HR & Management
How can House of Fraser relaunch under Sports Direct’s ownership?
5 min read
17 August 2018
It beats being bought for a pound like Homebase (£90 million isn’t too shabby), but House of Fraser’s acquisition by Sports Direct is nonetheless an odd retail story.
There’s so much potential for relaunch here, rather than business simply continuing as usual. Because, if it just stands still, if it just waits for people to come rushing back, banking on loyalty… where’s it going to end up?
In the graveyard, next to Toys R Us, Poundworld and Maplin. Victims of 2018’s cut-throat high street. A plot’s already been dug out for House of Fraser, but Sports Direct’s bailout is a second chance.
House of Fraser is old-fashioned. It’s stuck in a realm of obscurity, neither here nor there, the cousin in the attic while M&S and John Lewis play downstairs.
It has no clear demographic – it just exists. Its weak internet presence meant it never tied its physical and digital fronts together.
When you look at ASOS’ photo-recognition app, pushing customers from physical stores onto ASOS; or John Lewis’ concierge-style, experiential store in Oxford, which offers free grooming and tech training, how can a business without a strong social media face, without fluid multi-channel integration, hope to compete?
House of Fraser now needs to establish a clear-cut, defined new strategy that targets an audience it actually understands. Sports Direct should be able to help with this.
After all, Sports Direct has experience here. The company’s chief executive, Mike Ashley, owns a share just shy of 30% in Debenhams. That makes the chance of a merger a possibility. Could House of Fraser follow in Debenhams’ footsteps, filling excess space with coffee shops, gyms and offices to claw back expensive business costs, appealing to the multi-faceted consumer of 2018?
Ashley needs to relaunch the business in a way that’ll actually excite people – view House of Fraser as less market trader and more emporium. It’s not about discounts, enticing buyers with low prices then leaving no budget for internal improvement. It’s about creating the retail experience customers want.
Visiting a department store used to be the equivalent of having a nice night out. How can that glitz and glamour be mixed with modern consumer demands in a department store format?
Last year, Selfridges’ and Harrods’ sales rose 16% and 23% respectively. Because they’re the top-tier, with a worldwide following. The big-hitters, glittery worlds of their own, delivering exclusive in-store experiences. No retail business can really compete in terms of luxury or size alone, so how else can they make their mark?
Perhaps House of Fraser could step into the experiential realm? Sports Direct’s in-store, multi-platform activations with Nike always generate huge amounts of engagement, because they envelop shoppers. They link digital and social with the physical store; they connect in a way that goes beyond the products, beyond advertising.
A relaunch could give House of Fraser a real voice, aligning with Ashley’s other pursuits to offer something that makes it stand out. He plans on making it “Harrods of the high street”, developing deeper ties with luxury brands. House of Fraser already has those links, so the potential for experiential activations suddenly seem a whole lot more practical.
The buyout allows Ashley to start from the ground-up, shirking any baggage from previous owners. This leaves the business more malleable, more willing to change – it has less to lose. He still plans to keep 80% of stores open. This is promising news for both the business and employees.
It’s a comparatively small hit, and the slight downsizing should buy House of Fraser time to work on the most important thing: what it stands for now, and what it’ll stand for in the future.
The retail space is cut-throat as it is. House of Fraser should be looking to the latest trends and innovations, taking the opportunity to start again and re-establish itself as a market leader.
Staying still will surely be the death of House of Fraser… again. Let that be a lesson to all businesses.
Alexis Eyre is head of marketing at launch specialist agency Five by Five.