Intelligent Investor

There should be no other store like David Jones

Jason Prowd used to love DJs, but not any more. Here's his open plea to chief executive Paul Zahra to change the situation.
By · 23 Feb 2012
By ·
23 Feb 2012
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Dear Mr Zahra,

I love department stores, especially David Jones.

Or, at least I used to.

As I wander through my local David Jones stores (either Bondi Junction or Sydney City) there's nothing special, exciting or even unique about what I see. Plenty of other stores have better service, flasher fit outs and a bigger range. Where's the 'wow' factor?

With retailing moving online, consumers becoming more spend thrift and Westfield muscling in on luxury retailing, you should be acutely aware of the problems facing department stores. Drawing customers to DJs is only going to get harder. You need to innovate to entice them.

Here are a few suggestions.

1. Integrate online and offline – Watch Minority Report to see what I mean. And it's not as farfetched as it might seem. Almost every DJs customer would have a smart phone. Why not build an app that lets customers buy products in store with their phones and then deliver the purchases to their home or office? This would even free up labour to help with ideas 2-5.

2. Bring back the doorman – Live music during the Christmas season is nice, but the 'beethoven-wannabe' in not 'adding-value'. Ditch them and bring back doormen. And I don't mean security guards. I mean friendly store experts that wish you well, help you find where the cuff links or Panettone cakes are and open the door when your hands are full.

Courtesy of Mitchell Library, State Library of NSW (ML F381.141/ 1)

3. Better merchandising– Most shoppers don't know what they want. Your job is to 'help' them. How about a few more in store displays that combine brands in both an artful and practical way? (p.s. the latest 'NYC' themed window displays are a good start.)

4. Segment fashion by age/style rather than brand/price – Currently DJs organises fashion by gender, brand and price (lower floors generally mean cheaper). This is a symptom of the 'concession model', effectively 'stores within stores'. I'd revisit this model. It's not enough to offer goods all in one place. You have to apply DJs' collective retailing wisdom gathered over the past 174 years.

No 20-something wants to shop in the same section as 60 year olds. Additionally, if Spanish clothing retailer Zara has taught us anything about fashion it's that customers increasingly choose fashion based on style not price. It's not uncommon to see someone wearing $1000 shoes with $100 jeans.

Moving away from the concession model would also make the staff more helpful, currently the incentives are skewed to encourage staff to flog more of particular brands. That's great for the brands but not for customers or DJs.

5. Improve private label, add more unique products – The current DJs private label merchandise is okay, but not fantastic. The quality could be improved. Famous UK department store Harrods does a fantastic job of this (and you even stock their merch!).

Also, carry more unique merchandise. There's nothing at a DJs, bar private label, that I can't buy elsewhere. Why not get behind small upstart homewares brands or clothing labels? Give them to Miranda Kerr to flaunt; I'm sure they'll be a hit.

That's five simple ideas and I'm sure there's many more.

There should be no other store like David Jones, but currently I'm not convinced.

Kind regards,

Jason Prowd.

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