- Plans come as other retailers scale back Black Friday this year
- New customer influx from last year’s Black Friday boosted Very’s growth
- Shop Direct boss Alex Baldock believes mobile growth will not ‘tail off any time soon’
Shop Direct boss Alex Baldock says the retailer has “big plans” for its two-week long Black Friday and denies it is a “vanity exercise”.
The online retail group’s Black Friday activity will last twice as long as last year and comes as other retailers such as Oasis plan to scale back plans for the US-born shopping phenomenon.
Baldock dismisses the notion Black Friday will undo the work the retailer has done in its last financial year around moving away from promotions and towards more full-priced products, a development that is partly credited with its surge in pre-tax profits.
He told Retail Week: “If you are well prepared and spent a long time building strong relationships with suppliers, you can use Black Friday to gain market share profitably.
“It is not some vanity exercise, we are not having a big Black Friday for the sake of it – we are doing it as a commercial exercise.”
Baldock said the new customers last year’s Black Friday brought on board for Shop Direct’s Very brand was a “big contributor” to it growing sales 21% to £850m.
Pre-tax profits up
Very’s growth helped Shop Direct grow total sales 3% to £1.8bn, with full-year pre-tax profits up 78% to £71.7m, driven by investment in big data and personalisation.
In the year ending June 30, Shop Direct dropped the Littlewoods catalogue and the Woolworths, K&Co and Isme brands were shut down.
Baldock would not be drawn on how many customers Littlewoods lost after the catalogue was dropped.
He said: “We have invited them to come over to Shop Direct’s websites and have been very gratified by the take up. We set ourselves ambitious targets and we are ahead of those plans.”
Shop Direct has 4m regular customers and 12m on its databases and Baldock believes there is “plenty of headroom” for growth based on the company estimating there are potentially 20m people in the UK who could shop with the retail group.
Record performance expected
Baldock added the company is off to a “great start this year too and confident we will post another record performance this year” and is relatively insulated from the warm autumn hitting fashion sales because of its diverse product range.
He said: “Coming towards the end of October you don’t really want to see blokes walking around outside in their T-shirts. I think every clothing retailer is looking forward to some winter weather.”
The retailer expects more growth to come from a further investment in mobile, personalisation and big data, in which it is investing £100m over the next three years.
Some 59% of Shop Direct’s sales now come from mobile and Baldock concluded he is “not banking on this tailing off any time soon”.