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Majestic Wine set to build on multichannel advantage

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Majestic Wine today said it would continue to develop its multichannel advantage in the face of growing online competition, developing its online channel in tandem with store numbers.

The update came as the wine merchant reported online sales up by 5.8% to £27.7m in its latest financial year. Ecommerce now accounts for 11.4% of the wine merchant’s retail sales, up from 11.1% at the same time last year.But, said Majestic, the rate of online growth had slowed as more retailers entered the market.

During the year to March 31, Majestic processed 245,000 online orders, 4.9% more than the year before, while the average transaction value rose to £135 from £134.

Recent ecommerce investment has included a new website launched in July 2013, which, said the company, brings improved functionality aimed at giving customers greater choice. Meanwhile Majestic is now developing a new multichannel CRM strategy to make its customer communications via both email and mobile more personalised.

As well as spending on ecommerce, Majestic is also expanding its store numbers, and aims to grow to 330 stores from the 206 it currently has. In its latest year it opened 13 new stores. The company said in its statement today: “We have a clear competitive advantage as an online channel as we have both the brand and a national store network, which enables us to simplify and enhance our proposition to customers who shop across channels.”

In the year to March 31, total sales reached £278.2m, up by 1.4% compared to the same time last year, but like-for-like sales in UK retail stores were down by 0.1%. Pre-tax profits rose to £23.8m from £23.7m last time.

Steve Lewis, chief executive, said: “Majestic made good operational progress in the last year and despite the difficult trading environment delivered a solid performance. 2015 will be a year of increased investment for Majestic to ensure we have the right infrastructure to maximise on our long-term opportunities for future growth.”

The average spend per transaction rose by £1 to £129m, with the average bottle of still wine now costing £7.94. Some 643,000 active customers bought from Majestic during the year, 2.9% up on last year.

Majestic’s strategic aims also include increasing sales to businesses and of fine wines.

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