The big fashion chains are clear that turnover in physical stores will fall this year due to the covid crisis, which has forced them both in the first wave and now in this second to close premises for several weeks or restrict capacity . But the health crisis has also had a positive side in the case of Mango: it has triggered online sales.
The most important fashion chain in Catalonia expects to close 2020 with a turnover of 800 million euros through this channel, which represents an increase of 40% compared to 2019. In fact, at the end of October the brand had already billed 5% more in internet sales than in the whole of last year. In the period of strictest confinement (from March 14 to June 1), as explained this Wednesday by the head of the area of e-commerce and member of the management committee, Elena Carasso, Mango managed to increase its online sales by more than 50% compared to last year.
The firm, however, which this year celebrates the 20th anniversary of the launch of the virtual channel, does not yet dare to say what percentage of total turnover will represent this channel at the end of 2020. Among other issues, because there are two months left most important sales with appointments such as Black Friday, Cyber Monday or the Christmas campaign. In 2019 it accounted for 24% of turnover, reaching 564 million euros.
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What the company led by Isak Andic is clear is that it will be “difficult” to reach the “record” results of 2019, in which it closed with a turnover of 2,374 million euros (6% more than in 2018) and a net profit of 21 million euros, so that it managed to reverse three consecutive years of losses. However, the forecasts for 2021 in terms of online sales are even more optimistic than those of 2020: Mango aspires to close next year with the round figure of 1 billion euros.
Despite the inevitable puncture of sales in physical stores, Carasso has made it clear that in no case has the chain planned “mass closure of stores” or layoffs, as other chains have announced such as the Spanish giant Inditex, which provides lower the shutter of between 1,000 and 1,200 locals this year and the next globally. H&M will do the same with 250 establishments. “The policy will remain the same as in recent years: resizing physical stores (gaining square meters),” Carasso detailed.
150 million in investment for the online channel
To continue growing in online sales the company has invested in the last three years 150 million euros in its division of e-commerce. Apart from its reference center, which is located in Palau-solità and Plegamans, the company already has 11 satellite warehouses for this channel located in countries such as Germany, Turkey, Russia, China, Korea, Mexico, Colombia and the United States, among others. Online sales reach 83 markets, a figure slightly lower than the hundred countries where Mango has physical stores.
As for the type of customer who chooses to shop online, in this case he is inclined to more expensive products than those in the store, while those who go in person to the establishments have previously visited the online channel or networks social.