Boohoo’s Q1 results reveal total group revenues of £486.1m, compared to £367.8m in the first quarter of 2020. This is an impressive rebound from the last fiscal year which, on top of COVID-19, saw a series of supply chain scandals and the likes of ASOS, Next and Amazon dropping Boohoo’s Nasty Gal and PrettyLittleThing labels.
Despite the pandemic and noise around supply chain issues, Boohoo strengthened its online business to a remarkable degree. In the 12 months to 28 February 2021, the business had grown its active customers by 28% to 18 million and increased its revenues by 41% to £1.75bn.
The most impactful change and driver of growth is Boohoo’s decision to move beyond just a digital retailer and evolve into a marketplace. The past year has marked a strategic shift for the company as it acquired Debenhams as well as former Arcadia brands, including Burton, Dorothy Perkins and Wallis. Bolstering its roster of labels marks a clear diversification strategy as it is taking other brands to market through its sophisticated sales infrastructure.
However, maintaining growth will take more than just acquiring more brands. What will be more telling is how Boohoo shapes the online journey for consumers. As a digital-first business, Boohoo is not shy when it comes to technological innovation, being one of the first to integrate Klarna. But with recent acquisitions of major labels, it must create engaging experiences for customers, regardless of the brand they are buying from.
As such, there are two key things that Boohoo must consider:
- According to recent Salsify research, almost 90% of consumers will pay more for a brand they trust. This means that Boohoo must invest in providing better brand and product information to boost trust and drive higher value sales. In fact, 45% of consumers reported that high-quality images and detailed product descriptions are one of the top three reasons for trusting a product online so this is a crucial starting point
- Boohoo must invest in compelling digital content that inspires consumers – the key here is personalisation. From videos to an inclusive approach to models and sizing, rich product content can deliver an engaging experience for shoppers and increase the likelihood of impulse buying. With high-quality, relevant imagery and detailed product attributes, it is easier for consumers to understand the quality and origin of the products they are considering. In fact, research by Deloitte reveals that nearly 1 in 3 (32%) consumers are interested in sustainability so highlighting the environmental impact of brands and products is just one of the many ways that Boohoo can maintain a competitive advantage