Strategy: Ailing retailers are looking at ways to entice younger shoppers
Laura Ashley has launched a battle to win over younger shoppers after profits were all but wiped out last year.
Amid warnings that the 60-year-old retailer was losing relevance, bosses are revamping the homeware range to entice new customers.
Fellow struggler Debenhams is also fighting to attract millennials by opening collection points in stores where shoppers can pick up orders from the likes of Amazon and Asos.
And it is preparing to open gyms in shops which will offer customers money off to spend on beauty products depending on how often they work out.
But experts warned retailers were in danger of alienating loyal, older customers. Russ Mould, investment director at AJ Bell, said: ‘Going for the younger generation is not as easy as it sounds, it’s seriously competitive and they haven’t got a boatload of cash.
‘What you’re going to do is get dragged into a more price-competitive, possibly lower margin market if you don’t get your stock right.
‘Laura Ashley has a heritage and style, it’s a big call to move away from that.’
Laura Ashley’s latest accounts showed profits plunged 98 per cent to just £100,000 in the year to June 30. Despite strong fashion sales, up 9.7 per cent, a dismal performance in its furniture and home decorating divisions dragged sales 0.4 per cent lower. It said it would cut prices and has launched a range of Scandinavian-inspired sofas and armchairs.
Debenhams hires finance chief on £1.4m
Debenhams has appointed Rachel Osborne as chief financial officer just months after she abruptly quit her job at Domino’s Pizza.
Osborne, 53, will join in September, earning as much as £1.4million a year, as the struggling department store desperately tries to turn itself around. Osborne left Domino’s in June in a surprise move after less than two years. At Debenhams, she will be paid a salary of £439,000.
She could pick up another £878,000 in bonuses and other awards.
And she will get a pension provision worth 15 per cent of her basic salary, or £65,850, a car allowance of £17,850 and private medical insurance.
It is also planning to roll out its franchised hotels and tea rooms, which brought in £2.1million of sales last year.
Traditional retailers such as Laura Ashley, Debenhams, House of Fraser and Marks & Spencer are battling to keep up with online-only retailers who quickly adapt to changing tastes by making cheap and cheerful clothes.
Fiona Paton, analyst at GlobalData, said: ‘Laura Ashley must start engaging with modern designs.’ Sean Anglim, joint chief operating officer at Laura Ashley, said it would continue to sell its traditional range, saying: ‘We’re still happy with our core range but we feel the need to supplement some additional products.’
Laura Ashley said its profits blow was mostly down to a £4.7million impairment charge on the sale of an office block in Singapore. Elsewhere, Debenhams said that its deal with delivery service Doddle is already paying dividends.
Ross Clemmow, a director at Debenhams, said: ‘We’ve seen more young customers coming in to collect online orders, and then staying to shop with us. We believe partnerships like this can help bring a new generation of shoppers onto the high street.’