Prosseco Majestic

Prosecco sales at Majestic were up 39% in the first half of the year

Majestic Wine is aiming to grow its online sales to around 15% of its UK business over the next five years, chief executive Steve Lewis has said.

The wine retailer said the key thing was to ensure that online sales were profitable and did not erode in-store sales, as it reported online sales up 8.3% to £13.8m. E-commerce now represents 10.3% of UK sales, with an average spend per customer of £147, while click & collect purchases were up 24%. 

“For many retailers, online sales are eroding bricks and mortar, but by having online orders picked up in store, our online sales don’t erode store sales, and we can leverage the existing property base,” chief executive Steve Lewis told The Grocer today.

Wine doing fine

  • Majestic’s Prosecco sales were up 39% in the first half of the year
  • Argentinian Malbec up 40%
  • Provence rosé up 50%

In July, the retailer “future-proofed” by rolling out an improved online platform with enhanced click & collect capabilities, store-specific stock display, improved navigation and “intelligent” product recommendation.  

Lewis said he was pleased with the “steady progress” made in the group’s four-fold growth strategy, which was divided between growing online sales; pursuing store expansion; building fine-wine sales; and boosting its commercial B2B business, which accounts for around a quarter of its UK sales.

The company is opening its 200th store in November this year, and plans to expand to 330 stores by 2021, an average of 16 stores per year. This organic growth would be funded by the company’s own revenue streams, Lewis said.

Total sales in the six months to 30 September rose 3.3% to £130.2m, with pre-tax profits up 4.2% to £9.5m. 

Fine wines did particularly well Lewis noted, following a revamp of the range to appeal to a wider number of consumers. “We didn’t change the number of wines we sold, but as the store pushed outside London, we felt our offering was too esoteric so wanted a broader appeal in the range,” he said.

The 19% drop in pre-tax profit in the company’s Calais-based business, which caters for UK consumers ordering online or over the phone and collecting in France, was purely a margin fall, Lewis said, due to the level of customers taking up an pre-order incentivisation offer. “Like-for-like was only down 0.6%,” he said.