By Patrick Avenell
SYDNEY, NSW: David Jones CEO Mark McInnes has described in detail what sets his department store apart from its nearest competitor, Myer. In a presentation at an Australia-Israel Chamber of Commerce business function, McInnes said David Jones had positioned its stores to appeal to consumers with more money to spend.
“They’re a fine company and we respect them, we’ve been competing with each other for 100 years in different markets so we’re old competitors,” McInnes said.“But there are some structural differences between David Jones and Myer and it’s worthwhile pointing out those differences.”
McInnes said the main differences were that David Jones has a unique international brand and brand portfolio, a service proposition and a store ambience proposition to provide the listed department store chain with enduring market share.
Additionally, McInnes pointed out that David Jones financial services arm, which includes the David Jones store card, had been significantly boosted by the introduction of the David Jones American Express card, which earned $41.3 million last year, and is growing by a reported 7.5 per cent.
One of the major points of difference McInnes highlighted was David Jones’ property consideration. He said that the ownership of stores, and the geographical location of these stores, gave David Jones a competitive edge compared to its main rival.
“We own our CBD stores in Sydney and Melbourne, which means the extra cash we generate from those buildings, rather than going to landlords, goes to our shareholders.
“All of our new stores are in medium to high income demographies and two-thirds of our competitor’s stores are in low income and regional demographies.”
In other David Jones news, McInnes told the Australia-Israel Chamber of Commerce that the stroe would not be expanding its online sales business in the medium term. McInnes said that whilst David Jones Online does currently have a hamper, cellarmaster and information business, and this makes around $15 million annually, he saw the internet more as a tool for information dissemination, rather than sales or revenue.