Everyone was relying on e-commerce giant Overstock.com closing its doors for the last time in early 2020. The business stock was the lowest in history on March 13, 2020, the day America declared a state of emergency facing the rising threat of the coronavirus and the beginning of the COVID-19 pandemic.
Now, with two years of pandemic lifestyle behind us, Overstock.com is hitting performance records never before seen in the company’s history. Its stock value has risen over 2000%, and the once doomed e-commerce business is leaving competitors in the dust.
An original Overstock executive, Jonathan Johnson, took the ship’s helm just before the pandemic shutdown. Johnson had been with the company since the outset in 1999. Still, he had spent the previous six years leading up to his assuming the CEO position in 2020 at Medici Ventures, a blockchain-focused Overstock investment subsidiary.
Johnson spoke to Deseret News following his CEO appointment, “In 2019, it is a much more mature market with numerous bigger players. Overstock has found a great niche focusing on home goods, and the business has turned around in the last quarter. There is certainly a place in the market for Overstock to grow and thrive, be profitable, and generate positive cash flow. We see a bright future for retail.”
That future that Johnson spoke about came sooner than anyone might have imagined. Covid-19 quarantines and home isolation led to a historically significant spike in online shopping trends. With people locked inside, online shopping became an everyday consumer behavior. Everyone had to shop online, and Johnson positioned Overstock.com to take advantage of the moment.
“When I became CEO, Overstock was losing market share, shrinking and losing money,” Johnson said. “It was clear to me we needed to regain focus on what we do best and bring value to our shareholders.”
Prior leaders at Overstock.com had created a culture of micromanagement that Johnson did away with immediately, allowing leaders within the company that were the closest to major operational issues the room to handle the problems themselves. This change led to a transformation in company culture. Along with implementing a four-point simplified roadmap focused on hitting objectives and measuring success through specific results metrics, Jonathan Johnson gave Overstock.com a new road to travel with clarity of purpose throughout every facet of the business.
Then, with the onset of the pandemic, business sharply increased. Covid-19 limitations and restrictions assisted Overstock’s wildly massive growth. The increase was not only seen in consumers purchasing small goods. The furniture and home furnishings business took off as well.
“Over the last decade, the home furnishing market has been migrating to online sales at a rate of about 1% to 2% a year,” Johnson told the Deseret News in August 2020. “At the end of 2019, about 23% of those purchases were online.
“The pandemic has accelerated that, and what have been three to five years of growth has happened in months. We’re now looking at about 36% of purchases happening online.”
Many shoppers also found new ways of purchasing larger items like furniture during the pandemic that assisted Overstock in its growth. Before pandemic, businesses offered few financing options to consumers other than a basic credit card. With so many people out of a job and conserving their spending, raking in high-interest rates and compounding credit card debt was not an option—new ways to purchase larger items needed to be found.
Luckily, two rounds of stimulus checks and generous unemployment benefits helped boost American spending, but another way of financing big buys was gaining steam during the pandemic.
Buy now, pay later (BNPL) platforms like Affirm, Sezzle, Credova, and Afterpay have taken center stage recently. These BNPL platforms allow everyday consumers a viable option for financing must-needed purchases by integrating with retailers at the point-of-sale. Consumers complete their purchase in real-time with the ability to pay it off in small, monthly installments over an agreed amount of time in the future.
For online retailers like Overstock.com, buy now, pay later financing options from Credova and other similar financing businesses have become the go-to choice. Without these financing options for consumers, Overstock and other major online market retailers might not have seen the incredible jump in sales that they experienced during the pandemic.
BNPL options from companies like Credova support consumer spending with their ability to forego interest rate charges on most purchases if consumers meet promotional financing requirements. Consumers are jumping at the opportunity to use these financing options, and more and more merchants are teaming with BNPL platforms like Credova every day. Merchants and retailers alike recognize the benefit of this new way to pay.
Jonathan Johnson took Overstock.com back to the top by capitalizing on the moment and trusting that his leadership would follow suit. Johnson would have turned Overstock.com back into an industry leader over time. Still, by implementing smart changes upon his return, utilizing new consumer financing options through BNPL platforms similar to Credova, and trusting his team to follow through, Johnson created a space for Overstock to skyrocket and do in two years what most would have done in ten.