As etailer Asos reports a 30% increase in sales in its first quarter, Nick Robertson talks about what we can expect from the retailer over the coming year.
Q: Congratulations – you topped Drapers’ Power List this year. How do you feel about that?
A: It’s great. I am deeply honoured to have topped the list.
Q: This is another good set of results for you and you mentioned that you were particularly pleased with the performance in the UK. Why do you think that was?
A: We are very pleased about the UK but I don’t think there is one silver bullet that has led to that result. It is down to a combination of things including price activity - we have lowered prices on our own brand, we have focused back in on our 20-something customer, our marketing activity has improved, we have been more mobile savvy and we have offered improved delivery options. All of these things together have combined to mean it has been a much better quarter for the UK business.
Q: You mentioned you have lowered the price of your own brand product. Have you taken a hit on this?
A: We have lowered the prices and we are not buying the product any cheaper so yes, that has had an impact on our margins. Hopefully we will be able to recoup that at some point by working out new deals with suppliers.
Q: How much have you reduced your prices by on your own label product?
A: On womenswear, which accounts for 75% of our total sales, we reduced prices by an average of 9% and we began doing that in the second week of March this year. On our own label menswear we reduced the selling price by an average of 5%.
Q: You said that in Europe it was the countries with their own local language sites (France, Germany, Italy and Spain) where you performed best. What does the break down look like?
A: Europe looks like the worst number in terms of sales growth [15%] but in the countries where we have our own local language sites we are outperforming that by about three times. It is in the other countries like Scandanavia where we don’t have local sites where we aren’t doing so well.
Q: With that in mind, do you have plans to launch local language sites in other regions in Europe?
A: No, not at all. For us it is all about focusing on the big ones, which are China and Russia.
Q: When do you expect those sites will launch?
A: You can expect those sites to land before October next year.
Q: There have been several high profile exits from Asos recently, particularly on the buying side. Can you tell me why you think this is?
A: Asos is now 13 years old and some of the people you are referring to had been with the business for 10 years and nothing lasts forever. Things tend to happen in cycles. We have a huge talent pool coming through the ranks and we are employing lots of new people as well and we have got lots of fantastic people joining. I know the press has been quick to jump all over the fact that Kate [Bostock] is joining and that’s why everyone is leaving but that’s just simply not true. Kate doesn’t even start until January so it has nothing to do with it.
Q: Kate starts in her new role as executive director of product and trading in January. What can we expect from her once she starts?
A: She will bring a maturity in to our retail teams which we have had never had before and a level of rigour and process to areas where perhaps we didn’t have rigour and process before. We are really looking forward to her coming on board.