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IREU Top500 The Customer Report: 2018

IREU Top500 The Customer Report: 2018

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House of Fraser: a new dawn

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It’s been a tough few years for the long-established department store, which was bought by Chinese investment group Sanpower in 2014, but its plans for a state-of-the-art store that will combine a destination experience with multichannel retail, together with a £25m upgrade of the company’s ecommerce platform, sets out a bold vision for its future.

House of Fraser’s massive investment in upgrading its digital platform – work on which began in April 2017 – will provide the capacity to double its online sales while also improving its online profit margin. The company’s yearly results to January 28 2017 showed that online sales grew by 16.1% on the previous year, with online now accounting for 21.8% of its total sales. The company’s pre-tax profits for the year were £3.4m.

The retailer is in the process of designing a new 100,000 square-foot store for the Northgate city-centre development in Chester, where it will be the anchor tenant. According to executive chairman Frank Slevin, the store, which is due to open in 2021, will take HoF into its next phase of development focusing on customer experience, and integrating online and store shopping. It will be, said Slevin, a “multichannel, modern, experience-led retail offering”, and is likely to include the widespread use of digital technology for ordering and collection.

Multichannel development and international expansion were put at the heart of the company’s strategy when the Sanpower Group took control. House of Fraser opened its first Chinese store in Nanjing in December 2016, but plans to open two further Chinese stores have been put back due to difficulties getting the Nanjing store up and running. Abu Dhabi is currently home to the only other brick-and-mortar store outside the UK, but international customers can shop on House of Fraser’s UK website. The company recently launched its first overseas website for customers in Australia, its biggest-spending overseas market.

Back at home, it has invested in smaller HouseofFraser.com stores where customers can browse the full HoF range online and collect orders, a concept also rolled out on some floors of its bigger stores. It has also trialled virtual queuing and last year signed up digital transformation agency TH_NK to help it envisage what the store of the future might look like.

All of this represents a positive change of fortunes for the store which returned to profit for the first time in a decade in the year ending January 2016. Its pre-tax profits were £1.3m compared to a loss of £2.9m for the year ending January 2015.
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