A stronger Nelly
Q4 2021 – Significant events
2021 – Significant events
Q4 2021 – Financial highlights
January–December 2021 The period in brief
Higher growth in core business
During the quarter Nelly’s core business, DTC in the Nordics, grew by 9%, with a growing share of Nelly’s own brands.
Our customers seek fashion and lifestyle inspiration for all occasions from Nelly. In recent years, we have developed our range to improve our ability to meet this need for both party and everyday fashion. We are also gradually adding other products to our range, so that our customers can feel fab every day.
We are building a platform for growth
The commitment our growing community generates every day makes Nelly unique. We are gradually improving our range to enhance the brand that our 1.2 million customers deserve. Our committed base of customers and followers gives us the potential and the opportunity for future growth with a focus on a higher frequency of purchasing.
During the quarter, the numbers of followers of our own channels grew, in part because we developed our community via TikTok and more interactive content. Our organic traffic grew during the quarter, primarily driven by sales through our app. Live shopping initiatives also helped boost sales and engagement. In November, we launched our Nelly Lounge customer community, which attracted highly committed members and in which we now also have a secondhand channel for members to buy, sell and exchange Nelly products from, to and with each other. We are delivering on our sustainability targets and realising many of the initiatives demanded by our customers.
For the second quarter in a row, the number of customers increased, primarily in Sweden and Norway. Overall, we are growing in our core market of our own channels in the Nordics. Outside the Nordics, B2B sales are falling, primarily because Zalando is reducing its purchases as it repositions its volumes towards a marketplace model that we, so far, have chosen not to transition to.
The right platform for profitable growth
During the year, we implemented a major relaunch, creating a platform for profitable growth.
The first part involved creating a new operating platform with a new automated warehouse. This was completed successfully. We are beginning to see results in the form of lower warehouse expenses and are now making adjustments to the warehouse to achieve our target of SEK 35 million in annual savings, and are developing the ‘last mile’ and returns processes. The aim is to create an appreciated delivery experience for our customer and we have already reduced our environmental impact and created capacity for growth.
The second part involved restructuring our operations. During the year, about 150 employees left Nelly and we hired nearly 100 new employees, introduced a new organisation, built up new departments for sales, marketing and data analysis, closed two offices and centralised the organisation in Borås.
The third part involved starting to reposition the Nelly brand with a clear focus on customer engagement and a higher frequency of purchasing. We now have an assortment strategy, marketing channel development plan and data-driven analysis in place to deliver on our targets, with additional activities planned for 2022.
We are now shifting from focusing on internal processes to giving our customers all the attention and have the platform, capacity and position to boost sales to our customers with a wider offering of both everyday and party fashion. Both we and our beloved Nelly community are now longing for a year of parties, joy and ‘fabness’, every day!
Webcast on the interim report
Analysts, investors and the media are invited to a webcast presentation of Q4 on 4 February at 10 a.m. The presentation will be delivered in English by CEO Kristina Lukes and CFO John Afzelius. The webcast will be made available on the Nelly Group website.
Webcast:
https://financialhearings.com/event/43232
Conference call:
SE: +46 8 505 58 351
UK: +44 333 300 92 61
US: +1 646 722 49 56
The presentation material and the webcast will be available at:
www.nellygroup.com/en/investors/presentations/
