Following today’s release of Moonpig’s figures for the six months ending 31st October 2023; Zoe Mills, lead retail analyst at GlobalData, a leading data and analytics company, offers her view: “Moonpig’s investment in enhancing its online platform has paid off, with the greeting cards & gifting specialist reporting a strong H1 FY2023/24 performance despite a challenging economic climate. Total revenue grew 6.5% for the period to reach £152.1m. While this was driven predominantly by its acquisitions within the experience gifting sphere, which was completed in July 2022, on a pro forma basis, revenues were still up 2.1% despite a weaker online market in 2023 and a decline in total orders amid the cost-of-living crisis.
“The online specialist’s greeting cards range was the main propeller of growth in the period, with card revenues up 5.7%. This was driven by inflation in the category, with both card and postage prices having risen, boosting average order values through Moonpig and Greetz by 7.1%. Furthermore, this achievement was supported by Moonpig’s strong customer retention with 91% of revenues for the period via existing customers. This is a clear indicator of its ability to maintain appeal among shoppers and encourage repeat purchases through tools such as event reminders and its subscription service Moonpig Plus.
“Moonpig stated that it maintained a disciplined approach to the cost of new customer acquisition. While brand recognition is high for the retailer thanks to its strong marketing campaigns in the past, the ease and lower cost of picking up a card instore means it must continue to highlight the benefits of shopping through its website, including personalisation, direct to recipient postage and new options such as digital cards.
“In comparison, pro forma gifting revenues were down on H1 FY2022/23 as both attached and standalone gifting through Moonpig and Greetz declined. However, given a landscape of fewer orders during the period (down 5.1%), the more marginal decline of 1.9% in attached gifting revenue showcases Moonpig’s successful strategy to grow basket sizes and encourage shoppers to add on gifts before checkout via prompts during the buying process. The expansion of Moonpig’s experience gifting proposition, with the acquisition of Red Letter Days and Buyagift in 2022, should also prove beneficial for its profitability in the long run. Adjusted EBITDA rose 19.9% to £41.4m, and is now ahead of H1 FY2019/20 levels where profits had initially peaked post-IPO.”
