Footwear retailer Clarks has appointed management consultants McKinsey & Co to conduct a review of the business after challenging years in the UK market.
Clarks saw UK and ROI sales fall by £37.6m to £561.1m for the year ending 2 February 2019, while tough trading conditions led a loss after tax of £82.9m for the year, more than double its loss from 2018 of £31.3m.
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After the appointment of new CEO Giorgio Presca in March this year to lead the work to transform the Clarks brand, data and analytics company GlobalData said he will need to focus on enhancing Clarks’ use of online marketing through social media to target new customers.
The retailer has a five-year store rationalisation plan in place, including three key actions to stabilise the company: reducing the cost base, arresting decline and bringing profitability to 2019/20. The company will make structural changes to reset the business and build foundations for the future. It is also looking to expand its business in the Asia Pacific region and US wholesale, while decreasing coverage of retail in the US, Europe and the UK.
A spokesperson for Clarks said: “The last few years have been challenging, but despite that Clarks is on track to grow underlying profitability this year. As part of this work, Clarks has appointed McKinsey & Company to support the strategy of renewing the relevance of our brand to consumers and our partners.
“At this stage, we are unable to share any specific details of this strategy; however we can confirm that we are transforming the brand to reconnect with our consumers by designing iconic new products and launching an exciting new brand and marketing strategy that is already engaging consumers across the world.
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By GlobalData“Clarks is one of the few brands in the world with authenticity, a place in fashion history and a cult followership that sets us apart from other brands. Our new strategy will allow the business to capitalise on the momentum that our Clarks Originals products such as the Desert Boot and Wallabee are experiencing, and to meet our ambition of returning the business to sustainable levels of growth and profitability by 2023.”
