pace it sustained for much of the COVID-19 pandemic, despite continued infection fears driven by the Delta variant.
But the dramatic shift to e-commerce during the pandemic amounts to a "huge disruption" that will alter the home goods market going forward, says Williams-Sonoma (WSM) CEO Laura Alber.
In a new interview, Alber told Yahoo Finance that COVID-19 accelerated the transition away from brick-and-mortar stores that had begun before last spring, and the trend has rewarded companies that foster and serve new consumer habits online.
"There's so much opportunity," says Alber, whose company oversees prominent brands like Pottery Barn and West Elm. "Because it's such a fractured market, the macro is favorable for home furnishings, and there's a huge disruption from brick and mortar to online."
Prior to the pandemic, 80% of sales in the home goods sector took place in person, Alber said.
"Even if the pandemic hadn't happened, that would never have held, with the way technology is moving," she says.
"We knew that there was going to be this huge market share gain opportunity and that that's why we needed to invest and stay very focused on omni and digital," she adds.
Williams-Sonoma excelled during the pandemic, in part because Americans under COVID-19 restrictions sought to improve their home, where they suddenly spent the bulk of their time. Also, the company effectively navigated the pivot toward a reliance on e-commerce.
Second-quarter earnings for Williams-Sonoma, released late last month, beat revenue expectations, while e-commerce accounted for 65% of total company revenue, just a slight drop from the 70% share of sales the company reached last year, Alber said.
The company's stock jumped 15% on the earnings news and has climbed 77% so far this year, as of Thursday afternoon.
Alber, who ran a small business selling hats while a student at the University of Pennsylvania, joined Williams-Sonoma in 1995 as a senior buyer in the Pottery Barn catalog division. She has served as CEO since 2010.
Speaking to Yahoo Finance, Alber said online consumer habits formed during the pandemic will serve Williams-Sonoma going forward.
"Everyone got really much more comfortable shopping online because they had to," Alber says. "You don't forget that when that works."
"The disruption from brick and mortar to online was expedited, and people like us have really benefited from that and will continue in to the future," she adds.
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