Blog: Leonie BarrieA discount destination

Leonie Barrie | 19 June 2008

Asos is one of the UK’s biggest retail success stories of recent years, so when it reveals plans to launch an online discount operation in September the rest of the industry sits up and takes note.
Under the brand Asos Red, the e-tailer will sell end-of-line or clearance brand names at a discount of up to 75%, and hopes to take a slice of the market away from rivals such as TK Maxx and even eBay.

Asos CEO Nick Robertson told just-style the concept is an extension of its existing clearance section, and has been prompted by rising demand from its customers for an online bargain.

The move is undoubtedly well timed, with the current economic climate meaning that consumers are keen to seek out discounts wherever they can find them, particularly when those discounts include quality brands like Ted Baker and Diesel which are already stocked by Asos alongside its own lines.

And there is currently more space in the value clothing market after the well-publicised problems at MKOne, Ethel Austin, and Internacionale earlier this year.

Interestingly, TJX, which operates the TK Maxx stores in the UK, doesn’t sell products on its website, using this merely as a vehicle to direct consumers to its shops. But Asos has the expertise in online retail – and of course no shops to detract from its core business.

One of the joys of the internet is that many sites have permanent sale sections where you can snap up a bargain without waiting for retail stores to stage their seasonal markdowns.

But perhaps one of the few disadvantages of the Asos plan, particularly if the retailer manages to create a site that is the definitive discount destination, is that consumers might simply wait to buy the cut-price products instead of items at full-price from its new ranges.

UK: Asos to launch discount arm Asos Red


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