Website debacle overshadows solid first half for Baby Bunting
Technical issues with a new e-commerce site Baby Bunting launched last year, which impacted sales and forced the retailer to roll back to its old website in November, dominated a call with investors about the company’s first-half results on Friday.
Chief executive Matt Spencer said the retailer was working closely with the vendor to resolve a problem with the way promotions appeared on the checkout page, but could not say when the new site would be back up and running.
The relaunch is further complicated by the fact that there are only a few times throughout the year when retailers like to execute such projects, so they cause minimal disruption to online shoppers. Baby Bunting won’t make the first window, which is in March. The next window is in July, a full year after Baby Bunting originally launched the new website.
Spencer did not mince his words when talking about the debacle.
“The launch of the new website has been disappointing. It’s been a distraction to the business, and it has impacted sales performance,” he said on the call on Friday.
The website problems also created an influx in customer support requests, which led to an additional cost of several hundred thousand dollars in the customer care centre in the first half, according to Spencer.
After rolling back to the old website in November, Baby Bunting’s online sales growth recovered, from 7 per cent year on year in the four weeks prior to the rollback, to 21 per cent year on in the four weeks after the rollback, which included Black Friday.
Visits to the website were up 13 per cent in the half, compared to the previous corresponding period, and online, which includes click and collect, accounted for 11.7 per cent of total sales, up 10.5 per cent on the previous corresponding period.
The technical issues struck a sour note in an otherwise positive first half, in which Baby Bunting lifted total sales, opened new stores and eked out an increase in comparable store sales, despite the addition of several new stores, which cannibalised sales in some existing stores, and the challenges presented by the bushfires and weaker December trading period.
“Our results for the first half reflect continuing profitability, growth and significant progress on a number of our operational objectives for the year,” Spencer said in a statement to the ASX.