Online now Myer’s biggest store
An expanding range of products available online and a revamped website with faster search, better filtering and improved mobile capabilities helped Myer to lift its online sales by 25.6 per cent in the year ended June 30, 2019.
The retailer’s online sales, which include Marcs and David Lawrence, Sass & Bide and Myer Market, but exclude sales made via in-store iPads, totalled $262.3 million in FY19, and now represent 9.8 per cent of total sales.
Improving the online experience is a key component of the customer-first turnaround plan that Myer CEO and managing director John King introduced last September, and the retailer reported on the progress it has made so far.
Most of the focus has been on expanding the range of products available online, and improving the user experience on the website.
“We’re continuing to close the gap between in-store and online,” King told analysts and investors in an earnings call.
“We’re [working on] matching the [in-store] range by the end of the year, and then expanding the offer with products that are online-only,” he said.
At the same time, the department store is starting to see results from a new e-commerce site launched in September 2018, which offers an improved mobile experience, as well as faster search and better filtering.
“The NPS [net promoter score] of cusotmers who browse the site has increased nearly three times’ over,” King said in reference to the new site.
More work on the digital side is slated for FY20, with an announcement around the retailer’s loyalty program, Myer One, expected at the end of first half.
Myer reported a 3.5 per cent drop in total sales in FY19 to $2.99 billion, and a 2.9 per cent drop in comparable store sales year on year. Excluding sales in Apple products, which Myer exited in May, comparable store sales were down 1.3 per cent.
Both total sales and comparable store sales fell at roughly the same rate as they did in FY18.
Myer saw an improvement in operating gross profit margin of 65 basis points to 38.85 per cent, thanks to its increased focus on profitable sales, including a shift in the sales mix away from concessions and towards Myer exclusive brands. Operating gross profit was $1.2 billion, down 1.9 per cent year on year.
Myer posted a 7.2 per cent improvement in earnings before interest, tax, depreciation and amortisation to $160.1 million, excluding implementation costs and individually significant items related to redundancies and lease provisions. Its net profit after tax was up 2.2 per cent year on year to $33.2 million.
King made it clear the department store is sticking to the customer-first plan he laid out last September.
“We will continue to focus on the customer, we’ll continue to deliver against this plan in the best interest of our customers and shareholders,” King said.
“The plan we started is a plan we’re delivering against today, and will be the plan we’ll be delivering against in the coming months.”
King also announced the appointment of Tony Carr as the company’s new executive general manager of supply chain. Carr was previously head of logistics at ASOS.