Jewellery giant Pandora has announced that it will not permanently shut down any of its thousands of stores in response to the economic downturn caused by the Covid-19 pandemic. The CEO, Alexander Lacik, revealed in an interview that despite a significant drop in sales, the company has managed to keep its stores open without resorting to closures. During the peak of the pandemic, 80% of Pandora’s 2,700 stores were temporarily closed, but the company continued to pay its employees, including the 28,000 who were unable to work.

At present, approximately 18% of Pandora stores are closed due to the second wave of Covid-19 in Europe. This closure is expected to impact sales during the crucial Christmas shopping season. Nevertheless, the company is moving forward with its festive marketing campaign and is currently advertising on TV. In regions where physical stores are closed, Pandora’s TV ads will direct customers to its online store. Online sales have seen significant growth this year, with a 89% increase in the third quarter, accounting for 21% of the company’s total sales.

Lacik emphasizes the importance of physical retail in the industry, as customers still value a seamless shopping experience, whether in-person or online. He highlights the profitability of Pandora’s physical stores, which have been revamped to enhance the in-store experience. Interestingly, the company has noticed a decline in online sales in areas where physical stores have been closed, leading Lacik to believe that a combination of physical and online retail is the best approach for now.

The interview with Lacik comes after Pandora’s announcement of its third-quarter results, which showed a 2% overall sales decrease. Although this was an improvement from the 20% decline in the first nine months of the year, sales still dropped by 5% organically in the third quarter. Despite the challenges posed by Covid-19, five out of seven key markets for Pandora experienced positive growth in sell-out. The company attributes this to the success of its Programme NOW initiatives, which have increased traffic and engagement with the brand. Moreover, a new global merchandising structure and best-practice sharing have contributed to a significant improvement in conversion rates, both online and offline.

However, due to the ongoing store closures and uncertainty surrounding the pandemic, Pandora has been unable to provide updated guidance. The company reported a positive 8% sales growth in October, aligning with the trends observed in the second half of the third quarter. As the holiday season approaches, Pandora remains focused on navigating the challenges and leveraging its strong brand reputation to drive sales and engagement.

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