1. Comment
September 28, 2018

End of ASOS A-list may irk shoppers but UK sales likely to be unaffected

Despite furore on social media, the impending closure of ASOS’ A-list program announced this week will not cause the retailer major problems as it has a second loyalty driver to fall back on – ASOS Premier.

By GlobalData Retail

Despite furore on social media, the impending closure of ASOS’ A-list program announced this week will not cause the retailer major problems as it has a second loyalty driver to fall back on – ASOS Premier.

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by GD50 Custom
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In contrast to many of its midmarket competitors such as River Island, Zara and Topshop, online pureplay ASOS has two loyalty levers, one of which it is axing next month. Given the competitive youth fashion market and the powerful impact loyalty schemes have on young consumers’ spending – 71.6% of loyalty scheme subscribers aged 15-24 said being a member has encouraged them to spend more at that retailer (according to GlobalData’s survey of 2,000 online shoppers) – players offering a loyalty scheme have a clear advantage.

This is demonstrated in ASOS’ consistently strong trading with its most recent results (for the four months ending 30 June 2018) showing UK retail sales accelerating, up 22.8% on last year, against a 15.5% comparative, far outperforming growth in the UK clothing & footwear sector – although this is not solely down to its loyalty programs.

Shifting customers to ASOS Premier

The end of ASOS’ points-based reward scheme, ASOS A-list, will upset loyal customers (evident from feedback via its social media channels) but the promise of better rewards, a £10 gift voucher as compensation, along with the fact that many customers have already paid for a year’s worth of next day delivery via ASOS Premier, will keep shoppers coming back.

ASOS Premier is the second most popular non-food delivery saver scheme in the UK, according to GlobalData’s E-retail survey of 10,000 online shoppers, and has a significant impact on spend, with 63.2% shopping more often since signing up. At just £9.95 for a year’s subscription, the scheme is accessible and once locked in, it encourages subscribers to visit ASOS as their first port of call.

ASOS has shrewdly used the communication of its ASOS A-list closure to promote its Premier delivery proposition, encouraging customers to sign up using the £10 gift voucher they will be awarded as the loyalty program ends. Although shoppers may be enticed to take the opportunity to receive free express delivery, ASOS must ensure it quickly delivers on its commitment to provide better rewards in order to make amends to the loyal customers it has disappointed.

Free Whitepaper
img

What is the impact of historically high inflation on the UK consumer landscape?

The average UK consumer is experiencing a severe cost-of living crisis as inflation surges to a forty-year high and the price of goods continues to rise. This shock is the result of the sharply increasing costs of commodities, energy, and the ongoing conflict in Ukraine, and is threatening FMCG manufacturers, retailers, and foodservice operators’ ability to survive and grow. Inflation will have a profound effect on many consumer-facing industries in 2022 and beyond. Consult GlobalData’s new whitepaper, Inflation in the UK: The Impact of Historically High Inflation on the UK Consumer Landscape, to better understand shifts in consumer behavior and their impact on spending patterns, as well as the implications for UK businesses. This whitepaper covers:  
  • Why has global inflation returned with a vengeance?
  • What is the current inflation situation in the UK?
  • What impact is inflation having on UK retail sales?
  • What tactics are businesses relying on to tackle the effects of high inflation?
  • How are consumers changing their behaviors to cope with the higher cost of living?
  • Which industry sectors are most vulnerable to reduced consumer demand?
  • How is the government responding to high inflation?
  • How long will high inflation last in the UK?
  • How can your company survive and thrive in a high inflation environment?
Enter your details here to receive your free whitepaper and ready your business for these increasingly uncertain times.
by GD50 Custom
Enter your details here to receive your free Whitepaper.