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Brand Alley seeks funding for European spread

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French-owned Brand Alley grew UK sales 101% to £18.1m in the year to December 31, 2010, with the number of UK active members up 26.2% to 1.4m. The private sales fashion etailer says it is on target to attract 500,000 new members here by the end of this year, and plans to expand into more European countries if funding is found. Total revenues increased by 64% to £86.9m in 2010, compared to £53m in 2009. Due to investment in growth BrandAlley was not profitable this year but will be next year, the company confirmed.

Merrill Lynch & Co has been appointed to help Brand Alley raise £87m (€100m) for growth via acquisitions, Sven Lung, founder and chairman of the Brand Alley Group, told the Sunday Times. Brand Alley has been a pioneer in the members’ only e-commerce world and is thought to be in a good position to launch in new European countries, and expand into new product categories. With over 1,250 brands sold across the group, the site offers high quality designer fashion, homewares, and beauty at an affordable price. It recently launched a major marketing campaign in the UK under the strapline “the possibilities are endless”, highlighting the breadth of offers available to members.

The fashion etailer also plans to launch an online catalogue of permanent products in key areas such as jeans and lingerie, instead of offering limited availability through 4-day flash sales. UK customers will be able to take their time to choose and buy from the e-catalogue in a more conventional way. BrandAlley will also use social media to advertise special offers as it diversifies into travel and lifestyle brands.

In 2010, BrandAlley entered the m-commerce space and with the launch of its pioneering iPhone application which allows members to make purchases through their mobile phone. There are 370,000 members who have already downloaded the iPhone app across the UK and France and 10% of group revenue now comes through m-commerce.

In the three months to 31 March 2011, group sales grew by 61% year-on-year demonstrating the huge potential of the private sales model. Commenting on the results, Lung said: “The Group achieved a phenomenal period of growth last year in the UK and France despite the wider retail slump. BrandAlley intends to build on this growth which will come through continued member loyalty, new products and further expansion across Europe.”

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