Multichannel, rather than pure ecommerce, is proving the more successful formula for electricals retailer Dixons Retail.
The company, which owns the Dixons, Currys and PC World brands, today said in a full-year trading statement that its ecommerce sales had fallen by a sizeable 9% during the year to April 30, or 5% in like-for-like sales. At the same time, however, it said its multichannel internet sales – transactions that involve both the store and online - had risen by 12%. The company said this demonstrated the ongoing shift to multichannel sales.
In the second half of the year alone, ecommerce sales were down by 11%, or 8% on a like-for-like basis.
The ecommerce division of Dixons Retail includes pureplays Dixons.co.uk and pixmania.co.uk. Multichannel services include reserve and collect at Currys and PC World stores. The company has also launched a new customer services KNOWHOW brand, which includes online buyers’ guides and a delivery and installation service across the retail brands.
However while the multichannel format prospered during the year, it could not compensate for overall falling sales. Dixons Retail said total group sales fell by 2% in the full year, as did like-for-like sales. In the second half of the year, both figures were down by 4%.
It also said pre-tax profits were likely to come in at £85m, in line with previous guidance.
Our view: Time and again multichannel retailers come out as winners in online retailing stakes. It seems shops, not to mention a known, tried and tested brand, really do give an edge to those retailers who sell this way. So it’s not surprising to see Dixons Retail indicate that the multichannel approach is working for it. We do wonder, however, what that means for Dixons.co.uk, which is now a pureplay ecommerce brand without shops. Is this the beginning of the end for a long-standing brand, or will we eventually see a return to the high street for the well-recognised name?