Dunelm has announced its incoming chief executive following the retirement of Nick Wilkinson after seven years at the helm, but it’s not just a changing of the guard for the homeware retailer – could it be a pivot towards digital innovation?
From October this year, Sainsbury’s tech and digital chief Clodagh ‘Clo’ Moriarty will leave the business after 15 years and take the helm at Dunelm. A frontrunner among retail’s digital elite, Moriarty has had not one but two roles created specifically for her at Sainsbury’s and has driven through innovation like SmartShop and same-day delivery. Her departure will undoubtedly be a huge loss for the supermarket group, but what might she have planned for her first chief executive role?
At present, Dunelm remains a very stores-forward retailer, with its latest results revealing that online represented 39% of its total sales, with the rest coming from its almost 200 stores. According to GlobalData senior data analyst Matthew Walton, Moriarty will see plenty of room for growth within the channel.
“Nearly two in five pounds spent at Dunelm goes through online channels, which shows there’s definitely room for growth” says Walton.
“We’re seeing consistent appetite for buying homewares online. Amazon ranks quite high in the homewares market as an online player. While there was a pandemic spike that unwound, over the last couple of years we’ve seen improvement in online penetration, which we’re forecasting to continue. We’re seeing consistent share gains for online penetration over the next five years.”
Some of Dunelm’s closest competitors in homewares are value players like B&M and Home Bargains, so by differentiating itself with a stronger, more efficient online sales channel, perhaps even with a new app or greater connectivity within its stores, it could continue with its clear market lead.
“I think they could learn from the Argos model” says Walton.
“Argos is is very much an online business that successfully brings together the multi-channel offer with collection points and integrates stores and online seamlessly. I also think they could definitely do more to link their stores with their online presence. They have tablets in stores currently, but there’s opportunity to bring the channels together more effectively. The introduction of an app, that works well, could be a key part of this strategy.”
Ultimately though, Moriarty will look to keep up the overall satisfaction levels of the customers who are shopping online.
“There’s been consistent improvement in customer satisfaction for online shopping, which is positive,” says Walton.
“They’re getting more customers using online, but the next step is ensuring existing customers are more satisfied and encouraging them to shop more regularly.”
Tough to replace
Having worked at the retailer for over 15 years, Moriarty has made a huge impact on the grocery giant. Having joined the business in 2010, she spearheaded the creation of the brand’s digital strategy across Sainsbury’s and Argos, as well as it’s Nectar Loyalty Scheme and Sainsbury’s Bank under the previous leadership of chief executive Mike Coupe.
In 2018, she was promoted to the first of her two new roles created specifically for her at the business, stepping up to become chief digital officer. In this role she was again central in spearheading new tech innovations – particularly around its rapid delivery fulfilment proposition Chop Chop and SmartShop, which allowed customers to scan products in-store on their smartphones.
In 2020, she was named retail and digital director, helping navigate the brand through the teeth of the gale that was Covid-19, where a number of the innovations she had worked on previously truly came to the fore in a socially distanced retail world.
Because of the length of time at the retailer, and her expertise in the tech and innovation space, Sainsbury’s insiders say the business is still pondering internally how to replace Moriarty.
“Everyone is very sad to see her go,” the insider says. “No decisions have yet been made whether to look at either an internal or external replacement for her. In truth, we haven’t even started that process yet.”
Moriarty’s departure has raised some speculation amongst Sainsbury’s observers, questioning whether her vision for the brand totally gelled with that of chief executive Simon Roberts. Roberts’ tenure at the retailer has been marked both by consistent trading success, but also a relentless focus on putting food at the heart of the retailer’s strategy, some say at the expense of other parts of the business.
Whether there may have been some tension behind the scenes or not, Roberts has paid tribute to Moriarty, saying that her next step into the top role at a retail business is a reflection of all that she has achieved at her time with the grocer.
“Clo Moriarty has made a huge contribution to Sainsbury’s and our success over the last 15 years. Clo has been offered a fantastic opportunity to become a CEO, reflecting her talent, capability and leadership. I and we are incredibly grateful for everything Clo has done and she leaves with our thanks and very best wishes for what’s to come.”
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