THE (POST-BREXIT) WINNER TAKES IT ALL

This week we explore: who are the winners in the Post-Brexit retail game?

 Prime opportunities for tech toothbrushes: While the British public were glued to their screens watching the Brexit soap opera continue to unfold, online shoppers were quick to snatch a deal or two on Amazon PrimeDay on July 13th. Heavily discounted gadgets like the Bluetooth-enabled Electric Toothbrush (of course) emerged as a bestseller, with an overall product spike of 63-90%. Sensible choice, as the new Prime Minister Theresa May is already talking about more privatising of health services, so taking care of one’s teeth may save punters thousands of pounds. Amazon have already sprinkled their mini-warehouses around London and are now putting their octopus-like tentacles around more extended areas of the capital. Competitors watch out – once on Prime, the customer never leaves.

Smart fridges for smart property owners: Apart from gadgets, headphones were a big winner on PrimeDay and also topped the sales charts in John Lewis, as people are preparing their holiday kit. But the real driver of sales increase reported by the brand was the Home Hub where, after years of investments in the John Lewis Lab and supporting start-ups, the fruits of the innovation labour are materialising. Home comms, cameras in the fridge, voice-controlled ovens and entertainment as well as Internet of Things home security products will do well during the upcoming Brexit recession, as wise people put the brakes on selling their homes – spending a bit of cash on DIY, new furniture or home entertainment products instead.

The great Asos homecoming: Grandiose illusions are part of the British psyche, and alas this is not a syndrome confined to just local politicians. Asos has just admitted they bit off more than they could chew with their Chinese expansion, now turning the lights off on one of their more misconceived adventures in the east. Cultural sensitivity is sometimes not a strong British touchpoint and certainly a degree of humility while dealing with Chinese clients is in order. No amount of AI or Siri power-up will replace common sense, so Asos will now focus on Europe, where the sales growth is healthy and increasingly mobile-based, as 66% of sales are now from mobile devices. Good decision since Asos is actually one of the brands tipped to do well out of Brexit, as the low pound at home will improve the competitive offer to young fashion-hungry Europeans.

From one e-com platform to another: Change is often a pain and there is no bigger pain than migrating e-com platforms. Having just completed one for rapidly growing forward-fashion lingerie brand Bluebella.com, we were in awe of how Figleaves kamikaze-d migration from a well-honed, fixed-costs proprietary e-com platform to Demandware. As much as we love personalisation – a strong forte of Demandware – the commercial aspect of having to pay them a percentage of sales is a strong enough reason to hang on to your good old Magento. We will soon be bringing out a detailed analysis of Demandware for Figleaves so watch out for the next briefing. The lingerie brand will now be able to trade multicurrency from one store, saving on the duplication process, and we certainly think that being able to create pages for each customer on the fly is a great feature so we’re expecting strong sales growth as conversions increase.

And the Brexit winner is: Oxford Street! The first victim of Brexit is the commercial property sector, as an emergency sale of a £150m Oxford Street block is already being undertaken. The owner, Aberdeen Asset Management, which has the freehold, has been pressed by investors (mainly foreign) wanting to take their cash out, frightened of the value drop of about 17% since June 24th. However, as the block contains some major fashion flagship stores, and with the pound being so low, it’s expected that prime shopping areas like Oxford Street and Bond Street will do well. They could do with some good news since in June the shares of luxury fashion companies went down by more than 17%. Silver lining for a change.

What’s happening with tariffs in the post-Brexit retail world? We will be preparing a briefing for the end of September, but here is the outline of what’s likely to ensue as the UK is starting to set up and realign individual trade deals. Send any of your Brexit-related questions or needs to hello@theretailpractice.com.