Last November, Boohoo won the highly contested Fashion Pure-Play Etailer of the Year category at the Drapers Awards. The judges were impressed by its “incredible confidence”, and said it really had its foot on the gas.
Proving them right, Boohoo has accelerated its acquisition strategy since then, snapping up 66% of PrettyLittleThing for £3.3m in December last year and confirming this week that it will acquire the assets of US retailer Nasty Gal by 28 February.
Boohoo is constantly evolving its offer to attract new customers. In 2015 it launched a range of women’s sportswear – Boohoo Fit – and a petite collection, followed by a dedicated menswear website, and kidswear and maternity ranges last year.
It has marketing at the heart of its strategy from day one. Notably, it has created a strong campaign offline with its TV and billboard campaigns, which led the way for rivals such as Asos and Net-a-Porter.
There have, of course, been challenges: the fast fashion market is a competitive space, and last week’s Channel 4 Dispatches documentary on the working conditions in the warehouses of some UK retailers cast a cloud over Boohoo and some of its peers.
Yet Boohoo founders Carol Kane and Mahmud Kamani have become a force to be reckoned with. When I interviewed them back in May 2015, it struck me how different from each other they were, but how their unique mix of personalities and skillsets drives the business forward.
Understanding the target customer … will be key to their success
Now, with the acquisition of Nasty Gal going ahead, the big challenge will be to crack the notoriously difficult US market. Boohoo has been intent on this since it opened a New York pop-up store in 2014. The acquisition of Nasty Gal’s customer database will certainly help, as will the strength of Boohoo’s brand.
In other acquisition news this week, Phase Eight and Whistles owner The Foschini Group (TFG) has bought womenswear brand Damsel in a Dress. The mid-market brand has a similar handwriting to Phase Eight, as well as a comparable price point. Whistles has a more fashion-led offer, but the three brands are complementary.
For both Boohoo and TFG, understanding the target customer of the new brands in their portfolios will be key to their success.
Meanwhile, TFG’s focus on acquisitions in the UK fashion market is a reasssuring sign that international retailers see opportunities here, despite the Brexit vote. For an update on the industry’s lobbying efforts, click here.