After a dismal year both online and off, clothing and accessories retailer Lands’ End Inc. needs answers to fix problems. And the company is focusing on getting the answers it needs from its business and consumer customers.
Lands’ End ecommerce sales
For the 2022 fiscal year ended Jan. 27, 2023, Lands’ End reported that global ecommerce net revenue decreased 10.1% to $1.1 billion. Meanwhile, the company’s U.S. ecommerce decreased 7.0% and international ecommerce decreased 24.6%.
Land’s End did not break out B2B ecommerce sales. But the company said its Outfitters business, which supplies uniforms and other apparel for companies and schools, reported a 4.6% increase in net revenue to $265.9 million. It attributed the increase to strength in travel-related national accounts and “school uniform customers returning to historical purchasing patterns.” Lands’ End sells uniforms, personalized apparel and promotional products online through its Lands’ End Business ecommerce site.
The drop in overall fiscal year 2022 Lands’ End ecommerce sales was “primarily driven by lower consumer demand as a result of delayed receipts of key products caused by the global supply chain challenges in the first half of fiscal 2022, macroeconomic challenges impacting consumer discretionary spending and industry-wide promotional activity,” Lands’ End says.
Net revenue declines in fiscal ’22
Overall net revenue decreased 5.0% to $1.56 billion compared to $1.64 billion in the prior year. Net loss was $12.5 million compared to net income of $33.4 million in fiscal 2021.
“Over 90% of our revenue comes from a click,” CEO Andrew McLean told analysts on the company’s year-end earnings call. “So, we will continue to emphasize digital channels for serving existing and new customers. At Lands’ End, we’re customer-obsessed. The key to executing this product strategy is making sure we reach our customers in the right cadence with the right products at the right time, helping them to build their basket across categories.”
The key to restoring ecommerce growth is digging deeper into consumer and business buyer behavior and delivering a better online user experience, McLean said.
“We’re going to take a page from our history and focus on engaging directly with our customers while encouraging them to shop across the preferred channel,” McLean told analysts. “Lands’ End already has a robust buyer file, nearly 7 million strong. And we are going to double down on our approach to understanding our customers, both current and potential, and seek to grow our share of our addressable market by leveraging our proprietary data.”
Fiscal Q4 earnings summary
For the fourth quarter, net revenue decreased 4.6% to $529.6 million, down from $555.4 million a year earlier. The overall drop includes a 2.1% decrease in net Outfitters revenue to $60.5 million. Meanwhile, Lands’ End ecommerce net revenue was $414.5 million, down 6.1% from $441.5 million in the fourth quarter of fiscal 2021.
“We’re confident that through our enhanced use of data and analytics, our teams will be better able to predict and manage appropriate inventory levels, reducing that expense without impacting the customer experience,” says chief financial officer Bernie McCracken.
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