“We were sitting here Friday morning thinking we wouldn’t break it, and we ended up doing $2 million more than our all-time record,” Catch Group CEO Nati Harpaz told IR.
“It’s just unbelievable.”
Even with a large, automated distribution centre like the one Catch operates in Melbourne, Harpaz said the warehouse team was working around the clock to handle the unprecedented volume, as sales continued to stream in over the weekend.
“Our challenge now is to get all the orders out,” he said.
Strong second quarter
Harpaz attributed the impressive turnover to Catch’s investment over the past two years in a more sophisticated marketing and customer database approach, as well as its marketplace, which now carries more than 1.9 million SKUs from over 950 third-party sellers, including Tarocash, Ezibuy and Alannah Hill.
The record-breaking sales day is expected to drive another quarter of significant growth for the online retailer, which recently reported $99.39 million in gross transaction value (GTV) in the first quarter of fiscal 2019, up 72.9 per cent from the previous corresponding period.
Harpaz said Catch Group is expecting second quarter GTV, which includes Christmas trading, to be up in the “significant double-digits” on the same period last year.
Sales at Catch’s pop-up shop at Chadstone shopping centre, which opened in October and will trade through January, are also “very, very strong”, according to Harpaz.
Bricks-and-mortar: “not easy”
Just a few weeks after opening, Catch made the decision to double the footprint of the store, and Harpaz said the company is now considering rolling out similar pop-ups at other shopping centres around Australia.
“It’s not easy to execute,” he admitted.
“There are so many considerations when you run a bricks-and-mortar that you don’t have when you run online. There’s significant investment in design, putting up the store, display, replenishment and staffing.
“Unless you have a very clear goal of what you want to achieve, it’s difficult,” he said.
IPO to be revisited next year
For Catch, the goal is clear: marketing.
It has been widely rumoured the online retailer is pursuing an IPO, and some have speculated the pop-up is meant to demonstrate consumer loyalty to investors, but Harpaz downplayed the talk of floating.
“We have never announced an IPO,” he said.
“We did a non-deal round and talked to investors, but haven’t made a decision. We’ll probably revisit next year.”
IR understands the group is looking to wait until market conditions improve.
Meanwhile, has the pop-up experience given Harpaz more insight into the challenges that bricks-and-mortar retailers are facing? Not necessarily.
“You can definitely do a combination of bricks-and-mortar and online business profitably, but retail is all about your location and where you’re distributing. The days of having lots of stores everywhere are gone. Customers no longer need that geographic proximity,” he said.
“What you can’t do is have over-priced product and think because you have a fancy-looking store that customers will overpay. The competition has become hard, especially online. You have to provide a good experience and value for money.”
Nati Harpaz is a co-founder of Octomedia, Inside Retail’s parent company.