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wayfairFurniture and home goods retailer Wayfair is ramping up UK advertising spend as it looks to build on its prior investment in job creation here and across Europe.


The ecommerce retailer, headquartered in Boston in the US, said building its business in the UK, Germany and Canada is a priority for 2016.


It employs 450 staff in Europe, 12 per cent of its total headcount, while international sales represents only 5 per cent of its circa $2.25bn total.


On the firm’s Q4 analysts call, CEO Niraj Shah said: “We believe these markets represent a tremendous opportunity for us. Western Europe has a total addressable market size similar to that of the US of nearly $250bn.”


Mr Shah said that Wayfair had proven that its model works in the US, adding that “Some of our earlier stage international markets like the UK are showing the same strength and we're excited to fully go execute our model.”


He said: “We think of our UK and Germany businesses as similar to our US business in 2013. As with the US, before turning up the dial in marketing, we worked to establish our European supplier base and our core operations infrastructure in Europe. Over the past year, we have invested heavily in building out our team.”


He added that late 2015 saw Wayfair start implementing its US advertising playbook with a particular focus on the UK.


“Results in the market are very promising. Year to date in 2016, the UK business is growing at a multiple of the US growth rate. Over the course of this year, we plan to significantly ramp both advertising spend and the continued buildout of our team in Europe.

Wayfair grew sales by 70.6 per cent to $2.25bn in 2015, narrowing its adjusted EBITDA deficit to $15.9m from $62.5m year-on-year. The retailer was free cash flow positive for the year, with $72.9m of free cash flow, with about $466m cash and equivalents on its balance sheet at the 31st December 2015 balance sheet date.


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Quotes: Seeking Alpha