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Temple & Webster flags marketing strategy shift, tech innovation in full-year financials

Company CEO and co-founder, Mark Coulter, made the comments as the ASX-listed furniture and homewares retailer announced its full-year financial results to 30 June 2018, edging closer to profitability two years after promising investors it would do so. Temple & Webster reported FY18 revenue of $72.6 million with a net loss after tax of $21,000. Gross margins improved by 1.5 per cent to 44.2 per cent, while second-half revenues were up 25 per cent year-on-year, resulting in an EBITDA of $300,000. Key to delivering these results were resetting the cost base, improving gross margins and shipping costs, reducing first-first customer acquisition and offshoring customer care and support staff, the company stated. Highlights included an improvement in advertising costs as a percentage of sales (from 11.2 per cent to 12.7 per cent), as well as a drop in the cost per first-time customer from $58 to $54 in second-half compared to first-half. Growth was reflected across both B2C and B2B customer groups. Coulter also noted work to improve merchandising resulted in a 20 per cent increase in conversion rates year-on-year. “Importantly, we achieved our break-even milestone through strong growth in both active customers and revenue in the second half,” Coulter said, adding first-time customers are profitable during their first year with the group. “This means that we can now begin to accelerate marketing spend beyond digital channels to ensure more of Australia is aware of Temple & Webster,” he said. It is unclear who is leading the marketing efforts, however, with former CMO, Sven Lindell, leaving the group in June after a two-year stint.   The retailer reported active customers of about 198,000, with 1.1 million website users per month.

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