Currys says most of its customers now use its stores and its website when they buy technology and electronics. Some 60% of its UK customers used both channels to buy in the first half of its financial year – and Currys says that has meant the retailer is never out of stock, that customers can get goods when they want them, with face-to-face advice always available, either online, via its ShopLive video shopping service, or in-store.
The retailer has now completed its move to one Currys brand in the UK market – and to a single brand in its other markets – and says the simplification has helped boost name recognition, with three quarter of traffic to its Currys.co.uk website now from free or direct sources, while search spending on pay-per-click has fallen by 23% year-on-year. The then-Currys PC World was ranked a Top50 retailer in RXUK Top500 research at the beginning of this year.
The update came as Currys this week reports total revenue of £4.8bn in the six months to October 30. That’s 2% down on the same time last year. Some 24% of sales took place online, following growth of 9% on last year – and 59% on two years ago. Year-on-year UK and Ireland sales fell 4% in total to £2.5bn, and 3% on a like-for-like basis that strips out the effect of store and business openings and closures. They were 9% lower than two years ago.
Pre-tax profits of £48m were 6.7% higher than the £45m reported at the same time last year.
Currys group chief executive Alex Baldock says the “simpler, more focused business” that has been achieved through a well-advanced omnichannel transformation programme is now best placed to make the most of the growing importance of technology in people’s lives.
“Above all, we’re showing that in technology retail omnichannel wins,” he says. “Yes, more customers are shopping online, and our hard work to build a strong online business has seen us thrive here. But most customers buy tech through both online and stores, our sweet spot, where we’ve worked hard to build on our strengths. That’s paying off.”
However, he said that spending had been softer in recent weeks, adding that “we may face into further headwinds from omicron and associated restrictions, but the stronger business we’ve built can ride out both the industry-wide disruption to supply chains and bumpy demand. After the strong first half, we remain on track to meet the expectations we set out a month ago for full year adjusted PBT of around £160m.
“We owe all this to our tens of thousands of capable and committed colleagues, 16,000 of whom will receive £1,000 of free shares in February, as we continue to make all colleagues shareholders. It’s their skill and will that’s keeping us on track for another successful year, and that’s transforming Currys into a business to be proud of.”
Currys rolled out new omnichannel platforms including its new currys.co.uk website during the year, with a focus on design, personalisation and easier navigation.
At the same time, the company is now offering services from face-to-face advice to fast fulfilment both online and in its stores. Its online ShopLive service offering advice has seen higher levels of satisfaction, conversion and average order values than unassisted online shopping, while 18% of online sales are no collected from a store via the Order & Collect service, with more than half of sales picked up on the same day.
Supply chain challenges
The retailer says it has seen challenging conditions in its supply chain, with shortages of high demand tech products as manufacturing has been limited by the Covid-19 pandemic, and a shortage of HGV and 7.5 tonne van drivers and warehouse staff. There have also been “Brexit-related teething problems with getting stock into our Irish business.”
Currys has worked closely with suppliers to boost stock availability, and recruited by increasing base pay and adding sign-on and retention bonuses. In-store staff have also moved into its supply chain, while three of its distribution centres are now operated by logistics company GXO. Currys says customer satisfaction ratings have improved despite the challenges, with net promoter scores (NPS) up by almost five points in the UK market on two years ago. “Pleasingly,” says Baldock in the half-year statement, “satisfaction measured at almost all parts of the customer journey was up materially compared to last year. However, there is still a lot of work to go in this area and a lot of our energy will continue to go into fixing customer pain points.”
Currys has won an A score from CDP for its sustainability work – making it one of only 14 companies in the UK to gain this. It says it wants to be famous for giving technology a longer life through trade-in, protection, repair and recycling. “For Currys, purpose and profit go hand in hand as they must if both are to be sustained,” says Baldock. During the first half of the year it accepted in trade-in goods with a 40% higher value than two years ago, and collected 53,000 tonnes of waste electrical and electronic equipment, including 642,000 items from customers’ homes.
Currys is a Top50 retailer in RXUK Top500 research.