While Australian retailers are issuing pessimistic outlooks about consumer spending for the remainder of the year and into the holiday season, Scott Fyfe, the CEO of upmarket department store David Jones, is instead optimistic.
The boss of the 186-year-old David Jones department store who has previously said that even well-heeled customers have their spending limits, has found that many Australians were now adapting to living with the cost of living pressures, and were prepared to spend up for the Spring racing carnival as well as Christmas.
Fyfe told The Australian that both Mother’s Day and Father’s Day had generated good sales bumps for the business and this momentum is expected to continue.
“Without doubt we have seen economic headwinds hit the customers. What we can see at David Jones is that when there are events they will come and trade with us. So, Mother’s Day was really good, Father’s Day was good. We are really optimistic about Spring racing.
“We think customers will trade into Spring racing this year and Sydney is already showing promising signs. We had a very good week in the Elizabeth Street (Sydney) store and some of our stores around Elizabeth Street, and New South Wales, particularly on men’s and women’s fashion, new fashion that we have launched.”
He added the sales momentum into Spring was looking better than the same time last year. “This time last year was definitely a time for shoppers controlling their purse strings. They were buying a shirt rather than buying a complete outfit. We think this year that people now are living with the cost of living pressures so we look forward to them buying complete outfits from us.”
Fyfe has confirmed that David Jones will release its new mobile shopping app next month.
“Two things we are going to launch. We are going to launch a customer app at the end of October, so that will be a new way for us to connect with customers. We will have push notifications and we will have customers opting in to app functionality which will accelerate our digital offer. We have actually tested that app internally and it has done really well.
“And then in early 2025, we will build loyalty into that, so watch this space as we have a great proposition coming.”
David Jones’ push into the digital space comes as it attempts to compete for customer loyalty with the Olivia Wirth-led Myer.
David Jones management is believed to have recently visited famous overseas department stores, and is building on the idea of customer loyalty schemes which also offer in-store ‘experiences’, rather than just points to spend on items, taking a close look at British retailer Selfridges and its loyalty strategy. Fyfe himself previously worked for over two decades at Marks & Spencer.
He will reportedly oversee an investment of $250m in the David Jones business over the next three years, of which $100m will be invested in its stores to ensure that by 2027 more than 42 per cent of its store footprint (stretching across 40 outlets) will be refurbished.
Meanwhile, $75m will be directed towards updating and expanding the chain’s digital offerings across online and smartphone apps.
In the 2023 financial year, David Jones recorded around $2.3 billion in sales and delivered earnings before interest, tax, depreciation and amortisation of $115 million.
