Debenhams Plans for a More Digital Future

UK department store chain looks to be more mobile- and leisure activity-focused

Author: Cliff Annicelli

April 20, 2017

Six months after bringing in a new CEO from Amazon, UK-based department store chain Debenhams is working to make its physical stores "more digital" and placing a greater emphasis on leisure experiences befitting an era of "social shopping."

The retailer's new strategy, dubbed "Debenhams Redesigned," was announced in conjunction with the release of its interim results for the 26 weeks ended March 4, 2017.

For the period, ecommerce sales rose 14.6%, driven by a 64% increase in mobile commerce—growth rates significantly higher than the company's 0.6% increase in gross sales in the UK or its 2.9% gain in companywide sales, which include stores in Ireland and Denmark (as Magasin du Nord) and franchised locations in the Middle East.

Debenhams isn't alone among UK retailers seeing ecommerce—and mobile commerce in particular—playing a rising role in retail sales.

eMarketer expects retail mcommerce to represent 40.4% of UK retail ecommerce sales and 7.6% of total retail sales in the country this year—both new highs.

"Our customers are changing the way they shop and we are changing too," said CEO Sergio Bucher, who joined the company from Amazon in October 2016, in announcing the initiative. "Shopping with Debenhams should be effortless, reliable and fun whichever channel our customers use. We will be a destination for 'social shopping' with mobile the unifying platform for interacting with our customers.

"If we deliver differentiated and distinctive brands, services and experiences both online and in stores, our customers will visit us more frequently and, having simplified our operations to make us more efficient, we will be able to serve them better and make better use of our resources."

Pillars of the digital program include moves such as upgrading technology to help unify the business via mobile and encourage greater incremental business from customers who arrive to pick up online orders.

"We see an opportunity to evolve this experience from being functional and reliable to make it also engaging and sociable," the company noted.

In its interim results, Debenhams noted that over 30% of its online transactions are picked up in-store.

"We see an opportunity to evolve this experience from being functional and reliable to make it also engaging and sociable, linking it with other services, such as personal shopping, to reinforce our ambition in social shopping," the company noted.

The plan's social shopping element involves a greater focus on in-store leisure activities that can be enjoyed between friends and family and shared via social media—activities such as beauty services, eating and drinking or attending events—than on simple product purchases.

In this regard Debenhams is, like other department stores, evidently adjusting to the worldwide trend of millennials and others preferring to spend money on experiences rather than material things.

In addition to its own improvements, the retailer also said it would increase digital distribution through strategic partnerships, including a plan to launch sales via Amazon's site in Germany in May.

Photo Credit: Debenhams