dolution

Case study

Asos

Asos is a pureplay retailer launched in 2000, that offers more than 50,000 branded and own-label product lines across womenswear, accessories, beauty, jewellery, footwear and menswear. With over 6 million active customers it is the UK’s largest independent fashion and beauty retailer. The company is aimed at fashionforward 16–34-year-olds and is seen as a trend setter by this age group.
UK sales have benefited from refocusing on its domestic market with improved delivery, reduced prices and increasing digital marketing. After years of consistently high sales growth, 2012 saw a slowdown. Subsequently the introduction of low-cost Primark merchandise proved to be a particularly successful initiative.
The company has seen considerable success in selected international markets; spreading its fashion forward offer internationally and through new channels. Having launched a US website, followed by French and German language websites in 2010, Asos launched dedicated sites in Australia, Italy and Spain. These were supported by concerted marketing investment in each country. Overall, the company distributes to more than 190 other countries from its central distribution centre in the UK, though the retailer has stated that its longterm goal is to tailor ranges to local customers and reduce the cost of delivery and returns by developing warehousing facilities abroad.
Asos attributes its continued international growth to its innovative approach, focusing on offering its customers new styles and reacting quickly to fashion trends. Offers such as free next-day delivery have also had a strong appeal. However, their international management structure, with local management teams in the USA, France, Germany and Australia also contribute to strong sales growth.
In 2011 Asos rationalised its distribution and order fulfilment processes into a 49,000 square metre facility at Barnsley in the north of England. This new site is operated by a third party company, Unipart Logistics, and will replace the retailer’s four distribution centres in Hemel Hempstead, near London. The total cost of the move, including the site acquisition and transfer costs, was estimated to be in £19m, which impacted on operating profits in 2011, which were reduced to £16m, but which recovered to £32m the following year.
Incommon with many other online retailers the company offers a click-and-collect service, through Collect+ a network of 4500 stores that offer long opening hours, convenient, neighbourhood locations and secure storage facilities.
Asos Fashion Finder was launched in March 2011 which is an interactive forum that presents customers with latest fashion trends, product recommendations and the ability to upload outfits and items they like. When showing customers where to buy products from, Fashion Finder does not necessarily direct them to goods sold by Asos, helping the service to establish trust and credibility. The aim is to drive site traffic and build Asos’ credentials as a fashion destination (as opposed to a retail destination).
While its advertising expenditure decreased in 2012 the company has been active in developing its online media links. Asos ‘on the go’ provides apps for mobile connectivity for search and order functions as style guidance. But the company also works with other sites, launching Europe’s first fashion transactional Facebook site which stocks Asos’s entire range and allows customers to purchase, leave comments, ‘like’ products, and link their opinions on Asos items to their Facebook profiles. The retailer anticipates that easy access to its ranges will result in improved levels of sales conversion. Conventionally it has sites on Twitter and You Tube, but more recently it created a digital campaign with Pinterest.
Offline, the company has entered into collaborative promotions to extend its exposure to its target market. These have included an interactive campaign with toiletries market-leader Nivea and Pernod Ricard to promote its Malibu and Jacob’s Creek brands and offer fashion advice in pop-up bars in four major UK cities.
1. How does Asks differentiate itself as an online retailer?

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2 .What are the key issues facing the internationalization of fashion retailers?

3 .To what extent does Asks have the capability to become a multichannel retailer?

 
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