As fashion goliaths Primark and Asos revealed soaring festive sales today. Retail Week analyses why the two are the sector’s top performers.
It was good news all around in the world of fashion today, with the two heavyweights updating – Primark and Asos – unveiling bumper Christmas sales.
Growth was found mainly in online over Christmas, which predictably some naysayers have used as further evidence that the high street is dying. How such cynics will explain online-free Primark’s “outstanding” Christmas performance will be interesting to hear.
John Bason, the finance director of Primark parent company Associated British Foods, says the retailer is not missing out from its lack of online exposure and says it has no immediate plans to jump into the web.
“You have to look carefully at where online growth is coming from. People still like to look and feel clothes. We believe we can still get substantial growth from our stores business,” he says.
And with 25% growth over the festive period, who would doubt him? Bason was eager to point out that Primark’s growth story is not merely a winter’s tale. “Don’t think it’s a flash in the pan,” he says.
Customers are not just choosing the value fashion giant over Christmas, they are choosing it all year round.
Bason says it is constantly improving its offer which doesn’t just mean its ever on-trend product and unbeatable prices, it also means its store experience.
Shopping at Primark was once like rummaging around a jumble sale, however, as anyone who has been to its new Tottenham Court Road flagship will testify, things have changed.
The retailer has invested heavily in this area and in-store standards are now up with the best. It is also ploughing investment into expanding and revamping stores.
Meanwhile, Asos continues to dumbfound those who say it is reaching maturity in its home market by posting a sales leap of 34%.
“We pulled a rabbit out of the hat,” says Asos chief executive Nick Robertson.
Robertson says the slowing sales growth it experienced at the beginning of last year wasn’t a sign of Asos, or indeed internet shopping, reaching maturity. He candidly admits that it was probably more it taking its “eye of the ball” as it focused on its rapid international growth.
Much like Primark, Asos’ growth has come from giving its customer what it wants. It has sharpened its prices and bolstered its offer, adding new brands to its unparalled offer, including New Look which joined its site last December.
Asos is a brand that is completely in-tune with its audience. It has a clearly defined twenty-something customer who knows completely what she wants.
Meanwhile, Primark has a catch-all strategy and is snatching market share from Marks & Spencer and Zara just as much as young fashion retailers like New Look.
Not all fashion retailers are having as good a time as these two goliaths but their success shows that it doesn’t matter what channel you use, online, the high street or indeed both - the businesses which thrive are those which know what their customers want and deliver it.