E-tail, if we’re honest, is one of those unfortunate words that inspires in
most of us a big, involuntary yawn. Equally spirit-sinking is the phrase
“fashion e-tail”, evoking as it does images of draughty warehouses in
Walsall posting out cheap frocks to the under-21s.
And then there is asos.com. This, in the unlikely event that you didn’t know,
is the online fashion store that was founded on making a virtue out of
reproducing the outfits of heat magazine celebrities such as Sienna Miller
and Paris Hilton, and knocking them out at a fraction of the price. Nothing
that has happened to asos.com in the seven years that it has existed can
truthfully be described as dull. The business has become something of an
online fashion phenomenon, second in size only to the mighty Next.co.uk, and
is changing all preconceptions about dreary old e-tail.
What started as a smallish operation selling pink faux-fur gilets “in the
style of Jennifer Ellison” (ASOS stands for “as seen on screen”) is now a
multimillion-pound business that has doubled its turnover virtually every
year since 2000. The gross retail sales for last year were £115 million and,
at Christmas, when many high-street retailers were weeping into their
groaning sales rails, asos.com recorded an 86 per cent increase in sales in
the seven weeks to January 20, not just bucking the trend but blowing a
raspberry in its face. In another coup, it recently poached Caren Downie,
Topshop’s buying director, who joins ASOS as buying director of womenswear.
“Fast fashion is only getting faster, and an internet model is a perfect
environment in which to showcase this,” she says.
Given this rosy picture, it’s not surprising to find that the company’s
new headquarters is in a great, swanky building, Greater London House, in
north London, where it occupies an entire floor and seems to be teeming with
staff (ASOS employs 270 people). One of the first faces I see when I go in
is that of Melanie Blatt, the All Saints singer, who is browsing through
samples from its new spring collection. That’s a turn-up, eh? A company that
began by tapping into the national fixation with celebrity now appears to be
attracting the celebrities themselves.
If you have ever used the website, which I have many times, then you will know
that its two main plus points are the speed with which it keeps up with
fashion, and the sheer amount of choice available. At any one time there are
more than 400 styles of dresses alone on the website, not to mention
mountains of tops, trousers, shoes, bags, lingerie, swimwear and jewellery
(there are 4,500 products in all), and an entire men’s section, all of which
is modelled by people walking on a real catwalk.
You can search via your chosen celebrity’s style – Kate Moss and Victoria
Beckham are the most clicked celebs, by the way – or just via day or
eveningwear. More recently, in a development that signals its growing
confidence, ASOS has diversified from merely copying the rich and famous and
now offers its own luxury brand, together with well-established labels such
as Antik Batik, Pinko, Rock & Republic, Public Beware, Christian Dior, Ted
Baker, Just Cavalli, American Retro and Miss Sixty. ASOS also sells a few
Balenciaga bags per month (though, speaking personally, if I was lashing out
£800 on a posh bag, I think I’d want the sales-assistants-sucking-up-to-me
experience that goes with it).
According to Robert Bready, the retail director, about 46,000 orders are sent
out every week. Normally, 200 new items are added to the website every week.
In the run-up to Christmas, that figure is nearer 400 a week. The goods are
posted out from a huge warehouse in Hemel Hempstead, to customers who find
they prefer clothes shopping from their armchair to traipsing the
rain-sodden high streets of Britain. It is only two years ago that the main warehouse
was hit by a huge fire that destroyed £5.5 million of ASOS stock. Despite
this ruining Christmas trading in 2005, and putting the company out of
action for weeks, it had bounced back within six months.
I’ll be frank and say that when I used ASOS in the very early days, the
results were hit and miss. Sometimes the clothes that arrived were great;
sometimes they were made of such crackly material that you were afraid to
stand too close to the fire. Neither did all of them look very much like the
original inspiration. But the quality has improved noticeably in recent
years. Bready says much work has been done to this effect: garment
technicians have been hired and specialists brought in from Karen Millen to
oversee quality control. The market has responded enthusiastically; the
website receives two million hits a month. The average per order is £50.
“The biggest advantage for us is that we don’t have bricks and
mortar premises,” says Bready. “While other buyers [on the high
street] have to go to the Far East to get better margins and it can take
weeks just to ship the stuff and get it ready to display in a shop, we don’t
have to operate to the same margins. We are able to use factories in Europe,
so our production times are much faster.” This can mean that from spotting,
say, Lily Allen wearing a new style of dress on the street one day, ASOS
buyers and designers are in a position to have similar ones made and ready
to sell in four weeks.
But surely the other big advantage to this is an ethical one? As increasing
numbers of consumers become guilt-stricken about sweatshop practices in
countries such as Bangladesh, then this is something ASOS could be shouting
about. Bready says that 60 to 70 per cent of its stock is made in Europe,
which is something that I would be putting on posters. But ASOS has as yet
done relatively little advertising because, as Bready says, they wanted to
get the product right first.
The idea for the company came from its chief executive, Nick Robertson – the
grandson of Austin Reed – and his business partner at the time, Quentin
Griffiths. They’d read about a particular lamp that had appeared in Friends
and inspired more than 20,000 viewers to call NBC asking where they could
buy it. It was at the time when there was an explosion of new celebrity
magazines, and Robertson noticed that many of them were pointing out to
readers where they could buy similar outfits to those sported by stars such
as Victoria Beckham – thus directing people to spend their money somewhere
else without even getting commission for it. Robertson decided to earn that
commission and, in the early days, ASOS would offer clothes “in the style
of” a certain star. Robertson has developed the range since then and
asos.com now offers high street and luxury brands.
In one of the side rooms at the HQ, Mariel, a striking blonde model, is
striding up and down the catwalk in a silver minidress and Terry de
Havilland shoes while a photographer shoots away. The catwalk has become a
permanent fixture; when it was introduced a couple of years ago, sales
promptly soared. The moving image, says Bready, “brought the clothes to
life”. Scores of such pictures a day are uploaded to keep the website
fresh and intriguing. Sameera Hassan, the company’s publicist, says many
customers log on twice a day. “Our typical girl lives and breathes fashion,”
she says. “The most-clicked section is called Just Arrived; what is in Just
Arrived at the beginning of the day is different to that at the end of the
day.”
Of course, what really matters is hard sales. In a high-street shop, 20 per
cent of customers on average buy something. When it comes to online retail,
the figure drops significantly: around 2.5 out of every 100 browsers will
buy. Then there are returns: an average catalogue company experiences about
40 per cent returns. But asos.com seems to be bucking the trend on both
these counts. Bready says that its “conversion rate” – ie, the number of
visitors to the site who buy – is 6 per cent and, at sale times, nearer 10
per cent. Meanwhile, its level of returns is much lower – about 22 per cent.
The rise of ASOS has been so rapid that there must come a point when its
success will plateau (it was named Fashion E-tailer of the Year at both the
2005 and 2006 Drapers Awards). The company is confident, however, that
growth will continue in 2008, a prediction that already seems correct
despite a possible recession. Robertson goes so far as to say, “If there is
a spending squeeze, for a business growing at this rate we can afford to
lose 10 per cent of sales. I’m full of confidence about the year ahead.”
This is partly because online shopping is continuing to grow in popularity,
and partly because ASOS is introducing new categories (maternitywear,
petites) which it believes will drive further expansion. One tool that will
help this is the asos.com magazine, a glossy handbag-sized affair that
features a different style heroine each month (Mischa Barton, Victoria
Beckham, Rachel Bilson and Lindsay Lohan are among recent cover queens) and
goes out free to 400,000 customers. There is a regular “Style Stalker” page
that tracks a particular celebrity down to their last accessory. Joining it
soon is a men’s version, which will come out twice a year.
Aside from increased household access to broadband, the celebrity gimmick has
been pivotal for ASOS, and not only because it has gone hand-in-hand with
the rise of celebrity-driven reality TV and magazines. “Celebrities come in
and out of vogue; they evolve and change, but there have always been and
always will be fashion icons,” says Bready. “If people see a celebrity
wearing something, it gives them the confidence to wear it, too.” What a
pity that we can’t buy the skinny hips to match.
