Despite the hit to sales suffered by fashion retailers amid the coronavirus pandemic, Superdry chief executive Julian Dunkerton is positive that, barring absolute disaster, the retailer’s design overhaul and new strategy will set it up for long-term success.

  • Dunkerton says “there are three main focuses” to get back on track: product, social and sustainability

  • Superdry has hired former Boohoo international director Justin Lodge with the aim of increasing influencer marketing

  • Online sales have almost doubled year on year and the retailer now has 70% more options now online

For Dunkerton, the founder who returned to the helm of Superdry in October last year, and immediately set about a “reset”, the Covid-19 outbreak has made his task even harder.

But together with creative director Phil Dickinson, Dunkerton has overseen a new autumn/winter 2020 range as he seeks to return Superdry to a product-led strategy – and that, he insists, will ultimately see the business right.

Superdry bore an underlying loss before tax of £42m last year, and Dunkerton has attributed much of the slide in sales and profits to the impacts of the pandemic on consumer shopping habits. His confidence in the fundamental appeal of the brand is undimmed. 

‘‘Superdry’s woes were amplified in its final quarter, with the impact of the Covid-19 pandemic stifling the appetite for new clothing and footwear,” says GlobalData analyst Chloe Collins.

”While [Dunkerton] has had significant plans to revitalise the company, the outbreak has put a major spanner in the works.”

“Now we’re in a position that the product is improving on a constant basis, you will see better quality, exciting designs and a much more sophisticated product range”

Julian Dunkerton, Superdry

In the five weeks to May 30, during the height of the pandemic, sales plunged by 36.9%. While there was some improvement in June and July, with sales down around 19% in both months, the retailer had to revert to heavier discounting of surplus stock, going against the full-price stance Dunkerton was attempting to move into.

The first quarter of Superdry’s new financial year has also brought “disrupted trading”. Sales for the seven weeks to September 12 were down 30.3%, while online sales growth has “normalised” at 4% since August. 

In pure business terms, Dunkerton now says “there are three main focuses” to set a more positive direction.

“Now we’re in a position that the product has improved, and is improving on a constant basis from now on, you will see better quality, exciting designs and a much more sophisticated product range. It’s also about social and sustainability.”

Superdry has undertaken a host of initiatives in a bid to “be the number one sustainable listed company in the world” in the fashion industry. 

A key goal is to use 100% organic cotton in Superdry products by 2030. The retailer made headway last year and 19% of its products are now made from organic cotton. To aid the acceleration of the target goal, Superdry is training 2,000 farmers in India to convert to organic.

In addition, 92% of Superdry’s packaging no longer contains single-use plastics, and all its offices and stores now run on 100% renewable energy. 

Superdry also intends to step up its social media game. It has hired former Boohoo international director Justin Lodge as chief marketing officer, with the aim of increasing influencer marketing.

“Justin will address our online influencer model and how we become best in class,” Dunkerton says.

“I think a lot of people talk about social, but very few people understand what the likes of Gymshark and Boohoo have actually done. For us to bring in someone like Justin is a real statement of intent.” 

Dunkerton cites a campaign with Harry Potter actor Hero Fiennes-Tiffin, which went live last week. Singer Zara Larsson has also just signed up as a face for Superdry. Both are indicative of the retailer’s move into a young and dynamic influencer space.

“With its prices appearing expensive in comparison to its competitors, it must better justify the quality and longevity of its styles and invest in celebrity endorsements’’

Chloe Collins, GlobalData

Dunkerton has identified these key priorities to provide a better and more personalised offer to its customers, hoping to support its return to full-price sales, rather than relying on discounting.

GlobalData’s Collins says: ”Superdry is facing tough competition from fast fashion players such as Boohoo and Asos. With its prices appearing expensive in comparison, it must better justify the quality and longevity of its styles through social media, and invest in celebrity endorsements to boost desirability.’’

Highlighting its sustainable credentials could also work in Superdry’s favour. There is some evidence that consumers began paying more attention to the environment and their consumption habits during the pandemic – something that can help Superdry differentiate its offer from the competition.

To match the new product ranges, Dunkerton has also led a revamp of Superdry’s stores to help improve the customer journey.

“Particularly in our larger stores, historically you’ll have walked in and it would have been a bit overwhelming – the whole journey would have been overwhelming and you would have been thinking, ’Where do I go? How do I navigate the store?’” he explains.

“What this is doing is making it easier to navigate. We’re splitting it into what we’re calling style choices, making it much easier to shop with defined zones in a store.”

Superdry has identified nine types of consumer with four different style types overlaid: casual and vintage; sophisticated and minimal; sport; and streetwear and energy.

By reorganising the store based on style, rather than gender or product category, the retailer hopes to be able to communicate with customers on a personal level.

Dunkerton has already noticed an improvement in responses from female shoppers – seven out of 10 of its bestselling products last week were from its women’s categories.

Typically, the retailer’s menswear has been dominant, but as of May this year womenswear accounted for almost half of Superdry’s sales, a pattern Dunkerton believes will continue as the retailer drives engagement on social media.

“We all know that women embrace newness quicker than men, so it’s great that our products are being embraced by women,” says Dunkerton.

“The good news is that, if stores become more difficult, then online will grow” 

Julian Dunkerton, Superdry

He summarises the changes with an analogy using the retailer’s new vegan trainer range – a product that he is most excited about.

“Focus on our vegan trainers – they look amazing, they have a real retro look and feel, they’ve just launched in retail, but what do they say?” he concludes.

“They’re vegan, so that’s a move towards a sustainable future, they’re £65 and £75 so they’re very affordable, and they look amazing. 

“That tells you everything you need to know about Superdry’s future – product, sustainability and accessibility.”

New product is clearly king in Dunkerton’s mind and, even with a second wave of coronavirus on the cards, he seems happy that Superdry has done “everything we need to do internally to be a better business”.

“The good news is that, if stores become more difficult, then online will grow,” he adds. 

The retailer’s online performance benefited from the channel shift while stores were closed – aided by its ”abundance of hoodies and joggers” Collins points out in a nod to the most popular lockdown fashion products. 

In the first quarter, even with stores reopening, online sales have almost doubled year on year and there are 70% more options now online.

Superdry is also embarking on a mission to differentiate its online and offline offerings further by adding limited-edition drops to its website, releasing online exclusives and driving excitement using its social channels.

With the new range fully released by the end of October, there will be even more riding on its success as uncertainty over the direction of the pandemic and its effect on Christmas trading are still to play out.