Dr Martens unveiled a spike in full-year profits after direct-to-consumer sales soared. Retail Week spoke to chief executive Kenny Wilson about how he plans to run ahead of the market.

Against a backdrop of rival retailers Schuh and Office calling in advisers to slash rents – with the latter also considering closing up to half of its 100 stores – Dr Martens’ full-year results make for an uplifting read.

The iconic footwear brand recorded a 70% surge in EBITDA to £85m in the year to March 31, underpinned by a 30% jump in group revenue to £454.4m.

Dr Martens Camden sales floor WEB

Dr Martens has opened more stores in key cities around the world

Direct-to-consumer sales spiked 42% to £199.4m during the 12-month period. Revenues raked in through its store network jumped 30% – and were up 18% on a like-for-like basis – while ecommerce sales rocketed 67% to £72.7m.

Chief executive Kenny Wilson, who joined Dr Martens last year from Cath Kidston, is confident the business has plenty more track left to run.

“We sell in 57 countries and we are a recognised name around the world – we are a big brand but we are still a small business,” he tells Retail Week.

Dr Martens is undoubtedly having a moment, one that Wilson says has been boosted by external factors. He believes increased levels of activism on causes ranging from gender equality to the recent Extinction Rebellion protests in London have fed into its brand positioning, appealing to “authentic characters who stand for something”.

“Our whole proposition is based around rebellious self-expression, so cultural factors are helping us – our brand is a go-to for people who are independent thinkers,” Wilson says.

Increasing investment

But being a brand that chimes with the zeitgeist is not the only catalyst for the business’ exceptional results.

The specialist retailer posted double-digit sales growth across all territories and channels during the year, with its direct-to-consumer division proving the standout performer following a period of concerted investment into stores, online and product.

In the past year alone, Dr Martens has launched a lightweight summer collection, featuring sandals, while its vegan leather range has grown rapidly to account for 4% of group sales.

“We made a decision to increase the amount of direct-to-consumer share in our business, so we are opening stores in key cities around the world, have put significant investment into re-platforming our website, invested in a lot of digital talent and as a consequence what we are seeing is quite exceptional growth,” Wilson explains.

“Our product is excellent, and we are putting a better product range in front of more people around the world. The fact that we are not dependent on a single country helps, but we have a good store base in the UK, which acts as the epicentre of the brand and showcase our product well.”

Today, 44% of Dr Martens’ sales come through its direct-to-consumer channels – a percentage Wilson aims to increase to 50% within two to three years.

To drive that growth, the footwear brand, which operates 109 stores globally, plans to approximately double its bricks-and-mortar footprint over the next five years.

“We are not looking to open any more stores in the UK – the days of needing a large number of stores in any one country are gone”

Kenny Wilson, Dr Martens

The retailer opened 20 new stores during its 2018/19 fiscal year, including four in the US, six in Japan and three in Germany.

Dr Martens plans to maintain that rate of expansion, but Wilson says the two shops it opened in the UK during the year will be its last, despite achieving double-digit growth in the market in its most recent financial year.

“We are not looking to open any more stores in the UK – the days of needing a large number of stores in any one country are gone,” Wilson says.

“We are in the key cities in the UK and have multiple stores in London, so I’m more focused on thinking how we can be represented in key cities in Germany and France, and how we can build on the opportunities in Asia and the US.”

Dr Martens operates 32 stores in the UK and, although Wilson says sales in its domestic market are “extremely strong”, 77% of the company’s sales come from overseas.

The footwear brand has also launched a distribution centre in the Netherlands to supply all of its European markets. The hope is that the new warehouse will shield the business from the disruption that Britain’s impending exit from the EU could cause.

“Clearly [Brexit] brings a lot of uncertainty, so you have to create your own certainty,” says Wilson. “We’ve sensibly Brexit-proofed ourselves in the event that things are tough at the ports.”

In a sluggish footwear market, Dr Martens has marched ahead of the competition, buoyed by investments in a compelling direct-to-consumer experience.