50 Shades put customers in a ‘different gear’, says Gold

THE success of erotic novel 50 Shades of Grey has helped Ann Summers negotiate the recession, says chief executive Jacqueline Gold.

Speaking to TheBusinessDesk.com yesterday she said the bestseller by EL James had “totally changed people’s thinking”.

Ms Gold was the keynote speaker at a retail-themed corporate insolvency and recovery conference hosted by law firm JMW in Manchester.

She said: “The book has put people’s thinking into a different gear. It’s not so much about that one book, but the genre, it’s fashionable now to read erotic literature. It’s inspiring women and giving them ideas and empowering them in the bedroom.

“But I don’t give all the credit to 50 Shades. We’ve also done things to our brand – we invested in research at the start of the recession and we’ve got a new store concept. When we opened it in Colchester sales were up 115% on the first day.”

In the year to June the group, which is owned by Ms Gold, her sister Vanessa and her father David – who also owns West Ham United, made a profit of £3m on sales of around £150m.

It has a network of 145 shops which accounted for 60% of sales. The Ann Summers party arm contributes around 20%, while internet and mail order sales represent 15%.

“It’s obviously challenging times and there are many companies out there that aren’t making any profit,” said Ms Gold. “But this financial year I would be shocked if we didn’t double last year’s profit figure, and that would be a conservative estimate.”

Some 60% of the firm’s revenue is from the sale of lingerie which is now a market worth £1.52bn in the UK and said to be recession proof with overall sales up 0.6% over the last four years, while general clothing has been flat. The other big earner for Ann Summers is sex toys which accounts for 30% of income.

When Ms Gold first joined the business in the late 1970s it was a more traditional sex shop owned by her father. Around 10% of visitors were women, but the shop’s repositioning as a High Street brand means some 80% of customers are now women.

But she is wary of an imbalance. The revamped shops have moved away from pink – “we don’t want to alienate men” – and have an “edgier” design.

Commenting on the latest GDP figures, which marked the end of the double dip recession, Ms Gold said: “This is an uncertain period. The problem with recession is even when you come out the recovery takes considerably longer.

“It takes a long time for consumer confidence to return. For me the influence will be more jobs, we need to see more of a trend there, that will help with confidence. We could do with more investment in infrastructure to create jobs and that would send out a more positive message.”