By Claire Reilly
Although today's release of JB Hi-Fi’s annual results show that its overall growth has been hit by the struggling consumer electronics retail sector, the company’s performance away from bricks and mortar paints a very different picture.
In its results presentation, JB Hi-Fi dedicates space to its “out of store” offering, which includes its online store and digital products – namely the company’s JB NOW music streaming service.
“Out of store sales…have continued to show high growth,” said JB Hi-Fi’s CEO Terry Smart. “We continue to see significant upside as our innovation and investment in these areas continues. Whilst our digital strategy is about future earning streams, online is a great opportunity for the brand to expand well beyond the categories we offer in store today.”
For the 2012 financial year, online sales grew to $50.8 million. While this only represents 1.62 per cent of the company’s total sales, it is an increase of 77.3 per cent compared to the previous year. Similarly, unique visits grew by 41.1 per cent from FY11 to FY12, growing from an average of 675,000 per week to 927,000 per week. Although the growth is off a low base, the company’s online store is clearly a strong performer.
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The company was also upbeat about its music streaming service JB NOW, which was launched online in December 2011, with mobile apps coming to market in April this year.
“[The] concept of music subscription streaming services is gaining traction as market players increase, [and the] NOW platform will provide longer term growth as it expands into other categories.”
As well as expanding the NOW platform into other categories, JB also indicated plans to expand its online offering into new categories and ranges, and to provide depth that is “beyond what is feasible in store”. The company also announced its intention to launch a new website in the 2012-13 financial year to “provide an improved user experience across multiple platforms.
“We continue to believe the future of retail is an integrated customer offer where our unique and high energy retail format, combined with our innovative online and digital platforms, will ensure JB Hi-Fi’s customer proposition is one that our competitors are unable to match.”