Next is one of the UK’s largest fashion and home retailers, with annual sales passing the £5bn mark in the year to end January 2023 (FY2022) and an eviable ecosystem. Its well-established omnichannel model allows it to react with agility to changing customer demands, while bold investment in both its stores and online operations is paying off as it caters to consumers’ increasingly channel-agnostic shopping habits.
Group sales rose 8.8% to £5,034m on a statutory basis in in FY2022, which was equivalent to an increase of 18.0% on a three-year basis. Store sales have recovered to pre-pandemic levels, while online sales – although edging down year-on-year – were 40% ahead of FY2020.
Store sales had been on a long-established downward trend ahead of the pandemic and Next has been investing in the infrastructure required to get back in front in ecommerce in an increasingly competitive online fashion marketplace. Investment in warehousing and systems has been further accelerated from 2020 in response to the changing shopping behaviour.
As pandemic-related restrictions have lifted, consumer spend has shifted back to the high street and customers have returned to stores, with Next’s investment in new formats such as its Beauty Hall concept and department store style shops that bring together fashion, home and beauty paying off.
Next’s omnichannel model allows it to react with agility to changing customer demands. This multichannel focus has seen its continue to maximise the online value of its stores through increased integration, improving user experience across channels, investing in targeted marketing and personalisation.
Keen to create new business opportunities, Next is also developing its ability to service third-party brands through the launch of Total Platform, which offers an array of online services to third-party brands. It has also been maximising on the opportunity provided by Total Platform for strategic stake building in partner brands and within the past few months has acquired the Made.com, Joules and Cath Kidston brands out of administration.
Next’s key areas of business development include growing the brand overseas, ”developing new product ranges outside of the Next brand through wholly owned brands and licences”, and developing Total Platform, which includes related investments.
Innovation rating: 3.5