Dixons brand to migrate to internet

Dixons owner DSG International prompted considerable surprise yesterday when it said the brand name will be removed from its British stores and used exclusively on the internet.

DSG will continue to use the name in its rapidly-growing Irish business, but the changing brand strategy underlines the health of the Irish retail market while pointing towards its future evolution.

With retailing in the doldrums in Britain and profit margins under severe pressure, DSG closed more than 100 loss-making stores in 2004. It went a step further yesterday with plans to sell smaller electronic items such as iPods and MP3 players on the Web while hoisting the Currys brand at former Dixons outlets in the drive to concentrate on higher-margin white goods such as fridges and televisions.

DSG general manager in Ireland Declan Ronayne said "nothing changes" in its Irish unit, whose annual sales of €117 million now eclipse domestic rivals such as Power City (€88.83 million) and DID Electrical (€65.76 million).

With 21 Dixons, Currys and PC World stores, Ronayne said DSG remains on the look-out for new outlets, mostly outside Dublin.With British, European and US retailers arriving en masse to take advantage of the Irish retail boom, the spending spree shows no sign of abating. The €400 million Whitewater centre, which opens today in Newbridge Co Kildare, is just the latest of new shopping developments in Dublin's commuter hinterland.

For all that, DSG's decision to move an iconic brand online to sell items that the can be easily sent through the post heralds the latest phase of an "e-tailing" revolution which has seen a generation accept as banal the use of the internet to buy books, CDs, holidays and plane tickets.

The group has form as a trend-setter. It was the first in Britain to sell electronic goods online and it was the first to stop selling video players in 2004 when DVDs stole the march on the old technology.

But if business in Ireland inevitably follows the international story, those looking for a mass market online revolution will have to wait until the broadband makes its mark.

While business in Ireland is good for DSG, Ronayne made a point of saying low broadband penetration means he will focus on bricks and mortar. "Seventy-one per cent of homes in Britain that have an internet connection have broadband."