The UK has been a market of focus for jewellery giant Pandora, with Q2 results showing improvement on a weak Q1.
The UK and Italy both received a marketing boost from the brand, which resulted in 2% organic growth in the UK market during the second quarter.
While like-for-like sales were minus 8% compared to the previous year, like-for-like sales in Q2 were an improvement on Q1 2019. Pandora says this was delivered due to a strong May and June, driven by its increased marketing spend in the region.
The brand says: “Testing of increased marketing investments in Italy and the UK have shown a positive effect on traffic and an ability to drive profitable revenue growth. Consequently, it has been decided to significantly increase marketing investments for the rest of 2019.”
Next up for the UK the brand will be opening of a new store look, which aims to completely transform the customer experience.
On the whole, results were still weak for Pandora in Q2, something the brand describes as “expected” and says was impacted by the commercial reset initiated as part of Programme NOW.
Organic growth across the board was -7% and total like-for-like sales-out growth (like-for-like) was -10% in Q2 2019 driven by decreasing traffic into the physical stores. Like-for-like in online stores, however, accelerated to 22%.
Pandora seems confident in it turnaround programme, and says “early positive signs of the impact from Programme NOW is visible in the underlying gross margin, cost levels and cash generation.”
During Q2 2019, Pandora progressed rapidly with the preparations of the brand relaunch which is due to take place on August 29.
The brand relaunch will be kick-started by a global PR event in Los Angeles on August 28 evolving around the new brand purpose, “We give a voice to people’s loves – Passions, People & Places”. Following extensive consumer research, the new purpose is taking focus back to Pandora’s core proposition of co-creation, self-expression and collecting. The new brand relaunch will refresh all consumer touchpoints to increase brand relevance. One of the cornerstones is a new store design that builds on discovery and collecting supported by new collaborations, celebrity endorsements, new products and the largest marketing boost in the company’s history. Pandora will also launch new online stores and refresh its presence on marketplaces such as Tmall.
President and CEO of Pandora, Alexander Lacik, says: “Financial results in the second quarter of 2019 were in line with plans. In the quarter, we have progressed rapidly on a number of important commercial initiatives which we can soon reveal and showcase to our consumers as part of our brand relaunch on August 29. Our preparations and marketing pilots spur confidence in our direction – by improving execution with focus on Pandora’s core proposition, we can improve our relevance for consumers around the world. This is the first important step in our journey towards positive growth.”