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Move towards mobile commerce underlined in Shop Direct figures

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The fast growth of mobile commerce has been amply illustrated in Shop Direct’s Christmas trading figures, out this week and hailed by its chief executive as “another milestone on our journey to being a world-class digital retailer”.

By 2015, said Alex Baldock, the group expects every transaction to involve a mobile device.

The company, which trades brands including Very.co.uk, isme.com and Littlewoods.com online and through call centres, is already a highly digital brand – some 84% of its sales took place online this Christmas, 14% up on the same time last year. Perhaps fittingly, Cyber Monday, December 2, was the busiest day of a period in which 56m visits were paid to Shop Direct websites, 32% up on the same time last year.

This year, its customers showed mobile devices were fast becoming their shopping tool of choice. Shop Direct reported 64% growth in its mobile sales, which accounted for 43% of all its online sales. That’s up from 28% at the same time last year. For the first time, more than half (52%) of website traffic was from mobile devices.

“Mobile exploded as a source of both traffic and sales,” said Baldock. “More than half of all visits to our websites came from smartphones and tablets this Christmas. By 2015 we expect every transaction to involve a mobile device at some point in the customer journey. It’s hard to overstate how important this trend is, and we mean to stay on top of it.”

Total group sales in the six weeks to December 27 rose by 5% on last year. In the 26 weeks to the end of 2013 they were up by 1%. But the group made much of the performance of Very.co.uk and isme, com, hailed as “the future growth drivers of the business”, which saw combined retail sales rise by 27%, thanks to a product mix that this year included Adidas, Apple, UGG and Samsung and Superdry. Combined sales at Littlewoods.com and KandCo.com fell by 5%.

Baldock also pointed to the discounting that has characterised Christmas 2013 trade. “The retail market has been highly promotional,” he said. “We’ve responded selectively, but we’ve kept our discipline in stock and cost control and are ahead of our EBITDA (earnings before interest, tax and depreciation of assets) and profit targets.

“Looking forward, we will continue to invest to build a world class digital retailer. Our outlook for the rest of 2013-14 does remain cautious though: we’re not banking on this market being any less challenging.”

Shop Direct Group’s Chris Haighton, head of retail logistics, and James Harper, head of returns, will be speaking in the Operations and Logistics Conference at IRX 2014. Click here to see details of their presentation or here for more information on IRX and to register to attend for free.

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