Along with all the year-end festivities going on this week, it seems like UK retail has something else to celebrate: the complete turnaround of Dixons.

Along with all the year-end festivities going on this week, it seems like UK retail has something else to celebrate: the complete turnaround of Dixons.

Dixons chief executive Seb James has publicly declared that the company is out of the “hospital ward” after revealing first half underlying pre-tax profits of £32 million, its first profit in this period for six years.

It’s fantastic to see this fighting spirit coming from a high street retailer in the electronics space, especially because we’ve been hearing so many stories of this market’s imminent demise in recent years.

All too often, the media seems obsessed with companies that are either doing extremely well or who are struggling – but that means overlooking companies like Dixons that have staved off difficult trading conditions to make a complete turnaround.

Needless to say, the company has been helped by the fact that Best Buy and Comet have both exited the market. However, that is actually just one small factor in Dixon’s success.

Electronics retailing has been hit especially hard by the growth in e-commerce as consumers continue to turn to more flexible (and often cheaper) online options such as Amazon.

Dixons, however, made the bold decision to address weaknesses in this area by measures such as improving its service offering, engaging with customers more effectively and beefing up its multichannel capabilities.

It’s a strategy that is clearly working and which shows no sign of abating. The company has already said that it will step up the fight against Amazon next year by ramping up its online customer service and launching a new app that allows shoppers to scan products in-store and compare prices with Dixons’ competitors.

Dixons’ in-store efforts haven’t gone unnoticed either. Its ‘Showhow’ service, which offers customers individual tutorials on their new products, has reported 76,000 sessions since the launch of the service in September 2012.

Dixons also has plans to improve the in-store experience even further with a number of retail innovations. This includes mobile and flexible fittings that will allow the retailer to adapt to new technology trends more quickly, as well as ‘heat map’ cameras that can provide valuable insight into how customers interact with different merchandise displays.

Seb James has committed to focusing on what Dixons customers actually want, rather than eye-catching initiatives.

Such innovations show that he is putting his money where his mouth is. And the results speak for themselves, with the company’s share price doubling over the past year.

For Dixons’ shoppers and investors alike, it looks like Christmas has come early this year – and the New Year is looking bright.

  • Dan Coen, director, Zolfo Cooper