Asos a runaway success

By: Leonie Barrie - 20 January 2009 14:31

If both young fashion and the internet are two of the more resilient retail sectors at the moment, then it’s probably no surprise that Asos managed to rack up a whopping 118% year-on-year rise in sales for the nine weeks to 16 January.

As older consumers cut back on their spending amid worries about falling house prices, redundancies and fears of recession, younger shoppers – Asos targets 16-34-year-olds – seem more concerned about emulating the fashions worn by pop stars and celebrities.

Asos started out selling celebrity-inspired items As Seen On Screen, although it has now branched out to include branded lines as well and claims to be the UK’s largest online fashion and beauty store with more than 1m visitors a week.

And analysts see further opportunities for growth as consumers become more discount focused, more brands sell their products on the site instead of developing their own online presence, and international sales continue to soar.

If there are concerns about its trading, they focus on the fact that product promotions and a number of free delivery weekends in the run-up to Christmas had impacted margins. And that the firm didn’t provide an upgrade for the current year other than to say it expects full-year profit to be in line with expectations.

But if this is as bad as it gets, then surely in the current economic climate Asos must rate as one of the industry’s runaway success stories.

UK: Online retailer Asos doubles Christmas sales