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Bloomberg
Boohoo Group Plc lifted its full-year growth forecast after the online apparel seller’s Instagram-fuelled marketing strategy paid off over the holidays, offering a measure of relief to an embattled UK retail sector.
The group lifted its growth forecast for the year to a range of 43 percent to 45 percent from a previous 38 percent to 43 percent after Christmas sales gains were led by popular brands PrettyLittleThing and Nasty Gal.
Boohoo’s performance allayed some concerns that the crisis in UK retail was spreading to online shopping, after a pre-Christmas profit warning from rival Asos Plc and a series of bricks-and-mortar collapses.
Some investors were expecting an even more buoyant update, however. After a roughly 30 percent rally since late December, and the shares were down 2 percent in London on Tuesday after early gains.
“Boohoo has bucked the trend of a difficult Christmas for many clothing retailers,†Jefferies analysts led by Caroline Gulliver wrote in a note.
Boohoo’s marketing strategy harnesses Instagram, where its brand ambassadors include Kourtney Kardashian and participants on a reality TV show.
Stars pose in the company’s leopard-print dresses and neon-coloured garments, persuading young customers to click through to its websites and fill their virtual shopping baskets.
Boohoo is expanding beyond its core UK market and achieved 78 percent growth in the US in the latest four months. In its sales update, the company pointed to “significant†global opportunities.
Former Primark Stores Ltd. executive John Lyttle, who’s set to become Boohoo’s new chief executive officer in March, will oversee the next phase of expansion.