Asos shifts focus to key global markets
Nick Beighton, who was promoted from CFO to CEO in September, said Asos would focus far more on the UK, which is still its biggest market, Europe, US and China under his leadership.
“In Australia we have a great business and enjoy the leading market share,” he said while presenting the company’s full year results.
“We will continue to improve that experience for our customers but it won’t be attracting the same level of investment as the other territories I’ve referred to.”
Asos posted a £47.5 million pretax profit for the year to August 31 with sales up 17 per cent to £1.12 billion. UK sales rose 27 per cent while international sales were up 11 per cent.
When asked about proposed changes to apply GST to all goods purchased overseas, Asos CFO, Helen Ashton, said they were confident costs would be covered if need be.
“We are mindful that it may hit us in 2017. How large a proportion of our sales Australia will be by that point in time I’m not convinced,” she said.
Beighton added, “Some people think Australia is over 10 per cent of our sales mix. It’s not. Certainly, by 2017 it will be substantially less than it is now.”
He said Asos will have two options, to pass on the cost or absorb it and offset it elsewhere in the business. “But until it becomes actually firm there’s no point speculating what we would actually do,” he said.
Beighton said the online retailer’s mission to be the number one fashion destination for twenty-somethings, remains the same. The new CEO won’t be changing the Asos culture or the way the business does things, but he acknowledged the world Asos plays in is changing fast.
“It’s more about mobile, it’s more about social, it’s more about content,” he said.
The online retailer’s strategy is made up of four key pillars: great fashion at a great price, be awesome on mobile and, deliver engaging content and experience, supported by best in class service (ie. a friction-free experience from logistics through to customer care).
“This really has been another year of mobile,” Beighton said.
“In the last 12 months mobile penetration has increased throughout our business. In August 60 per cent of our global traffic came from mobile devices alone.” He added, just in the UK in August, 50 per cent of orders – not traffic – came from mobile devices.
Another key market for the brand is China which was described as “still in start up mode” and “all about planting the seeds for future growth.” Asos expects losses of £5 to £7 million over the next 12 months in China as it builds its offering.
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