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Published
Mar 5, 2018
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UK pureplay fashion e-tailers are soaring, consolidation expected

Published
Mar 5, 2018

The UK’s pureplay e-tailers are thriving, despite the tough retail backdrop, and the surge in mobile shopping app downloads has helped to accelerate the move away from physical stores.


Asos


That’s the conclusion of a new report from professional services company RPC, which said sales at Britain’s 20 largest e-tailers rose as much as 23% last year to £8.4 billion.

Their growth wasn’t just a response to consumers loving apps more than websites as RPC’s co-head of retail Jeremy Drew said companies have worked hard to boost the functionality, sophistication and therefore the appeal of those apps. Tech such as AI chatbots, ‘snap and shop’ options that offer visual search via smartphone cameras, and augmented reality within apps all helped boost their adoption.

And Drew said that tech enhancements and m-commerce maturing are helping e-tailers to “super-charge” their sales. 
Some 53% of online purchases were made via smartphones in the last quarter of 2017 (according to Criteo data). And with both m-tail and regular computer-based e-tail sales both rising, even traditional bricks-and-mortar retailers depend increasingly on their webstores for sales growth, RPC said. 

A number of successful big names have reported strong online sales growth, from Ted Baker to Joules, and RPC highlighted M&S. Its e-sales rise last year may have been tame at 5.6%, but it still beat the sluggish 2.2% increase in total group revenue.

Jeremy Drew also said the rise of online retail has handed power to pureplay operators in the UK market as they’ve gone “from being virtually unknown five or 10 years ago,” to a situation where they’re “building strong brands and grabbing more and more market share.”

But RPC’s other co-head of retail Karen Hendy also said that the pureplay growth spurt could result in a wave of consolidation among e-tailers. That was already seen last year as Boohoo acquired Nasty Gal and PrettyLittleThing, albeit there was an existing connection given that PLT was founded and managed by the sons of Boohoo’s founder. 

“Some of the larger players will be keeping an eye out for fast-growing platforms they can bolt-on, in order to rapidly grow their customer base or to give themselves a foot in the door of new markets,” Hendy said.

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