Boohoo co-CEO Carol Kane discusses the fashion e-tailer’s international growth plans, brand positioning
British fashion e-tailer Boohoo recently opened offices in the heart of Paris, after those in Manchester, London and Los Angeles, to boost its business in France. Boohoo, which earlier this month poached its new General Manager from Primark, distributes exclusively online also sister labels PrettyLittleThings and Nastygal. As co-founder Carol Kane explained to FashionNetwork.com, Boohoo’s main assets are its high-speed response to the demand for best-selling items, the fact that half of the output is manufactured in the UK, and above all its affordable prices.
FashionNetwork.com: Why did you decide to set up offices in Paris?
Carol Kane: The French version of our website has been operational for two years. We used to manage our marketing initiatives from the UK offices. We worked with agencies, and also opened a pop-up store [in Paris]. The system worked. But we came to the conclusion that, to grow our business in France, we needed to have our own people there. This is why we sought out Nicolas Perignon [Boohoo’s Country Manager France]. Also, the way we communicate has rapidly evolved. Previously, we used to advertise on the underground or on TV. Now, Boohoo needs to have a direct line with influencers, in order to have a more agreeable, more direct voice on social media, as we have in the UK. Paris is our first step into continental Europe.
FNW: Besides France, which other countries are you currently targeting?
CK: We operate sites in French, Italian, German and Spanish, we are developing a Russian site and of course we have local-currency, English-language sites in Scandinavia. I think that one of our next moves will be to translate the latter sites into each local language, because e-tail is strong in Scandinavia and there is still only limited competition in the region. In the meantime, we are developing Australia, New Zealand and the USA, currently our largest overseas market (with about 16% of sales). Altogether, half of our sales come from overseas.
FNW: How does your supply chain work?
CK: We don’t operate like a classic retailer. Our system is called ‘Test & Repeat’: our buyers do not grade products based on their sales potential. We generally order 300 units of any one item and we restock if it works well. It is consumers who dictate what sells, and which items we will need to have a greater inventory of. This requires a certain discipline, as we buy only small quantities to begin with. It means that initial orders must be well planned, with a product mix which is often complex. And we also look at our sales history: for example, dresses account for about 30% of our business - they could grow to 40% next year, and during festive periods they have already reached 50%. Besides adapting to current sales results, it is necessary to constantly anticipate any variation.
FNW: Where does Boohoo produce its collections?
CK: We source from India, China and Turkey. But we also source from Europe, notably Paris and from suppliers based in Aubervilliers, Sentier and Marseilles, for quick stock build-up. We also work with Romania. But half of Boohoo’s products are manufactured in the UK. Boohoo is the number one client of the local textile industry. Above all, we have something other brands don’t have: about 50 between designers, pattern-makers and technicians, able to design and produce prototypes and launch production in 48 hours, the products going online in two weeks. You can’t get more ‘fast fashion’ than Boohoo. Notably because, contrary to what fast-fashion retailers do, we produce in small runs, except for the obvious best-sellers.
FNW: Which new product categories is Boohoo planning to develop?
CK: Boohoo has a nicely balanced footwear range, and we are planning to broaden it very rapidly. Last year we added beauty products, and the launch was satisfactory. We also rely on our petite and plus-size lines, a growing area of our business. Plus-size consumers don’t just want some clothes in their sizes, they want to have the same choice as everyone else.
FNW: Is Boohoo planning any other acquisition, after that of Nastygal?
CK: No, this is all for the time being, no more mergers or acquisitions for the next twelve months. Just think that, when we bought the brand name Nastygal, we had no website nor any stock. Yet we set up the website in 48 hours - it took some nerve - and we had to make a considerable effort to reposition and expand the brand. Nastygal is now well-established in the USA and in the UK. I’m also planning to have a word with our French team, because it’d be good if we did something in France to grow Nastygal, whose positioning is I think appropriate to the French market.
FNW: How would you describe Boohoo’s brands and their respective clientèles?
CK: Boohoo targets very young consumers, aged about 16-24, but it's highly inclusive thanks to the variety of its range: womenswear, make-up, sportswear, menswear and even clothes for big occasions. And it’s very strong on denim. PrettyLittleThings has more of a ‘celeb fashion’ vibe, with a more directional range and an aesthetic that’s so Los Angeles. Then there's Nastygal, with a rather vintage/heritage mood, targeting slightly older consumers, aged 25 to 35.
FNW: In your opinion, which are your main competitors?
CK: Oh well, they’re the same all over the world: Zara, H&M, Topshop and the likes of them. In pricing terms, Primark is also on the list, though it doesn’t have the same fashion positioning Boohoo has. Zalando, despite being a multi-brand e-tailer, contributes to educating consumers with regards to labels that are sold exclusively online. And of course there’s Asos, which paved the way to pure-player labels.
It took some time. I remember that when Boohoo started, we used to receive a lot of e-mails asking whether we had stores. Not to have them was a good decision. This allowed Boohoo to make its mark on the very tough UK market.
FNW: To make its mark especially with young consumers ...
CK: The new customers we acquire are mostly very young, aged 16 to 20, people who understand how Boohoo works. They have a very specific purchasing behaviour. Not so long ago, the first obstacle to buying fashion online was the fact that consumers couldn’t touch or try out the product. With free returns, this obstacle is now easily circumvented. Customers are now used to trying out the clothes in their own home, and to sending back those they dislike. For young people, buying online is second nature.
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