Sosandar sales growth continues but investments hit bottom line

Online women’s fashion retailer Sosandar released another trading statement today (20 January) detailing encouraging revenue growth in the third quarter of its financial year.

Net revenue of £3.8 million was reported for the three months to 31 December 2019, which was up by 136% year on year and ahead of the £2.8 million generated in the entire first half of its financial year.

Revenue for the full year is on track to be ahead of market expectations, although the retailer – which was only founded in 2015 – admitted its investment in acquiring new customers through marketing and new product development will result in a net loss for the full year. This loss is also expected to be higher than previously anticipated, although Sosandar is confident in improving its bottom line by retaining customers in the long run.

Top-line growth was attributed to a product range expansion and increased TV advertising investment, which has helped the business increase its active customer database to 110,000 – an increase of 93% on the same period one year before.

Repeat orders in the final quarter of 2019 reportedly increased by 140% year on year to 51,320, which the retailer said boded well in terms of customer loyalty. Other nuggets of information issued in today’s trading update showed its average order value for the period was £101.97, conversion rates were 2.72%, and returns levels were at 49%.

Ali Hall and Julie Lavington, joint CEOs at Sosandar, commented: "The opportunity we identified appears to be bigger that we first thought, with the success of new product areas helping to drive repeat purchases increasing the potential for future ranges.

“This has been enhanced by the successful trial in TV advertising which, combined with the already established channels of social, direct mail and PR, expands our ability to attract more new customers than originally anticipated.”

They added: "Acquisition of customers is nothing without successful retention and that's why it is so pleasing to see that repeat customers in January, a traditionally difficult trading period, are tracking higher than in the peak autumn/winter period helping to continually improve the ever-growing lifetime revenue number.”