After a record first half, Asos’ celebrations have been momentarily paused as the fashion pureplay tackles the impact of coronavirus on customer traffic and sales.

  • Traffic to Asos website has returned to pre-lockdown levels in regions such as Lombardy, Italy
  • Sales up in loungewear, footwear, activewear, make-up and healthcare
  • Denmark, Austria and Sweden have seen sales improvements or staying normal
  • Boss Nick Beighton says shoppers will “demand more from the people they do business with” post-pandemic

Asos operates in around 200 markets worldwide, so the etailer has felt the effects of the pandemic on many fronts. However, that also means it is well placed to understand the patterns of demand in a host of locations and what they may reveal about recovery trends, including in the UK.

Nick Beighton RWLive 2019

Nick Beighton says the coronavirus crisis ‘will be a transformational moment’ for fashion retail

Over the past three weeks, Asos’ group sales declined by between 20% and 25%. But as the stages of the pandemic develop at differing times and speeds in various regions of the world, the retailer can draw conclusions from improvements beginning to show in some countries.

In Italy, where the virus is thought to be two to three weeks ahead in its development than in the UK, chief executive Nick Beighton says Asos saw a pattern of “demand shock” immediately after lockdown, as consumers adjusted to the new realities and evaluated their spending priorities. It is Italy that Beighton looks to as he tries to work out how trading trends will play out elsewhere.

“Because we’re a global business, it’s easy for us to see how official restrictions applied by various governments have affected territories in different ways,” he says.

“When the Lombardy and Milan regions went into lockdown on March 6, we immediately saw a decline in visits, but over the month since we’ve seen visits and sales come back – and visits come back faster than sales.

“We’ve been plotting this pattern for European cities and regions and they all seem to be on the same curve, just at different points along it, depending on the spread of the virus and the specifications of the government regulations.”

As the initial drop in demand subsides, the impact then begins to moderate and online traffic returns, though higher traffic is not mirrored in a similarly high rate of sales improvement.

In the second week after lockdown, Beighton reveals that at a group level site views per week are back up to more than 50 million, which is as good as before the pandemic struck with full force.

While site traffic is improving, Beighton attributes the lack of conversion both to consumers underlying concerns about the current situation and the associated underperformance of certain product categories that are usually in high demand on Asos.

“Clearly going-out gear for women – dresses, high heels, sandals – aren’t performing as well as they usually would right now. In menswear too, tailoring and partywear have been affected,” he explains.

However, Asos has generated an uplift in sales of loungewear, branded footwear, activewear, make-up and healthcare products. It has therefore pivoted the focus of its homepage and social media strategies to reflect this demand.

With an end potentially in sight for Italy’s lockdown, which may be lifted as early as April 13, Asos has yet to see an increase in sales of items such as partywear, but Beighton says that may be because the exact details of the lockdown exit strategy are unclear.

Milan lockdown 2

Italy could start lifting lockdown restrictions as early as next week

He does, however, point to some other European countries where demand for dresses and other forgotten categories is returning, citing sales improvements in Denmark and Austria, which are understood to be close to announcing the end of lockdown restrictions.

He also observes that in Sweden, which has taken a ‘herd immunity’ approach to controlling the pandemic, sales have stayed at a relatively normal level.

In China and Taiwan, although only a small section of the customer base, Asos has also begun to see improvements in data collected over an eight-week period since Wuhan was put into lockdown, and six weeks since all of mainland China was. Beighton reveals that Asos in China is now “in positive year-on-year territory”.

So with the exception of some outliers such as Sweden, the demand curve of initial shock followed by a return in site visits is likely to be replicated elsewhere. Beighton thinks Asos’ experience in Italy will likely prove an accurate template for the European online fashion market more widely.

He also says while it is impossible to predict what will happen in the fashion world post-coronavirus, he believes the outbreak will be a seismic moment in fashion, retail and the world.

“This will be a transformational moment – for people, for consumers, for demand, for how people interact with businesses and how they interact with themselves,” Beighton says.

“I don’t know how that will shape out, but I would anticipate and acceleration of channel shift because people will become more comfortable with it. I think they will demand more from the people they do business with and more from the retailers. That will mean retail is less transactional.

“I also think consumers may see this as a moment to think differently about other issues we need to deal with in the world, how connected we are as humans, economies, nations and businesses, and that might precipitate a wave of thinking that can only be good.”

Analysis: Asos data reveals lockdown sales recovery pattern in Europe