BrandAlley plots Australian debut as profitability nears

Australian consumers love British brands according to Feldmann and the seasons complement each other. UK brands enter Sale period for products as they come into season in Australia.

Feldmann said it had little homegrown competition in Australia other than Sir Philip Green’s new acquisition MySale, which he said was focused more on sporting goods and sold less branded products than BrandAlley.

International shipping is set to boost BrandAlley’s sales growth. The etailer is forecasting a 5% sales growth in 2014, which it said would grow to 7% to 8% when overseas delivery is launched. 

In 2013, BrandAlley sales edged up 1% over 2013 to £33m, although it still made a loss. Feldmann said: “We put enormous investment into marketing. So all the cash coming out of the business is going straight back in. We’re growing the membership base. Profitability will be next year.”

The flash Sales site boosted membership 20% year on year in its first quarter as it ploughed investment into TV advertising. It has started a second TV campaign this month.

Menswear growth

BrandAlley is also eyeing growth in menswear. It is looking to add more menswear brands and Feldmann said he would to move the sales mix from 30% to 40% menswear. Next day delivery is also “on the radar” for customers in big urban centres, which he said would be a “real differentiator” in the flash Sales market.

“Sometimes you’re buying a dress for the Saturday night and you just want to make sure it comes the next day,” he said.

BrandAlley marketing director Melissa Littler said the team had achieved “amazing brand success” following its MBO last year from former joint venture owners News International and BrandAlley France. Diane von Furstenberg and Temperley are recent examples of Sales on its site.

Littler said: “We can be quicker and more flexible and don’t have to get [former joint venture owners] News Int or France involved.”

She said that despite the failure of rival flash Sale site Cocosa, consumers still loved the format. “Cocosa were quite niche with their brand range. It was really top-end so they’d have smaller stock packs and things were regularly sold-out or the sizing was really difficult. Our members love the mix and match. They’ll buy a Prada handbag but equally they’ll buy French Connection.”

Littler said that brands were focusing on using its site to ensure their stores were experiential.

Feldmann added: “We’re part of their trading calendar now. They work with us to minimise the amount of time they are on Sale on the high street.”