LONDON — British retailer House of Fraser has laid out its initiatives for the next five years.
At a presentation held at their head offices on Baker Street, chairman Frank Slevin said it’s been a transformational period for the company. “The business was undoubtedly insufficient [for] probably over at least 20 years…,” said Slevin. “It was essentially on life support. The store portfolio had been neglected. We had no clear vision for the future and poor understanding for our customer base at the center. I think we knew the customer out and around the store, but I’m not sure we really knew who our customer was at the center of the business. Our product line therefore was not necessarily in line with what our customer wanted from us and there’s no doubt that our marketing was definitely not in line with our customer. In addition, we had a brand that was premium but not really developing with the times.”
On a positive note, Slevin touted the company’s heritage, product portfolio, brands and partners. “The store portfolio has great potential,” he said. “We’re a business assaulted from all sides by disrupters of all forms and we need to be a disrupter in this market. We cannot sit passively by waiting to be disrupted. We have an opportunity here to be in the forefront of that change. Department stores have a unique opportunity to lead the way. We have scale, we have incredible locations, and we have a very loyal customer base and we’ve already started to make significant changes.”
Chief financial officer Colin Elliot said the retailer plans to spend 45 million pounds, or $55.6 million, on improvements with a focus on its IT infrastructure. Meanwhile, David Walmsley, chief customer officer, said the company reviewed their product, customer experience, infrastructure, warehousing and logistics. Through focus groups, Walmsley said the company has redefined their customer who is “perfectly imperfect” and has a “purpose-driven lifestyle built around children and her partner and her lifestyle is complex.” Walmsley said knowing who the customer was, it was able to reposition accordingly.
He said next month, the retailer plans to launch House of Fraser Journal with 900,000 copies to be distributed and sent to its customer database. Another area it’s developing is its web site — which will relaunch. In addition, it plans to have a mobile-first mind-set, adjusting the platform for digital devices. Other initiatives include more costumer service contact in-store, hosting more events and incorporating experiential treatments, such as restaurants within the shopping experience.
Maria Hollins, executive director, buying and design, said women’s wear is the retailer’s biggest fashion category and that it plans to streamline its offering. Hollins said the nine house brands will be reduced to five and the retailer will introduce accessories collections for each. Linea, the oldest brand carried by the retailer, will get a sleeker and more contemporary look, while better materials and fabrics will be used for Biba. The retailer plans to launch another in-house brand later this year, but was mum on the details.
In terms of their third-party brands, House of Fraser plans to extend names such as Jigsaw and North Face while cutting others. “We’re also going to be exiting some brands,” said Hollins. “Brands that are at the extreme end of our current range…our young fashion brands and our older-generation brands. What we’ll do is that we’ll focus more on the brands that resonate with the customer.”
The retailer plans to focus on fashion, beauty, lifestyle and home items and will allow more space to showcase merchandise for brands such as Barbour. There will also be a “Test Bed” area, a dedicated space of brands that will be refreshed seasonally, as well as an ath-leisure offering — with Acai as one on its exclusive labels — and a gifting area, positioned on the ground floor. Hollins also addressed pricing and said they are moving away from discounts and focusing on a more disciplined approach to sales, tightening their buys and reducing overall stock levels.
To date, the company has invested in 12 stores over the last two years and its online business now accounts for 20 percent of sales. Slevin said House of Fraser has opened a store in Nanjing, in China, the retailer’s first step in their expansion into Asia with plans to expand in the Middle East. The company has also launched a responsible retailer program and set up the House of Fraser Foundation, to focus on charitable efforts. “We are in active negotiations on a number of potential locations in the Middle East,” added Slevin.
The company has seen a wave of changes over the past few years. It is operating without a chief executive officer, but Slevin said he is confident in his committee. “I’ve got a first-rate group of executives running the business,” he said. “This is a situation where it is important for us to get the right person to run the business. But hopefully, you’ve seen today that the people in place are the people who I think are right to drive change in this business going forward.”
As reported in November, Nigel Oddy resigned as ceo after less than two years in the role.
RELATED STORY: Nigel Oddy Steps Down as Chief Executive Officer of House of Fraser >>
According to British media reports last year, House of Fraser’s owner Yuan Yafei of Sanpower has not made good on promises to invest in the store or in international expansion. Sanpower purchased House of Fraser three years ago.
It has also been a rough time for British high-street retailers. Last year, BHS and Austin Reed were both placed into administration.