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NAKED FEATURE – ASOS – A Phoenix From The Ashes?
by Claire Etchell | 24th June 2014 | Naked Feature | 0 comments
Just as I had landed in Croatia this week, I got a text from a friend utterly alarmed that the ASOS website was down. At 5.56am she sent me this picture captions 'wowsers'. And wowsers indeed, because in this day and age it had to be quite the emergency to think about pulling the plug on your whole website, even if there is a fire, it's the kind of thing that would give an ecommerce team a sleepless night.
But pull the plug they did on Friday night, 20th June, reopening at 2am on Monday 23rd June after confirming 70% of its £159 million stock was held at the location and 20% of it has been damaged but alas they were insured for the loss and business interruption. So for three whole trading days the shopping platform and social centre for thousands of twenty something's ground to a halt. It doesn't surprise me that the news broke so quickly, when I was in my mid twenties and working in an office we would all routinely check ASOS about 50 times a day, obsessed with the latest looks and seeming them on a 6ft model down the runway and imagining ourselves wearing them on a Saturday night.It is the first ecommerce touch point for the young fashion conscious shopper. Yet the fire is a stark reminder that online can be touched by real forces and are not exempt from the elements. They may not have a physical shop, nor may they want one, but they still have stock and systems that manage them, and it was the warehouse in Barnsley, South Yorkshire that held so much of their stock and was the victim of an arson attack last week.
My response to my friends text was 'again?' because anyone who has been in the industry long enough, will remember that when they started up as As Seen On Screen there was a fire which put them out of action. It took a bit of research for me to realise they were out of action for five weeks that time round, and I remember wondering if they would recover at all. I needn't have worried the online retailer has grown from strength to strength, so logically speaking, I assume this time the fire will be another hurdle rather than a roadblock. Much has been said about the etailers decision to shut down the website altogether during this time, with questions raised about whether they should have left it open for browsing. If you are interested in looking at the nuts and bolts of ASOS's decision to temporarily close, it is worth looking at CEO of 7thingsmedia's Chis Bishop's article on LinkedIn on the industry's reaction to the news, scroll to the end for spirited debate.
I'm in the second row at The Industry London (taking notes of course)
However I feel it was the right decision. I was lucky enough to be at an event for The Industry London where WGSN's Lauretta Roberts interviewed Nick Robertson and everything he said was revealing. He comes across as self affacing, somewhat of an accidental entrepreneurial success who survived the online crash by simply not getting investment and ploughing cash back into the business as soon as they made it. He said "Dare I say it, we raised so little cash In the early days, we never had to sit around with financial men." He talked of the start of the business, how in the early days they got lucky with a talented fashion buyer and when that sector of the business started to work for them, they stuck with it. His eureka moment was making it look like a magazine. He's also not afraid to change his mind, the ill fated realignment to try to tap into the thirty something market with more expensive clothing and experiments with children's clothing, all buried in the past now, as he admitted that they were marketing to people who couldn't afford it. Now they are resolutely devoted to the 20s….cutting off at 30, exactly. Which counts me out at 33, and so it should. My last attempt to shop there (must be at least 5 years ago) was a piece which was on the cover of Vogue's high street edit – a zebra sequinned mini dress. I was in love. I think the price tag was £50 but the quality was so bad I sent it straight back. And that's when my affair ended.
Alas in the same way I didn't need a sequinned zebra mini dress, ASOS didn't need me, and they were eyeing up reaching a billion sales this financial year – although this may be a spanner in the works. The decision to close the website during the fire would have been a collective one, the customer service and marketing teams are all in-house, so you can imagine they all stood together in their decision to be honest and transparent with their customer, rather than take orders they may never fulfil. As Robertson said; "Don't underestimate service. It's the reassurance factor and twenty something's aren't super served by anyone.' It is that thinking that led him to introduce free shipping saying "Free delivery and free returns, it takes all the emotion out of it."
ASOS's Nick Robertson with WGSN's Lauretta Roberts at The Industry London
Robertson paints a picture of ASOS HQ being as fast-moving, organic and spirited as his customer. When asked about organisational structure he said "Structure never wins anything, it's all about the key people. We're lucky we employ a load of twenty something's, and they don't often like structure." My favourite question was about the most cost effective marketing to which he answered "PR, PR, PR" which he elaborated to say that they brought that side in-house very early on. Their product placement with celebrities, strong editorial pieces and fast moving work with bloggers has led them to a strong position. And the team, like it or not, certainly got their headlines from the fire story, far more perhaps than if they had kept trading.
So the fire will have stirred everything up for ASOS at a time when they had just announced that it's full year profits were likely to miss targets and sent them into a tailspin of discounts to recover. However they've plenty to be positive about having just launched their stylist programme, which although rough around the edges aesthetically will again look to super service the twenty something generation, they're opening in China ("That looks like an interesting journey" Robertson said, "our phone lines have already been hacked put it that way') and he admits to owning part of a drones company.
"Its been luck at every junction it's luck that people started online shopping. It's lucky you could go global with a website." He continued "It's luck again that we're in London, the fast fashion capital of the world." I beg to differ, because building a successful online business that can be robust enough to withstand the peaks and troughs of the economy and survive not one but two warehouse fires, and continue to grow and stay true to their USP and their customers, that's more than luck, that's a smart businessman and a very clever adaptable team. I wouldn't be betting again ASOS rising up again like the Phoenix from the ashes.
Watch the interview from The Industry London
Visit The Industry London website to find out how to become a member here.
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