ts it will see gross sales of approximately $270 million for the full FY22 – a 24 per cent increase year on year – and revenue growth of 69 per cent to $64 million.
The online business’ goal is to hit $500 million in gross sales, as well as positive earnings, by FY25. It’s the first step on chief executive Sean Senvirtne’s mission to hit $1 billion in sales.
As it stands, MyDeal makes up about 3 per cent of the of the $8.1 billion online household goods market, which sits within the $67 billion Australian household goods market.
Senvirtne told Inside Retail that the business’ growth was no longer tied to the online boom seen by many retailers throughout the pandemic. MyDeal’s growth is now it’s own.
“We believe MyDeal has been a big beneficiary of the [current market], but when we look at our sales growing 40 per cent in January, almost 30 per cent in February, while our marketing spend is decreasing – it’s definitely no longer the pandemic driving our growth,” Senvirtne said.
“It’s MyDeal acquiring market share in the current market, and we’re quite comfortable with where we sit in the market right now.”
Senvirtne also added that he felt quite comfortable giving out sales guidance and a business outlook at a time when many businesses are simply declining due to the pandemic continuing to change customer behaviour.
Part of this comes from the initiatives MyDeal has in the works for the next several months which they expect to drive a strong level of growth, namely: the maturation of the business’ mobile app, and the expansion of its private label homewares offering.
Private label
My Deal is also planning to add two new private label offerings: homewares brand Kubo and storage solution brand Nelio. This will sit alongside the existing bedding brand Esplanade Home and furniture brands Duke Living and Ergoduke.
“These products will set us up to enjoy gross margins of over 30 per cent,” Senvirtne said.
“At the moment, our private label brands sit at around 11-12 per cent of our total sales, but we have plans to get them to around 20 per cent. We’ve already been able to grow the business quickly, and we see some amazing things happening in our private label range moving forward.”
That’s not to say MyDeal expects to be immune to the changing retail landscape. But the issues it sees ahead – changing customer behaviour, shipping delays, and any other problem that arises as Australia continues to recover from the Covid-19 pandemic – will be faced by the entire industry, not MyDeal alone.
And, with MyDeal moving its investment focus off of the business’ capabilities and into its customer experience, it expects it can continue to see the same strong growth it saw in the last six months.
A focus on mobile
The majority of MyDeal’s customers shop on mobile, but only 11.6 per cent of them shop using the business’ mobile app. This signals an opportunity to Senvirtne, who said that mobile app users tend to be significantly more engaged than a regular mobile user, and spend more with the business.
“The mobile app is definitely the way of the future for e-commerce in general,” Senvirtne said.
“When we first started, it was important to us that we got our marketplace infrastructure right, but now we can focus on getting our customer focus right.”
MyDeal launched its mobile app about nine months ago, and currently has a total download number of around 400,000. But the goal is to get to 1 million downloads, which is expected to happen in the next six to nine months.
Part of this will be through the rollout of a new loyalty program, which will aim to bring people to the mobile app and reward them for remaining on it.
