Asos hikes adspend as part of plans to become $9.5 billion business

Asos plans to increase its marketing spend as it sets out "ambitious" plans to become a £7 billion (US$9.5 billion) business within three to four years.

In its full-year results to 31 August, the online fashion retailer recorded sales growth of 22%, with 36% in the UK and 21% in the US. Sales in the EU grew by 15%, while the rest of the world grew 6%.

The brand also grew its active customer base by 13% to 26.4 million, achieving an adjusted profit before tax of £126.3 million, up 30% on the previous year.

It plans to invest marketing spend in international territories—boosting the budget by about 1% of sales. The retailer expects profit of between £110 million and £140 million.

Increased efficiencies will continue to support its increased investment in marketing with capital expenditure expected to remain in the range of £200 million - £250 million.

Meanwhile, chief financial officer Mat Dunn has taken on the additional role of chief operating officer, leading the business on a day-to-day basis, with Nick Beighton having stepped down as chief executive. New chair Ian Dyson is leading the search for a replacement CEO.

Dunn said: "Looking ahead, while our performance in the next 12 months is likely to be constrained by demand volatility and global supply chain and cost pressures, we are confident in our ability to capture the sizeable opportunities ahead. In the last two years, we have transformed Asos with investment in infrastructure and the customer offer. We have generated strong revenue growth and free cash flow and improved structural profitability.

"But we know there is more to do and today we are setting out details of our ambitious plan to significantly increase Asos's sales and profitability, becoming a £7 billion business within three to four years. I am delighted to be taking on the role of COO and will work tirelessly with all 'Asosers' to deliver against our refreshed strategy."

This news follows Asos's launch of a multi-territory ad campaign. Developed by Asos Creative Lab, The Sunshine Company, Byte London and Smuggler Productions, the film depicts style in different contexts and countries. Directed by Ricky Saez, the ad will run across video-on-demand in the UK, France and the US as well as via social channels.

John Mooney, global brand creative director, Asos said: “It’s incredibly exciting to be launching this new advertising. It’s smartly planned, targeted and timed, and the creative embodies Asos's belief that inspiration comes from everywhere, no matter who or where you are, while positioning the brand as a creator, curator and champion of style. The screens have changed, but at our core we’re still about as seen on screen.”