Drugstore.com sees ample opportunity

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BELLEVUE, Wash. — Drugstore.com says the proliferation of mobile applications and social media will help its sales climb to at least $750 million by 2013.

The online retailer, which also operates the sites beauty.com, skinstore.com and visiondirect.com, has continually posted strong and growing sales numbers, but it has yet to report an annual profit.

Executives say that in 2013 drugstore.com expects to get more than $660 million from its nonvision businesses and $90 million from its vision operation.

Net income for the year is expected to be $15 million, and ongoing adjusted earnings before interest, taxes, depreciation and amortization is forecast to be at least $41 million.

“Our market opportunity is expansive and, although we are facing a competitive environment with margin pressure, I believe that we are executing on our strategy to strengthen and grow our leadership position,” chief executive officer Dawn Lepore stated during the company’s Analyst Day meeting with Wall Street analysts in New York last month.

At that event, Lepore outlined drugstore.com’s growth strategy, saying that it would focus on retaining and expanding its customer base, leveraging emerging marketing channels and increasing its reach into new market segments.

She said the company plans to expand its use of mobile technology and social media, including the Facebook store that it launched last month.

“Ultimately, we are using social networking to drive business,” chief marketing officer David Lonczak told the investors at the event. “We have seen some very early positive signs that we can convert fans to customers.”

Drugstore.com’s Facebook fan base for its main sites went from 4,500 in June 2010 to more than 200,000 by the end of 2010, he said.


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