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6 Reasons Why Asos is Winning the Apparel Game

Online retail has its share of winners and losers—and Asos is dominating apparel with its trend-driven strategy.

In its recent financial results released last month, the e-tailer disclosed that total retail sales increased 32 percent for the four months ended June 30. What’s more, the e-tailer expects its full year profit before tax (PBT) to be in line with market consensus, which it said was $105 million.

According to Edited, the e-tailer’s financial success could be attributed to several factors relating to its trend-focused strategy. While retail remains uncertain, Asos is staying afloat by prioritizing trends in its branding and pricing initiatives. From strategic discounting to a diverse inventory lineup, here’s how Asos has remained a key player in the e-commerce space.

Trends come first for Asos

While most of the U.K. apparel market is playing catch up, Asos continues to pave the way with its trends-first approach.

According to Edited, 41 percent of Asos’ current offering arrived in the summer months and the website receives more than 2,500 new products each week.

Unlike other retailers that introduce singular styles, Asos debuts full stories on its website. For example, the company recently launched multiple dresses, tops and kimonos in a vibrant yellow shade, which is expected to take Millennial Pink off the radar. Asos’ apparel stories are powerful because most products fall into the trending category, so consumers can seamlessly incorporate a new color or silhouette into their wardrobes.

Trends even come before price

Despite its good deals for fashion-forward garb, Asos isn’t trying to be the cheapest among its counterparts.

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According to Edited data, Asos’ price structure different from other trendy e-commerce companies. Asos typically pays more for on-trend branded products. In looking at products priced between $10-$20, 23.1% of Asos product falls in this space, compared to 37.4% of Zara’s, 48.4% of Boohoo’s and 32.5% of H&M’s.

“One way it differentiates its assortment is by working directly with brands to produce product with its own consumer in mind. In fact, 5 percent of the branded offering is merchandised as being ‘exclusive.’ And prices on those exclusives skew higher than the rest of the assortment,” Edited said.

6 Reasons Why Asos is Winning the Apparel Game
Source: Edited

Core apparel items remain key

Although Asos is primarily driven by trends, core apparel items are also an important part of its assortment. Core items sold on Asos include own-brand blue and black denim, strapless bras, simple blouses and Converse footwear. These items may also be mixed and matched with trendier products to create diverse outfits.

According to Edited, more than 8 percent of Asos’ core items were introduced over a year ago, which is more than other fast fashion competitors. Clothing that’s more than a year old only makes up 3 percent of Forever 21’s offering, while apparel 12 months or older accounts for just 5 percent of Topshop’s assortment.

[Read more on Asos: Asos, Nike Pledge to Source 100 Percent Sustainable Cotton by 2025]

A different take on discounting

Asos isn’t saturating its main collection with discounted items as other retailers have. The e-tailer places sale items in its outlet section, where consumers can shop for thousands of items up to 70 percent off. What’s more, Asos updates its outlet daily, so consumers can find sale items easily without having to browse around the site.

In addition to the outlet, Asos also relies on promotional discounts. The e-tailer typically sends out promotional codes via email, during sale-heavy months including June and December. According to Edited data, half of women’s email newsletters from May to July mentioned sales.

Menswear remains secondary

While womenswear continues to sell out quickly on Asos, menswear remains behind. Although menswear makes up 38.5% of Asos’ apparel offering, this category generated only 23.8% of full price sales. Asos is focusing more on womenswear consumers and using technology, including its new fashion app, to tap into the apparel needs of this demographic.

Diverse own-brand assortment

Asos is also taking over consumers’ wardrobes with its own-brand assortment. The e-tailer currently offers its own main, petite, tall, maternity and plus-size lines that resonate with a range of consumers. According to Edited, one-third of Asos’ assortment is its own-brand.