It is safe to say that Laura Ashley has not had a good year in fashion.
Its spring 17 collection, which featured floral prints and crocheted accessories, failed to make an impression on its target demographic – female shoppers aged over 40 – and like-for-like sales slid 10.4% for the year to 30 June.
Pre-tax profit for the 52-week period plunged 72% from £22.8m to £6.3m, although the company’s previous reporting period ran over 74 weeks.
Although fashion accounts for just 15% of the business, Laura Ashley is clearly aware that it is a top priority. It recorded the steepest sales decline among its four product categories – rounded off by home accessories, furniture and decorating.
Following its set of disappointing results, Laura Ashley has outlined plans to get the business back on track with a newly restructured fashion team, including the appointment of a new head of fashion, and an ongoing review of its supplier arrangements.
Chief financial officer and joint chief operating officer Sean Anglim told Drapers the business “didn’t have a great spring”, and that it will now focus on creating “product that is more appropriate for its target customer in terms of style and fabrics”.
It certainly makes sense for the company to now focus on sharpening its targeted approach by improving product style and quality across the board, as its core customers continue to seek value for their purchases.
However, questions remain over whether Laura Ashley will pay more attention to differentiating its product offering. It staunchly avoids a trend-driven outlook, but as older customers turn more towards more fashion-driven styles, perhaps the retailer should consider taking more of a risk.
Tamara Sender, senior fashion analyst at research firm Mintel, said: “Based on what we’ve seen, Laura Ashley always relies on its status as an iconic British brand, and assumes people will buy its product for its patterns, but that isn’t what drives shopping habits any more.
“At the same time, many other players in the market are targeting similar customers with more success, such as John Lewis. These are working hard to understand the increasingly stylish customer and how their lifestyles have changed.”
The Drapers Verdict
As the competition heats up, Laura Ashley must think of fresh ways to stand out from the crowd and engage with its changing customer, or risk further decline.
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