Shop Direct reports fourth year of sales and pre-tax profit growth

By

Barbara Santamaria

Published
Sep 6, 2016

Online retailer Shop Direct saw its pre-tax profit surge by 43.6% to £150.4 million in the year to 30 June 2016, driven by a strong sales growth at its online department sore Very.co.uk, expansion in mobile transactions and continued cost saving measures.

The 53-week period represented Shop Direct’s first full financial year as a pureplay digital retailer, having ceased its catalogue accounts in January 2015.

Sales across department stores were up by 4.3% to £1.86 billion. In the period, the group’s flagship retailer Very.co.uk experienced the largest growth with a 15.9% increase year-on-year to £1.12 billion. This is the first time the online department store hits the £1b mark.

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Shop Direct also operates the digital department stores Littlewoods.com, VeryExclusive.co.uk and LittlewoodsIreland.ie, all of which reported an increase in web traffic, reaching on average 1.2 million visits per day. Additionally, 62% of all online sales came from mobile devices, up from 56% in the previous year.

Alex Baldock, CEO of Shop Direct attributed part of the growth to the group’s investments in technology. “We’ve made big strides in m-commerce, big data and personalisation. But there’s a lot more to play for in these areas. In particular, we believe that artificial intelligence can change the game for us in data and personalisation. We’re deploying it already and are serious about going much further,” he said.

The UK company has placed a particular focus on creating a personalised user experience for its customers. In the past few months, Shop Direct appointed a customer intelligence director and hired its first head of data science and digital analytics to devise a strategy to better understand its customers. Additionally, Sasha Berson has joined from Groupon as group strategy and customer director.

“We continue to gain market share profitably, and are on course for another record year of sales and profit. We’re confident that, if we stay true to our strategy and to what makes us special, we’ll continue to succeed,” said Alex Baldock.