Urban Outfitters sales increase 7%
Urban Outfitters has recorded a seven per cent increase in sales for the second quarter of 2014.
The fashion retailer, which is continually expanding its presence on the UK high street and owns four other brands, announced a net income of $68 million (£41 million) and $105 million over the first and second quarters of the year respectively.
Total company net sales for the second quarter of the year jumped to $811 million, while comparable retail segment net sales were flat and wholesale segment net sales increased 36 per cent.
Across the three months ending July 31st 2014, the gross profit rate dropped by 200 basis points compared to the previous year. This correlates with the business’ growth across the UK, where three new stores were opened.
What makes Urban Outfitters so successful?
There are many reasons why Urban Outfitters has become successful across the world. Exciting products, friendly customer service and excellent market research have all contributed to its performance and are key factors for the company.
However, the brand’s distinguished identity on the high street is a unique selling point for the chain. All of the stores have a consistent style aimed directly at the company’s target demographic: fashion enthusiasts between the ages of 16-30.
The retro, warehouse-style aesthetic of the shops play a key role in catching the attention of consumers. There are simply no other high street chains that share the same look and vibe, allowing Urban Outfitters to clearly stand out from their rivals.
Many other retailers share a similar appearance, but Urban Outfitters offers subtle nuances that truly make an impact with shoppers. For example, many of the stores have games consoles for visitors to play on - are there any other brands using this tactic to lure in customers? The brand strives to be different and this is not just reflected in the design of the stores.
The appeal of unique products
Once shoppers are in an Urban Outfitters store, they know they can browse items that are hard to find in other fashion retailers.
Vinyl, books, and a range of other quirky products await visitors, offering a variety of stock that is more commonly associated with charity shops.
Another key reason for Urban Outfitters’ success is its connection with their customers. Vinyl has enjoyed a strong resurgence of late, with the format’s sales increasing rapidly. Just a decade ago, vinyl was being written off as a dead medium, but now it is thriving.
The retailer has clearly tapped into this by including vinyl sections in all of its stores, giving consumers an extra reason to visit the store even when they are not interested in buying new clothes.
By creating such an unique atmosphere in its stores, Urban Outfitters is protecting itself from online rivals.
The company seems to understand that consumers want an appealing shopping experience if they are to trade the internet for the high street, which is helping to attract more customers.
How did the other brands fare?
As well as its own brand, Urban Outfitters manages five brands in total: Anthropologie, Free People, Terrain, and BHLDN.
Anthropologie and Free People in particular have enjoyed success in the last quarter, with the latter recording a 21 per cent increase in sales in the retail segment. Anthropologie also performed well, achieving a six per cent rise in the same segment.
Richard A Hayne, chief executive officer of Urban Outfitters, said: “We are pleased to announce record second quarter sales driven by strong performances at our Anthropologie and Free People brands.
“This achievement is a testament to the strength and validity of our model and to the ability of our talented teams to create powerful lifestyle brands, through compelling product, imagery and experiences.”
In the six months ending July 31st 2014, the company launched 14 new stores across its five brands. Free People added seven, Anthropologie increased its total by four and there were three new Urban Outfitters retail units.
With this in mind, it is clear that the Urban Outfitters continuing to grow and, with each of the firm’s brands targeting different audiences, it is likely that more successful figures are to come in the future.