SuperGroup [IRDX RSGR], owner of the Superdry brand, today reported revenues of £752m in the year to April 29. That’s 27.5% up on the same time last year. Retail sales rose by 12.7% on a like-for-like basis, which strips out store openings and closures, and were fuelled, said SuperGroup, by ecommerce growth of about 35% during the year. Pre-tax profits of £84.8m were 53.1% up on last time.
Chief executive Euan Sutherland said the retailer had maintained momentum against all elements of its strategy. “Our focus on delivering long-term sustainable growth continues, through a multichannel approach that balances a disciplined owned and franchised store opening programme with further development of our reengineered wholesale channel and strong commerce proposition,” he said.
He added: “The group is globally diversified and financially strong and we remain confident in our strategy to further embed Superdry’s position as a global lifestyle brand. Investment in infrastructure is underpinning our global growth plans and creating future leverage opportunities while ongoing product innovation and new social and digital marketing campaigns are introducing new customers to the Superdry brand.”
We took a look to see in more detail what the fashion brand, a Top100 retailer in IRUK Top500 research, had to say about its multichannel strategy.
Multichannel approaches through stores…
Superdry sells through 863 stores and concessions in 62 countries. Its 27 international websites sell in 12 languages in 18 countries. The retailer said today that it had expanded during the year in all of its key retail, ecommerce and wholesale channels. It said the brand had proved resilient following the Brexit vote and subsequent fluctuations in exchange rates.
“We are committed to providing a compelling multichannel experience for our customers and firmly believe that the brand’s potential will be optimised through a combination of shopping channels, including stores,” Supergroup said in its full-year statement. It says that its in-house research has shown that multichannel customers are more valuable than single channels ones, “as they spend more often and have greater brand loyalty”.
Two trial stores, in Manchester’s Arndale centre and White City in London, tested new concepts are testing new concepts around technology and extending the range, with a view to increasing sales density while reducing capital and operating costs. It found that like-for-like sales rose by 20% and 10% respectively. The new store format will now be introduced via a refurbishment programme, with 10 UK stores expected to see a makeover in 2018, and into all new stores.
Online sales rose by about 35%, year-on-year, and accounted for up to 25.9% of total retail sales.
“This growth,” said the retailer in its full-year statement, “reflects the benefit of small incremental improvements to the customer online experience.” Those improvements include the use of image-based search on search engines such as Google; use of social media to increase awareness and to keep customers engaged, including the introduction of #mysuperdry to the brand website.
During the year some 14% of online sales took place on third-party websites including Zalando, La Redoute and The Iconic.
Supergroup says that customers primarily visit its 27 websites via mobile devices: 67% of visits came from a mobile or tablet during the full year, and visits from mobile rose by 34%, year-on-year.
Operations and logistics
Priority areas for investment are to set up multichannel distribution centres close to key markets, which Supergroup believes will mean “better service and accelerated fulfilment at a lower cost.” The new centres will feature a single stock pool, while warehouse automation will also be introduced “progressively” in order to improve efficiency and service. During the latest financial year, single channel distribution centres were opened in Belgium and the US: operations in both will be expanded to serve the market on a multichannel basis, with US wholesale logistics, currently outsourced, set to be brought into the group network. The Belgian site will have a new order management system integrated into operations that will enable regional fulfilment for Continental Europe from that site.
Supergroup is focusing on developing the North American and Chinese markets during the year, with trial stores currently testing different formats in both territories. In China, the company said, “customer tastes are evolving from luxury brands to brand influenced by ‘pop’ culture, and we believe that the Superdry brand, with the right product, pricing and infrastructure is well positioned to be successful. It is working in a 10-year joint venture in the market with Trendy International Group.
It is also focused its owned store expansion programme on Continental Europe.