Consumers who bought a curved Ultra HD television or a pair of Bose headphones from Dick Smith in the past 12 months likely picked them up from inside a David Jones department store.
After one year exclusively operating the electronics category of David Jones under a concession branded David Jones Electronics Powered by Dick Smith, CEO Nick Abboud has spoken about one of the company’s core growth strategies; operating new store formats to target more diverse demographics.
The three year deal between the two retailers took effect in 1 October 2013, and Dick Smith currently operates 29 David Jones Electronics powered by Dick Smith outlets. The outlets primarily retail mid- to premium-priced aspirational consumer electronics products, with a focus on televisions, high-end audio, computers and mobility.
In an interview published in The Australian today, Abboud said the aim of the David Jones concession was to get in front of a different customer, “so Dick Smith is mainstream Australia and David Jones gives us the upper end of the market.”
According to Eli Greenblat’s report, David Jones stores currently account for only 3 per cent of Dick Smith’s total turnover, however more than 50 per cent of Dick Smith’s total sales of specialised, premium-priced electronics categories come from within David Jones stores.
The second major new retail format for Dick Smith is its Move ‘Fashtronics’ concept stores which target a young affluent demographic. Move was nominated for Best New Retail Concept at the 2014 World Retail Awards and it was recently announced that seven Move-branded retail outlets will open across the domestic and international terminals.
Speaking about the airport expansion plans Abboud said, “This opportunity is consistent with our strategy of achieving strong sales and profit growth through low capital intensity initiatives such as David Jones and Move.”
“We are very pleased with the initial performance of our two new formats. Catering for a diverse demographic not fully serviced by Dick Smith stores, Move and David Jones complement our market leading network of Dick Smith stores,” Abboud said in the company’s 2014 full year financial results.