Urban Outfitters’ focus turns to online-offline integration

March 8, 2016 02:11 PM

Direct-to-consumer sales, which are primarily online sales, continue to outperform store sales at Urban Outfitters Inc., but CEO Richard Hayne told investors:  “The death of the retail store has been greatly exaggerated.”

A key growth initiative for Urban Outfitters Inc., which includes the Urban Outfitters, Anthropologie and Free People brands, is bridging bricks-and-mortar with online, Hayne said Monday on the retailer’s fourth quarter earnings call. This year, the retailer plans to launch website features that include in-store pickup, ship-from-store and enhanced mobile capabilities, he said.

“In order to drive additional direct and omnichannel sales, we will continue to make investments in technology, marketing and new infrastructure,” Hayne said, according to a transcript from SeekingAlpha. “We are improving our functionality around checkout, payments, search, inventory visibility and speed on all of our brands’ web platforms.”

Urban Outfitters, No. 49 in the Internet Retailer 2015 Top 500 Guide, said its direct-to-consumer business had double-digit growth in the fourth quarter of fiscal 2016 that ended Jan. 31. The retailer did not break out online sales figures but said increases in web sessions and conversions drove the growth and offset a decrease in average order value.

On the call, Hayne announced the promotion of Trish Donnelly as CEO of the Urban Outfitters brand segment. Prior to this role, she was North American president of the Urban Outfitters brand for two years. Donnelly replaces Ted Marlow, who retired in August. 

For the fiscal fourth quarter ended Jan. 31, Urban Outfitters Inc. reports:

  • Revenue of $1.013 billion, up 0.2% from $1.011 billion in the same period in 2014. Foreign currency exchange rates negatively affected sales growth by approximately 160 basis points in the quarter.
  • Net income of $72.9 million, down 9.2% from $80.3 million.

For the fiscal year ended Jan. 31, Urban Outfitters reports:

  • Revenue of $3.45 billion, up 3.9% from $3.32 billion a year ago.
  • Net income of $224.5 million, down 3.4% from $232.4 million. 



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