Dixons has a strong management team and are very solid operationally, but it now needs to transform the brand and the customer’s experience and perception. 

Dixons has a strong management team and are very solid operationally, but it now needs to transform the brand and the customer’s experience and perception. 

It has started this process, but need to crank it up a gear and invest in it further, which begins with hiring the right staff. People need to love Dixons, like people do Apple and John Lewis. You walk into their stores and feel the passion and energy for the brand and its products and that really does form a huge part of the customer experience.

If Dixons can get that nailed then it will benefit it enormously. At the moment though, when you think of Dixons, it still conjures up an image of times gone by and feels a bit dated.

With Comet out of the picture, it’s given Dixons more breathing room in the short term. Reduced competition has meant it has been able to engineer a rise in sales and profit with Comet’s demise increasing Dixons’ foot traffic and sales by 13% like-for-like in the fourth quarter.

However, long-term, Dixons need to view Comet’s ill fate as a warning. The high street is changing rapidly so figuring out how to crack multichannel is the key to Dixon’s survival – attention to web, and increasingly mobile, will be pivotal to them. It’s still not clear what their strategy is here, but if they want to maintain strategic growth in the UK and overseas, they need to excel in multi-channel and customer experience. The integration of online and mobile technologies will be the key to winning wallet share of UK consumers.

Dixons also need to figure out how to increase its market share in high(er) margin products like tablets and the coming generation of wearable computing and smart technology. When it comes to growth outside of the UK, the consumer electronics market is very challenging and it may be safer be to focus on strength in the UK first.

As for the strategy to exit the Pixmania business, it really is the right decision.  It will allow management to focus on the success of healthier business units and will begin to bear fruit quickly.

Kevin Gillan is managing director of electricals warranty specialist SquareTrade Europe

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