Author: Miranda Botcherby, 05 April 2018

In a time where we appear to be seeing more bad news than good on the High Street it is hard not to believe the picture of doom and gloom. However, hidden amongst the chaos, there are a number of retailers taking strategic steps to help futureproof their business model. Within this blog I am focusing on the ongoing efforts made by popular department stores to help keep themselves relevant in today’s market. 

Department stores improve their services

Running through the most recent news articles there is a clear trend -it is no longer acceptable to just provide an arena for people to browse items they might or might not purchase, customers making the trip must feel as though they’ve had an ‘experience’ beyond just consuming. John Lewis has led the way in embedding this ethos into their new stores, creating a “place to shop, do and learn under one roof”. Experience Desks, Discovery Rooms and Style Studios help customers to plan their day, learn new skills and customise their shopping experience. Debenhams has also recognised the benefits of curating a unique experience for customers in their stores; recently launching a “click, try and buy” service in their Stevenage store. Different to an ordinary click-and-collect, it allows customers to either book a changing room to try on their purchases or book an appointment with a personal shopper.

Department stores are changing their business model...

by diversifying their use of space and inviting new businesses into their operation. Recognising the surplus space in larger stores, major names are being creative with its use. By expanding their offer these retailers are increasing footfall whilst generating additional income streams. Some of the recent examples include:

Historically department stores have relied upon popular brands to draw the crowds; however the retail climate is competitive, and ordering online is easy, so department stores are no longer the default location to shop the brands. Conversely, there is an ever-growing recognition amongst department stores they must retain a degree of exclusivity. John Lewis recently announced a lofty ambition - 50% of its stock would be exclusive to the brand. Likewise, Debenhams has taken a clear step to gaining a point of difference versus the High Street, with partnerships with furniture brands Swoon Editions and Maison Du Monde, both of which only had a UK presence online. 

While the concepts discussed are currently limited to a small number of locations within a department store’s portfolio, in an increasingly competitive market, to remain relevant the key players must roll out this ethos beyond their flagship stores, building and maintaining customer loyalty as they go. 

Department Store Diversification

Post a comment

FSP View - Looking to the future

Following the news that over a quarter of the UK’s largest retailers are loss-making, FSP consultant Harri Jaaskelainen explains how we can help you understand risks and maximise returns with a forward looking view, before things get bad.

Continue Reading

A fresh look at payment data

FSP’s Payment Analysis research looks at the range of consumer shopping payment methods, with the aim to dig deeper into how we interpret the benefits - and limitations - of different payment data.

Continue Reading

A Surprising Amount of Cash

FSP's Technical Director, Dave Stevens, comments on the future of cash in the wake of the Spring Statement

Continue Reading