ASOS has a reason to celebrate. After missing analyst sales expectations in Q3, the UK firm hit annual sales growth forecasts and reported a 28% rise in pretax profit, sending the firm’s stock rising by 16%. This growth corresponds to Gartner L2’s analysis, which finds that the pure play giant is digitally Gifted. ASOS ranks fourth among 60 brands in Gartner L2’s upcoming Digital IQ: Specialty Retail UK, just shy of Genius status.
Forecasting that online sales will hit 30% overall by 2023, the brand has created a sophisticated site experience for consumers. The retailer uses your browsing history to surface product recommendations and tailors shoppable homepage content by gender. Additionally, each of the #ASOSinsiders (the brand’s legion of micro-influencers) has a unique category page featuring items recently recommended on his or her Instagram. The brand also over-indexes on product videos, displaying stylized product videos on nearly every product page despite rapid assortment turnover.
On the digital marketing front, ASOS displays a nimble paid search strategy. ASOS introduced activewear on its site this February, featuring products from brands like Nike, Adidas, and Puma along with its own private label, ASOS 4505. To promote its new assortment, ASOS reallocated spend so that nearly a third of its Shopping ads drive to Reebok, Puma, New Balance, and Adidas activewear products in 2018, but ultimately, ASOS’s paid search strategy and site merchandising award outsize visibility to its ASOS 4505 activewear line.
By bidding across a variety of activewear brand terms, ASOS drives traffic via Shopping ads to its activewear category pages. There, ASOS 4505 products comprise nearly a third of first-page products across running, yoga, and gym training category pages. The brand completes the bait and switch with look-alike product merchandising: product SKUs across different activewear brands have standardized product photography, enticing consumers toward lower-priced, private-label products. While the average activewear product on ASOS is £49, the average ASOS 4505 product is only £28.