Shares in Sosandar (SOS:AIM) strutted 7.4% higher to 18.8p on Thursday as the online women’s fashion brand announced an exciting deal to sell its womenswear collections on Marks & Spencer’s (MKS) website.
Hard-pressed high street stalwart Marks & Spencer is forging clothing partnerships with carefully chosen third party brands as part of a strategy to turbocharge online growth by giving customers a broader choice of products.
And for online pure-play Sosandar, the tie-up should boost brand awareness across its target market of 35-to-55-year old women who have ‘graduated from throwaway fashion’, whilst hopefully ‘driving incremental sales’ and ‘accelerating improvement’ in its EBITDA losses.
BOOSTING BRAND AWARENESS
Following on from successful online partnerships with John Lewis and Next (NXT), Sosandar has inked a deal to sell a range of products through Marks & Spencer’s online platform as a third-party retailer.
Sosandar and Marks & Spencer have agreed a selected range that will begin selling through the M&S online platform later this month. The initial consignment will include best-selling styles across Sosandar’s denim collections, as well as premium leather products, dresses, knitwear, loungewear, tops, trousers, leggings and accessories.
Further collections will be added on a monthly basis to increase newness and drive repeat visits to the M&S website.
Sosandar’s co-chief executives Julie Lavington and Ali Hall say the partnership is ‘a strong endorsement of the appeal and quality of our clothing and our growing customer base. We have worked closely with M&S to curate a stunning launch collection and we are confident that our products will resonate well with the extensive M&S customer base.’
STRONG SYNERGY
Shore Capital believes there will be ‘strong synergy’ between Sosandar’s customer base and that of Marks & Spencer, with the latter seeking ‘a younger, more family focused shopper. Since the start of the Covid pandemic, M&S has had to act at times as a pure-play retailer and so has become the second biggest online clothing retailer in the UK, according to market data’, adds the broker.
Guided by chief executive Steve Rowe, Marks & Spencer has introduced a number of third-party brands to complement its own clothing ranges including Nobody’s Child and Ghost dresses through the Autumn, and also Early Learning Centre in children’s toys.
‘The establishment of a further clothing partnership with Sosandar is part of Marks & Spencer’s strategy to significantly grow online sales by working with adjacent third parties within its MS2 division, which sits within Clothing & Home (C&H),’ explains Shore Capital.
The broker sees the M&S partnership as ‘another significant milestone in the Sosandar story’, which should allow Sosandar to ‘further increase brand awareness across a relatively similar customer demographic and so help drive incremental sales and position the Sosandar business to become cash generative over time, especially once more normal trading conditions return, and the business continues to scale up.
‘Once consumers start to go “out, out” again, there will be pent-up consumer demand for clothing. We continue to believe that Sosandar remains in the foothills of its potential development and that there remains a significant growth opportunity for the brand.’
