House of Fraser reports 'record' Christmas trading, with Black Friday its best online day ever
A strategy of investment in customers' shopping experience both online and in stores has paid dividends for House of Fraser , its chief executive said today as he reported record Christmas trading figures, including a Black Friday that was 70% ahead of any previous day's trading.
The multichannel department store today reported like-for-like sales up by 8% over the six weeks to January 3. That growth was led by online, with internet sales up by 31.2%, while bricks and mortar store sales rose by 4.2% on a like-for-like basis, stripping out the effect of store openings and closures.
The scale of the emerging Black Friday phenomenon was illustrated by the statistic that sales on that day (November 29) alone, online sales rose by 125% compared to the same time last year. Strikingly, they were almost 70% ahead of all previous online trading days.
John King, chief executive of House of Fraser, said: "This year we saw a very strong start to the key Christmas season with Black Friday being particularly successful. This positive momentum continued over the entire critical selling period with a record sales level during the final week before Christmas. Our performance demonstrates the success of our strategy to continuously improve our online proposition, develop both our House Brands and premium branded proposition and invest in our stores to give our customers the best possible shopping experience."
He confirmed further investment online, in stores and internationally in 2015, with a second store set to open in the Middle East, where it already has a franchise store in Abu Dhabi.
"We will continue to invest in our online proposition and as a result we expect to continue to see sales growth from this channel," said King. "During 2014 we refurbished our store in Bath which has seen sales increase by 27% since the completion of the works and we plan to refurbish more stores during 2015 as well as build on our international portfolio. Given this further investment, we believe that we are well placed to continue to grow in 2015."
House of Fraser said strong sales had continued throughout the period, with sales in the last seven days before Christmas up by a record 6.8%. Like-for-like sales in the first 10 weeks of its fourth quarter were 6.7% up on the same period last year.
Commenting on the figures, Jon Copestake, retail analyst at The Economist Intelligence Unit
, said the figures reflected the Black Friday effect. "The fact that Black Friday was followed by Cyber Monday, Mega Monday, Manic Monday and Panic Saturday meant shoppers were given plenty of opportunity to consume ahead of Christmas and this is no doubt a reflection of the like for like sales enjoyed by House of Fraser.
"Yesterday John Lewis added a note of reason to the shopping frenzy that took place over Black Friday weekend, and the positive sales figures may be dampened by the erosion of margins that a month of discounting brought. With some post-Christmas sales, including those taking place in John Lewis, brought forward to Christmas Day there was little or no let-up in the opportunity for consumers to shop during the entire month, which could mean an even sharper fall-back in demand in January.
"Margins will no doubt have suffered thanks to the proliferation of sales, but bringing Christmas shopping forward to November will have also enabled a longer period of consumer excess, driving up volume sales. Given that supermarkets are also caught up in a bitter price war with discounters the impact on margins is not entirely due to Black Friday. Retail analysts IRI have claimed that there was actually small decrease in sales values by supermarkets compared to 2013, despite the scenes that took place on Black Friday, although many will await the ONS figures later this month.”
House of Fraser currently trades online and from 59 stores in the UK and Ireland as well as two HouseofFraser.com stores, in Liverpool and Aberdeen. It was bought by Chinese company Nanjing Cenbest in September 2014.