New Look sales slip as shoppers seek out lower-cost alternatives

NEW Look has blamed another quarterly fall in sales and profits on not having the right products and shunning promotions, resulting in shoppers hunting for cut-price items elsewhere.

The high street fashion chain recorded a 4.4pc slip in sales to £338.7m during its first quarter to June 24 as like-for-like sales, which measure stores open more than a year, fell 7.5pc.

New Look’s website sales were 0.6pc lower during the quarter, despite sales on third-party sites such as Asos and Amazon rising by 15.7pc.

Anders Kristiansen, the firm’s chief executive, admitted that it was a “disappointing quarter of trading” and said that “product could be better”. New Look had taken the decision to run fewer discounts in store and online, which “meant less sales online and less traffic, but it has been a conscious decision”. Mr Kristiansen said that New Look’s website was more profitable than that of its pure-play rivals, such as Asos and Boohoo.

To respond to its online rivals’ rampant growth, New Look has spent £2m more on marketing this year compared to last as it recruits social media influencers and bloggers to boost its presence with young shoppers. The business has also taken a £60m to £70m hit on foreign exchange costs compared to last year as a result of the weaker pound, the New Look boss revealed.

Losses after tax swelled to £15.2m compared to a £5.8m profit last year. In an effort to improve its product appeal to shoppers New Look has recently reshuffled its design teams. Christopher Englinde, the retailer’s menswear boss, and Amanda Wain, its footwear director, left the business in June.

New Look has also recruited former Zara Basic head of product Paula Dumont Lopez as its new chief creative officer, succeeding Roger Wightman.

The high street retailer poached Mango womenswear director Rosa Gutierrez Sanchez to bolster its buying, merchandising and design departments.

“It’s all about delivering the product that the customer wants, to make it more fashion forward, attractive and wearable,” Mr Kristiansen said.

“With the product not hitting the mark, the arrival of Paula Dumont Lopez in September is much needed, with the hope of reigniting the retailer’s trend authority and bolstering its relevance in the market,” commented Kate Ormrod, the senior retail analyst at Global Data.