Browett exit a blow to Dixons, but it’s on the right course

The news has just broke that John Browett is to leave Dixons Retail to take up the role of SVP of Retail at Apple, reporting directly to Apple CEO Tim Cook. Browett will step down from his position on 20 February 2012 and will leave the company on 20 April 2012, following a handover period.

Browett will be replaced by Sebastian James, who is currently Group Operations Director. Katie Bickerstaffe has been appointed to the new role of CEO of UK & Ireland.

Improving customer service has been a key focus for Browett

Dixons has to remain on course

There is no doubt that Browett’s exit will be a blow to Dixons. Under his leadership, the retailer’s progress has been remarkable - in terms of store formats, customer service, private label, online positioning and relationship with major brands. Back from a recent trip to view Dixons Retail operations in Sweden, I know that Browett was highly regarded across the group.

The good news is that James also played a leading role in assisting Browett in the Renewal & Transformation programme. Alongside Katie Bickerstaffe, who will lead the UK & Ireland operations, the aim will be to carry on the programme of transformation and renewal that has been pursued in recent years. With Best Buy having closed its superstores in the UK and rival Comet with an uncertain long term future, there are some reasons to be optimistic - particularly if economic conditions and consumer confidence improves in the future.

Business as normal then, but there will be some key challenges/questions/opportunities for the team:

• Retaining the improvement in customer service: They are on the right track, but it will take years to fully change the perception amongst UK consumers that Currys/PC World offers poor customer service. The fact that this year Dixons will take over the running of the Harrods electronics department this year (an you imagine that happening 5 years ago?!) illustrates the progress made so far. Good job so far, but the foot needs to be kept firmly on the pedal.
• What to do with pure-play e-commerce? : There is no doubt that the past couple of years have seen sales at Dixons Retail’s pure-play e-commerce operations (such as Dixons.co.uk and Pixmania) fall as customers have favoured multi-channel. Pixmania is already trying to open its own stores to act as click & collect points. But, long term a decision may be to streamline some of these brands if they continue to underperform.
• Keep on transforming the stores: The latest Megastore and 2-in-1 format stores are a vast improvement over what they have replaced and have helped to grow sales in many markets (such as the Nordics) as well as protect against superstore rivals such as Best Buy in the UK and Media Markt in Sweden.

Browett to Apple

One question I’ve already been asked by a number of journalists has been: “Why Browett? And what will he bring to Apple?” Here are some of the reasons.

• International: Browett brings expertise of international electronics markets (albeit primarily in Europe). But, operating a retail operation across a number of markets (tough ones at that) is clearly valuable experience for Apple which is looking to grow the number of stores it operates across the globe.
• Customer service: As described above, Browett recognises the importance and value of customer service and the store experience. Where better to take those skills and passion then to Apple, whose stores are all about great service and a memorable experience. “Our retail stores are all about customer service, and John shares that commitment like no-one else we’ve met,” said Apple CEO Cook.
• Retail experience: Browett’s experience of operating Apple implants with Dixons Retail stores across Europe could also be valuable. Dixons had a good relationship with Apple (they had a UK exclusive agreement for the sales of the iPad 2 in 2011) so Browett was highly regarded within Apple.