There’s no denying it’s been a tough few years for Asos. Since the online boom of the pandemic died down, it has grappled with the resurgence of physical retail, fierce competition from the likes of Shein and pinched wallets amid the ongoing cost-of-living crisis.
After pulling in an almost £300m full-year loss last year, the online retailer has been in turnaround mode, clearing stock and resetting its commercial model to focus on profitability. But now the retailer has its eye on growth opportunities as it looks to move towards its goal of returning to profitability in 2025.
As the world gears up for a whirlwind summer of sports, including the Euros, which kicks off this evening, and the Paris Olympics, Asos is making sure its sportswear offer is primed to win.
Asos head of sportswear Tim Williams and director of Asos Media Group Elton Ollerhead catch up with Retail Gazette to share how its sports offer is helping drive growth at the retailer.
Asos’ growing sports offer
With over 800 brands available online, including 20 sporting favourites such as its own label 4505 to titans Nike and Adidas and industry disruptors such as On Running and Tala, Asos’ sports offer has grown rapidly over recent years to meet growing demand.
Williams says: “Sportswear has been an important category for a long time. With the key events happening this summer, specifically the Euros, the Olympics, and Paralympics across two of our key European markets, it feels like an amazing time to really blow up sportswear.”
He calls Asos’ sportswear offer a “unique” one within the category because its “very much through a fashion lens”, unlike traditional sporting retailers such as Sports Direct and Decathlon.
“Whether you’re looking for trainers to wear to the pub, a t-shirt to the beach, or activewear to actually work out it in, it is all part of what the sportswear message is throughout the Asos journey.”
Williams says there is an opportunity to “spotlight and enhance” the sportswear brands it stocks during this pivotal summer of sports to drive growth, which is where its retail media offer comes in.
There has been a goldrush in this space over the past year or so as brands try to reach customers through advertising on retailers’ websites. It’s becoming big business for retailers too with retail media sales set to top £22bn by 2026, according to trade body IAB Europe.
Ollerhead explains that Asos Media Group will be working with sportswear brands to help them “win on Asos” during this summer of sport.
“They want to sell their product on Asos and so do we. So we really want to work close with them. It’s about amplifying what they’ve got, be it a new seasonal launch or a new product launch.
“We align it with the calendar and over the summer we’ve got a host of different sporting events which we know our customers are going to be really interested in.
“They will be dressing for a lot of those things, so we’re looking at which brands are going to resonate really well over the summer, so we can specifically highight that.”
He uses the example of On running, which has a “fantastic partnership” with movie star Zendaya.
“They want to amplify that with us so we’re going to be working closely with them using some of the fantastic imagery they’ve got.”
He adds this collaboration, which is one of many taking place this year, is expected to resonate strongly with Asos’ customer base, given Zendaya’s popularity and her prominent role in the recent sports blockbuster ‘Challengers,’ released earlier this year.
Evolving customer needs
While Asos already boasts successful clothing, footwear and face and beauty offers, Williams emphasises that sportswear “continues to be a huge part of the consumers’ day to day wardrobe”.
He notes that one of the few long-lasting trends post-Covid is that consumers are “more active”.
Williams says that Asos has a “really unique point of view in the marketplace” as it appeals to shoppers that want their sportswear to be fashion focused.
He highlights the consumer that might want to wear an England shirt to the pub, but pair it with their Topshop jeans and Birkenstock sandals or Doc Martens.
“These are all brands that sit in the Asos portfolio, and you can go one step further and think about the hair and makeup and the styling. The work that [its creative team] Asos Studios does in terms of bringing those looks to life really allows us to speak to that consumer.”
The sportswear boss also explains that shoppers are seeking versatile products that can be used across various activities.
“We’ve got customers that may want to go for a run, do yoga or just lounge around – they don’t need to buy 10 pairs of leggings. We’re talking to a fashion concious 20 something – they want a look which makes them feel best but that also allows them to do a myriad of activities,” he says.
“The way we’re approached the category is about looking at it as an extension of our day-to-day fashion journey rather than something that sits independently.”
While remaining coy on its growth targets, Williams says the category has “been strong” which he says is partly due to the partnerships it has forged with a number of key sportswear brands, which see its “unique positioning” as fashion-led sportswear destination as a “key USP and something which is helping the market grow”.
As the online giant looks to bolster its range and grow, Williams says Asos will continue to lean on its relationships with partners, particularly from a global perspective.
Both he and Ollerhead recently spent time in Portland, Oregon, speaking to two of Asos’ biggest sportswear partners, Nike and Adidas, to understand how Asos can expand and grow sportswear in the US.
Williams explains that expansion in that market is “a huge opportunity” because most major sporting retailers there focus purely on functional products.
Sportswear trends
With consumers’ minds more geared towards sports now than ever, Williams says Asos has seen “trainers coming back very strongly”.
Meanwhile, the recent football shirt fashion trend has seen the sporting jersey transcend the boundaries of sports to become a significant statement style in everyday wear.
Williams calls the trend “interesting and important,” especially with the Euros kicking off this week.
Asos sees “huge amounts of styling opportunity outside of the tournament,” which works hand in hand with the broad range of jerseys available on-site, from current team options to popular vintage iterations.
He says the opportunity with the Olympics, which begins next month, is “slightly different, because we’re not going to sell a lot of the activities done in the Olympics as a lot of those are fairly inaccessible to our consumers”.
However, he notes that with the Olympics taking place in Paris, which he calls “the capital of style globally and one of our key European markets,” there’s still a significant cultural moment for the business, “rather than a specific product allegiance”.
Despite its recent challenges, Asos’ focus on growing its market position in important categories like sportwear and meeting the evolving demands of its global customer base are positive steps forward.
As the world gears up for a summer of sports, the retailer is well-positioned to capitalise.
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