Sales at the online fashion retailer Boohoo doubled at Christmas as young women flocked to the website for party outfits and gifts.
The Manchester-based company, which also owns the PrettyLittleThing [PLT] and Nasty Gal online brands, is winning sales from traditional high street retailers as it cashes in on a generation that shops via their mobile phones and takes style cues from social media.
Boohoo said group sales surged 100% year-on-year to £228.2m in the four months to 31 December, thanks to stellar sales during the Black Friday promotional bonanza in November.
Sales at PLT, where hundreds of new products are added to the website every day to satisfy its fashion hungry shoppers, were up 191% on the previous year.
Boohoo’s USP is inexpensive clothing aimed at fashion-conscious women, with its figure-hugging Lycra dresses starting at £10 while thigh-high boots cost £30. Its sharp pricing is giving high street rivals such as Primark a run for their money as it targets young shoppers with limited finances.
The standout performance by Boohoo comes as Britons’ finances are squeezed by slow wage growth and higher inflation, a predicament that forced them to cut back on buying almost everything other than food in the run-up to Christmas.
Retailers with strong digital operations are proving to be more insulated from the downturn in consumer demand than those with large store networks to run. Earlier this week, fashion company Ted Baker also reported higher sales over Christmas thanks to a surge in online purchases.
Boohoo was set up in 2006 by Mahmud Kamani and his business partner, Carol Kane, who previously supplied high street rivals such as Primark and New Look. The duo share the role of chief executive.
Its shares have soared in value since listing on the stock exchange in 2014. When it joined the stock exchange, the company’s shares were worth 50p but are now worth nearly four times that.
Charlotte Pearce, a retail analyst at GlobalData, said Boohoo’s brands were luring dissatisfied shoppers away from the likes of New Look, Miss Selfridge and H&M.
“The group stands out compared to online rivals such as Missguided and Quiz thanks to its innate understanding of its core shopper base, its low-priced on-trend product and its well-targeted marketing and social media.”
Pearce said Boohoo had relied on a campaign of heavy discounting to win customers by offering Black Friday discounts of between 30% and 60%. “While its relentless discounting activity needs attention, boohoo.com’s product and brand presence is clearly winning over 16-24 year old shoppers.”
In a joint statement, Kamani and Kane said: “We are delighted to report another set of strong financial and operational results, with record sales in the four months to December across all our brands.
“The Black Friday period was our most successful ever. PrettyLittleThing has continued to deliver exceptional results and Nasty Gal is making excellent progress in its first year.
“Our focus remains on the customer proposition: offering the best range of the latest fashion at affordable prices, coupled with great customer service.”
