Asda plots international growth for George

Asda is extending its online fashion brand into 24 countries as part of efforts to grow its general merchandise business, as it reveals a slowdown in sales across its business in the final quarter of last year.

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Asda will roll out its George.com online fashion business into Europe for the first time later this month as well as extending its reach in the Middle East with additional franchise stores.

Speaking at the supermarket’s full year results presentation today (21 February), Andrew Moore, chief merchandising officer for George and general merchandise, claimed George is the third largest clothing retailer and the fastest growing online fashion retailer in the UK.

Asda plans to grow its clothing and general merchandise business in the UK by attracting what it calls “occasional shoppers” with innovative ranges. One aim is to increase the fashion credentials of its homewares ranges. Moore told Marketing Week that Asda’s marketing for general merchandise is not as advanced as the marketing strategy for its clothing business and there are opportunities to “dial up” marketing in this area.

More than 60 per cent of Asda’s online clothing sales are through click and collect, which the supermarket launched in September last year and more than a quarter (26 per cent) of online sales come through mobile.

Asda says part of its success in fashion is its commitment to every day low prices and claims that just 18 per cent of its sales were on discount last year, compared with the market average of 32 per cent.

News of the expansion comes as Asda reports same store sales remained broadly flat in the final quarter of 2012, up just 0.1 per cent year on year in the 14 weeks to 5 January, marking a slowdown in growth. Speaking at the same event, financial director Richard Mayfield claimed the slowdown is in part a result of increased investment into keeping the price of basic items such as milk and bread low as well as strong comparisons to the same period the previous year.

Although Asda did not reveal figures for profit, Mayfield says profit grew faster than sales during the period.

The supermarket reported a 1 per cent rise in same store sales for the full year. CEO Andy Clarke says he is “proud” of the performance in food, clothing and general merchandise and reiterated Asda’s “long-term and strategic” commitment to every day low prices and round pound pricing. He pledged to continue to keep prices of essential products low following a £100m investment revealed last summer.

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It was really refreshing to read Mindi Chahal’s positive story on the high street last week. It has been a tough start to 2013 for many as the high street’s evolution gathers pace, and it was good to hear that brands harnessing their customer relationships in ever more creative ways are those enjoying success.

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