How Asos has changed the face of eCommerce

This week, the city woke up to the announcement that CEO and founder of Asos, Nick Robertson, has stepped down from his role and handed the reigns over to COO Nick Beighton.

Over the last 15 years the e-tailer has been changing the way UK customers shop online. And it has been Robertson who was the driving force behind the company which turned a pre-tax profit of £54.7 million last year.

Rebecca Marks, retail consultant at Conlumino, said: " Robertson built a multibillion pound global company, cleverly building onto the WAG culture from 10-15 years ago, and then turned this into the ultimate destination for high street, catwalk and vintage trends for men and women.

"Whilst retaining its winning edge, with outperforming online fulfilment capabilities and utilisation of social media interactions to drive consumer sales, Robertson not only drove growth at Asos, but drove change in the way consumers shop for fast-fashion trend led products."

How has Asos changed eCommerce?

From being bold with online delivery to innovating with returns, Honor Westnedge, lead retail analyst at Verdict, goes as far as to say Robertson revolutionised UK fashion retail online.

"Asos is the fastest growing and largest fashion pureplayer in the UK and Robertson did this by having a really strong own-brand – not just making Asos a marketplace for other brands.

"He also made shopping online fun, enjoyable and engaging for customers – something fashion retailers hadn't really done before."

Westnedge described how Asos was the first e-tail to innovate with editorial using style advice blogs, while also introducing technologies such as live chats, recommendations and outfit building – "all those features we now expect on fashion websites, Asos led the way."

"Because Asos was a pioneer and the first player to really develop an established enjoyable online experience, other retailers followed in its footsteps," she said.

Westnedge explained that Asos managed to understand what their customers wanted despite not having a physical presence, for instance, many 16-24 year-olds like to ask the opinions of friends before purchasing, so Asos was one of the first fashion e-tailers to encourage customers to share links to clothes on social media.

"This means customers don't feel like they are missing out having to shop online," she added. "Asos always pushed one step further, asking what aren't customers getting online that they can get in a physical store."

This translated into social sharing, editorial and the way Asos innovated helping helping customers through instant messaging. "This helped to make customers loyal because they provide a really good service."

Online delivery

Asos was also an industry pioneer in terms of cheap delivery and free returns. While uptake of its Asos Premier delivery membership – which offers unlimited next-day or nominated day delivery for an annual fee of £9.95 – has grown 70% across the globe since last year.

"This means you have customers coming back really regularly, and people are going online every week to see what's new in."

Asos is also renowned for its free returns policy using a variety of carriers including Royal Mail, Doddle and Collect+. "Asos made returns very easy and this took other fashion players a long time to develop, the varied options ensures loyal customers," explains Westnedge.

But to an extent, Asos has been a victim of its own success when it comes to free returns, with Robertson wanting to find a technology which could reduce this costly service, ensuring customers order the right size and style first time.

"But it's now ingrained in consumer shopping habits to order lots and send it back," argued Westnedge. "And the technologies – like virtual fitting rooms – haven't really taken off. Maybe this is something Beighton could pioneer and make the norm?"

Beighton's to-do list

Retail analyst, Nick Bubb, said Beighton will be stretched thin for the next few months as he gets used to his new role and ensures the new ASOS financial director, Helen Ashton, settles into the job she only started this week.

He said: "But I’m sure everybody will get on and Beighton and Robertson are close buddies - as Robertson said in his email to staff yesterday 'Having worked very closely with Nick B over the last six years, I can honestly say there is no one more qualified or deserving. He shares the same values - he works tremendously hard, has fun in the process, he engages with everyone and believes firmly in the huge opportunities that lie ahead'."

Westnedge agreed the two have a close relationship working together on a clear strategy for future growth, which Beighton will be sure to continue.

She said the retailer will have to continue to innovate at speed, "technology goes out of date really quickly, and if you are not investing and pioneering new technology you become dated."

Spencer Izard, head of European retail insight at IDC, agreed that Asos drove innovation through its use of mobile and marketplace strategies much earlier than its rivals.

"The challenge though for Asos will continue to be how to provide a differentiated experience to customers when other retailers imitate aspects or all of their approach," he said.

Growth opportunities

Westnedge also said Beighton will now have the responsibility of sustaining UK growth.

"It's been impressive over the last year, but over the next five to 10 years, how is he going to sustain this growth now it is a mature pureplayer?"

Westnedge said Beighton should be thinking about new channels and routes to market: "Maybe putting its own brand clothes into department stores, opening physical stores, or expanding click & collect?"

"Robertson always focused on having a strong position online, rather than having his fingers in too many pies," said Westnedge. "But this could be an opportunity for Beighton to develop the brand further.

She also said Asos might look into targeting new customer bases, including homeware, childrenswear, strengthening its beauty offering or targeting more mature shoppers.

The other big focus for Asos is developing its international markets. "It took a long time to launch in China," noted Westnedge. "And it needs to target other developing countries like India, Africa and Brazil because we're seeing a growing demand for more Western products from these countries.

Izzard added: "The approach to eCommerce that allowed Asos to rapidly deploy an online store in a new country was envied by most of the large retailers operating in and across Europe. This had a profound impact on how eCommerce evolved for many retailers who understood that they needed an approach where they did not reinvent the wheel for every country but rather kept the same foundation with only certain regional changes."

Westnedge concluded: "Beighton will need to consider what has worked in China and how Asos can expand into those developing markets where few Western players have yet to get a foothold – this will give Asos a strong position before its rivals," she added.