New York – Madewell is topping its parent’s company – J.Crew Group – growth, adding to the investors’ appeal regarding its recently announced IPO.
Madewell derived 40 percent of sales from e-commerce channels in the first six months of this year and had a brick-and-mortar footprint of just 132 locations as of August, the company said in its S-1 prospectus.
According to exclusive new data from web analytics firm SimilarWeb cited by Yahoo Finance, in the first eight months of 2019, U.S. web traffic to Madewell.com surged by 30.2 percent over the comparable period last year, and by 90.3 percent over the same period in 2017, totaling 3.89 million total views. Digital sales represented about 36 percent of the company’s total revenue in the first half of the current fiscal year.
“You don’t really see a lot of retailers at this size grow at this rate,” SimilarWeb analyst Ilana Marks told Yahoo Finance of Madewell’s results. “Sometimes we’ll see a site that maybe just launched or is on the smaller side and it grows by 100 percent, but that’s increasing from 100,000 to 200,000.” “This type of volume and this type of growth is significant,” she highlighted.
And while the absolute number of visits came in short of J. Crew’s 9.23 million over the same period this year, J. Crew’s web traffic growth rate clocked in at just 6.4 percent. Indeed, Madewell’s web traffic growth also surpassed that of peer retailers. Anthropologie.com – the next closest competitor by web traffic to Madewell, based on SimilarWeb’s analysis – saw traffic grow 18.2 percent in the eight months ending in August. Urbanoutfitters.com’s traffic increased by 7.5 percent, and Freepeople.com decreased by 6.1 percent during that period this year. Each of these brands is owned by parent-company URBN (URBN).
Rising menswear and denim sales add to Madewell’s IPO’s appeal
As women start buying up denim again, the timing may be opportune for Madewell, which sees its jeans as a competitive advantage, reports ‘Quartz’. In fact, jeans made up 29 percent of Madewell’s sales last year, according to its IPO filing, and remain among its fastest-growing categories of products.
“We intend to grow our business by, among other things, increasing brand awareness and the size and value of our active customer base, growing e-commerce penetration, expanding our store network and product categories and growing our wholesale business, both domestically and internationally,” the company’s pre-IPO filing said.
In this regard, it’s worth recalling that a little over a year ago, Madewell launched a small men’s collection made up of just a few pieces and sold online, in some Nordstrom stores and later in shop-in-shops within a few of its women’s stores. Now, the company is ready to fully take the plunge into the men’s category.
“In the first year, we’ve gotten a lot of great feedback from male customers on the way things fit, what they like and what they want to see more of,” said Joyce Lee, Madewell’s head of design. “Now that we are a year in, we have great information on sales and what’s resonating, which we can use to evolve the line.”
Lee said that before the men’s line launched, Madewell spent a few years researching and determining what a potential customer of Madewell men’s would want. They started with denim, seen as the core of the Madewell brand, and a few key staple pieces. This was driven in part by data the company collected showing that men tend to be much more loyal customers, finding a particular staple product they like and buying it again and again.
Madewell expects to open 10 to 15 stores a year. Meanwhile, it wants to drive “outsize growth in e-commerce,” according to its filling.
Photo: Madewell Facebook