Superpower status

It?s easy to knock those at the top. A news story about PC World or Currys on the PCR site is almost certain to elicit a few negative comments. Usually they accuse the stores of being box shifters with little product knowledge. It?s an attitude DSGi acknowledges, and it understands that it?s a knock on effect from its business model of old, which to be fair was mainly centred around price promotions. It?s an image the group has been trying to get away from for a long time.
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The firm began its revamp strategy around two years ago, a process of restructuring and rebranding its diverse portfolio of 650 sites in the UK. Alongside its advertising campaigns, much of this work is being done in an effort to separate itself from that image and update its business model to the world where service and support is almost as important as the hardware itself.

There are many smaller retailers that will always debase the firm as simply a box-shifter, perhaps understandably on their part. But love it or hate it, DSGi couldn’t be much more active in adjusting its business model to meet modern market head on.

And you've got to say the strategy appears to be working, if the group’s eight per cent Christmas growth is anything to go by. With yet more store overhauls and the possibility of new sites due for 2010, it doesn’t look like it’s letting its foot off the gas, either. At the moment DSGi enjoys the sort of solo superpower status enjoyed by the British Empire in the 19th century, or the US after the collapse of Soviet Union. But there is a dark cloud over the UK’s biggest PC and technology retailer.

There are bound to be clashes in spring when the first three Best Buy megastores supposedly open doors in the UK (it has been delayed since the same time last year). The US megastore's PR machine has already begun revving its engines with the launch of Right now it appears to be limited to blogs, reviews and buying guides, and unable to actually sell anything. But it can be considered to represent the first troops on the ground.

The confrontation between the two retail giants has been a long time coming. It’s bound to be a consideration in DSGi’s 2010 planning, but more than that, it could be one of the year’s defining factors for the UK trade. If those smaller retailers we mentioned think the presence of one superpower impacts their businesses, a trade war between two of them is likely to do the same.


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