Next boss credits ‘acceleration of marketing efforts’ for growth
The retailer increased digital marketing spend by 56% during the first half, as international growth accelerates.
· Marketing WeekBy Emily Manock 17 Sep 2026 2:17 pm
Next increased digital marketing spend by £39m, a rise of 56%, in the first half of its 2026/27 financial year, as it prioritises growth online, both in the UK and overseas.
The additional spend contributed to higher sales across the period, and while such a large increase could have impacted profitability, the business said it was able to offset the cost of additional digital activity by improving efficiencies in its warehouses and higher gross margins as a result of paying less to suppliers.
Next had lowered its forecast as a result of “overperformance” last year and external headwinds, but after a good summer, Next CEO Lord Simon Wolfson said it had beaten these estimations comfortably, which he attributed in part to an “acceleration of marketing efforts”.
In the UK specifically, the retailer spent £52m on digital marketing during the first half, up 39% from £37m last year. It estimates that marketing contributed 3.8 percentage points of its 7.4% growth in UK online full-price sales, with the remaining 3.6 points coming from underlying growth.
What drove our growth overseas was increased investment in marketing as a result of the better returns we were getting on that expenditure.Lord Wolfson, Next
However, the return on UK marketing investment fell from £2.08 to £1.82 in incremental cash profit for every £1 spent. Next attributed the decline partly to competitor disruption in the previous year, which had flattened returns.
Wolfson stressed Next wasn’t “deciding to spend more because we want to”, but rather because it is “getting the returns on the marketing that are above our hurdle rate [of £1.50].”
Overall, for the six months to the end of July, Next’s total group sales increased 9% to £3.54bn, while statutory revenue rose 9.6% to £3.45bn. Group profit before tax was up 10.5% to £569m, with statutory profit before tax increasing 11.2% to £566m.
Profit after tax rose 10.4% to £427m, while the group’s pre-tax margin increased from 15.8% to 16.1%.
Success overseas
Internationally, the retailer increased direct-to-consumer marketing spend by 63% to £51m. This generated an estimated £1.77 in incremental cash profit for every £1 spent, slightly ahead of the £1.75 return recorded in the previous year.
Europe accounted for £26m of international marketing investment, up 75%, while £15m was spent in the Middle East, up 37%. Next also invested £3m in the US, where its return was £1.48 per £1 spent, below its £1.50 investment threshold, although it said more recent spend was generating returns above that level.
International full-price sales increased 24%, with Next estimating that marketing activity was responsible for 23% of the increase. Direct to consumer sales were supported by improvements to website functionality, delivery services and returns, which the retailer said had helped improve conversion and customer retention.
“What drove our growth overseas was increased investment in marketing as a result of the better returns we were getting on that expenditure,” said Lord Wolfson.
As such, the retailer has increased its expectations in international markets. Next expects to continue increasing marketing investment where returns meet its profitability threshold. International marketing spend is planned to rise 42% year on year in the second half.
Next reaps rewards of 60% rise in international marketing spend
The company has raised its full-year profit before tax guidance by £12m to £1.255bn, while total group sales guidance has increased by £22m to £7.5bn. Full-price sales are expected to increase 6.7% for the year.
The retailer said the profit upgrade reflected both higher sales expectations and additional cost savings, particularly in warehousing. It expects warehouse costs to fall to 6.7% of sales this year, from 6.8% in 2025/26.
This, Wolfson argued, should allow more money to be put into marketing to drive growth for the business, rather than cutting costs for its own sake.