ASOS's Price Cut Strategy Has Handed Out A "High Score" Report Card.

We have done this before, Britain. fashion Online retailers ASOS It is expected that after the British "off Europe", the opportunity of sterling will go down, and the share of overseas market will be acquired through the strategy of reducing prices, so as to achieve further growth of performance. Now, the price reduction strategy really worked.

According to the world clothing and shoe net, in July 13th, ASOS announced its new quarter financial report as of June 30, 2017. The report shows that brand During the financial period, revenues increased by 32% to 676 million pounds over the same period last year. The growth rate was 26% at a constant exchange rate.

The hero who contributed to this growth was the overseas market which was stimulated by this price reduction strategy and achieved strong performance. The market created a total of 425 million euros in revenue during the financial period. The European and US markets were the most eye-catching. The former increased revenue by 54 percentage points during the financial period, while the US market performed slightly worse, but it also achieved an increase of 41%.

"The financial performance in the first half of the fiscal year continued in the third quarter, mainly because we are still increasing investment in brand image and investment in price management." ASOS CEO Nick Beighton commented in the relevant media statement.

In addition to price cuts, ASOS announced the use of stretch mark models for a long time ago, and also sucked a wave of powder for them. Efforts to create "three positive" image, more or less, will allow brands to get more opportunities in the market, especially in Europe and the United States that are fully concerned about "politically correct".

At least from now on, everything is proceeding according to ASOS's expectation. After announcing the performance of the financial period, ASOS announced that it expects to maintain its revenue growth forecast for the whole year - half yearly reporting time, which has raised the expected revenue growth rate of 25%-30% in fiscal year 2017 to 30%-35%. Profits continue to maintain expectations at the beginning of the fiscal year. According to the plan, ASOS can create a profit of 79 million 400 thousand at the end of the fiscal year.

However, the value note is that in the last quarter, ASOS failed to create a satisfactory result in its domestic market. Its revenue in the UK only increased by 16 percentage points, which was lower than analysts' expectations.

"In the overall downturn of the UK brand, this performance is strong enough," although Richard Chamberlain, an analyst at Royal Bank of Canada, has expressed its concern, despite the performance of the European and American markets. "But this may be taken as a signal that the long-term growth potential of the company may have a negative trend."

From the new strategic plan announced by ASOS, the company is indeed looking for and developing new growth points. According to the earnings report, ASOS is positioning itself as a mobile provider. At present, mobile phone sales account for 58% of its total revenue, and this figure will continue to rise in the future.

At the same time, in order to further enhance the competitiveness of its online brand under the full channel strategy, ASOS has also increased the construction of warehousing and logistics facilities. At present, its second European warehouses have entered a smooth running state, and the new logistics center of the United States is also being planned. It should be built and put into operation without too much time.

In addition, ASOS also wants to find ways to make up for the profit rate that is affected by the price reduction strategy. Earlier this year, Beighton said it would increase production in the UK in the next five to ten years, making it three times larger than it is now. This is also a way to reduce production costs by taking advantage of the exchange rate gap in order to seize the opportunity for the pound to fall. At present, only 3% of ASOS products come from the United Kingdom.

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