Myer has ‘lost relevance’ and been left behind by rivals, admits new CEO
New Myer chief executive Richard Umbers has admitted the department store has failed to keep pace with international rivals and “lost relevance” with customers as the struggling firm posted a 23 per cent slide in first half profits.
In a withering assessment of the brand, Umbers, who took over from Bernie Brookes earlier this month in a move which saw marketing chief Daniel Bracken promoted to deputy CEO, said Myer has not responded to changes in the retail environment.
The result has severely dented earnings and allowed competitors to take market share, he said.
Speaking after the company reported an after tax profit of $62.m amid poorer-than-expected sales, Umbers conceded that Myer has been left behind by more forward thinking rivals.
“We acknowledge that in recent years, cost growth has outpaced sales growth, and profits have declined,” he said. “At a macro level, the challenges are well known, particularly the globalisation of retail which has brought new competitors to our shores.
“Digitisation has both empowered the consumer and created new channels to market. Customers have changed the way they shop and their expectations of retailers have changed significantly.
“Some elements of the existing strategy represent solid retail fundamentals. However, overall it did not deliver a business model able to respond to this new retail environment and we have lost relevance with some customers.”
He said there is “strong evidence” that department stores can “transform and be inspirational to customers”, something competitors have been successful in doing.
“Our international peers have responded to disruption by leading in omni-channel, by reinventing the in-store experience, overhauling the range, and by differentiating through innovation,” Umbers said.
“Our new strategy to bring the love of shopping to life will be guided by a clear vision and a plan to win back market share, to respond faster to change and deliver a sustainable recovery in earnings.”
Umbers vowed that “new Myer”, under its new management team, will be repositioned as a “modern, inspiring department store”.
Key aims will include improved consumer targeting with “customer driven decision making”, the acceleration of an omni-channel strategy, better leverage of the Myer One program and a strong emphasis on brands in-store.
More details if the strategic review will be announced later in the year.
Steve Jones
Myer is a horrible place to shop.
1. Range dumbed down to masses of cheap, nasty, “high margin” private label junk and fewer quality brands.
2. Price overtly expensive compared to high street or online (same goods)
3. In-store experience poor – few staff, long queues, nothing innovative.
And that’s not even considering their poor online experience or any supply chain issues.
User ID not verified.
Agree – it hasn’t changed its look in-store forever, there are never any staff to help you, and I totally didn’t get their latest TVC (even if I am not the target)
User ID not verified.
Agree totally with Stevo…. Myer is simply a shortcut for me from the Carpark…nothing more.
The staff could’nt look less bored if they tried and the stock is presented poorly.
The fairly well presented Country Road concession @ Bondi Junction makes the rest of the store look like bondi markets.
Technology section is reduced to a few modern items & TV’s (all of which are overpriced compared to other stores).
I would love to take charge of their retail experience and drive some innovation! A kick up the arse of staff would be a good start!
Ditto. Haven’t darkened their floors in a decade.
User ID not verified.
Could have told them that years ago when I moved back from the USA. Both Myer and DJs are way behind in terms of online shopping and many other customer service experiences. I can buy something online from the US, get free shipping (yes, I know, there’s no such thing ;)), and have it delivered before something I buy online here has even left the warehouse.
They both need to take a leaf out of the book of Nordstrom.
User ID not verified.
Remember the days when a Myer voucher was an acceptable gift / corporate reward?
(vomit)
User ID not verified.
Myer is only alive because of life support.
Time to turn that off.
User ID not verified.
So Myer has ‘failed to keep pace and lost relevance with rivals’ says the New CEO.
Why promote the Marketing Chief ( who may have had some responsibilities with the above stated failures ) to the new deputy CEO.??.
Nothing new here.
User ID not verified.
Myer has, for the last few years, been all about “cost control” and “margin improvement”, translating to staff cuts and a plethora of shitty “private label” goods. Thank the beancounters for that.
In the last year they’ve tried to improve staff service levels, but I fear it’s all way too late.
Promoting the Marketing Director is probably a good idea.
User ID not verified.
Myer did very well a few years ago when you could purchase $5000 or $10,000 of shares and you were issued with a discount card which was very useful. Myers has the customers investment and customers have dividends plus discount everybody wins.
Why not revamp this idea.
User ID not verified.
Wow! I thought that I was the only one who felt bad about Myer, but I see all my opinions and feelings expressed above.
Yes, they need to implement a “youth card” system, and a card linked to an investment incentive, but they also need to advertise a new approach to an old idea without announcing it as a new approach. The idea is lurking somewhere in the redefining of reality/ virtual reality, (hint) interfacing with reality :o).
The most vital step required, is a system of staff training, as the service has become almost non existent, and I have personally experienced Myer staff who down cry the store (yes, bite the very hand that….) which surely tells you that , for some reason/reasons, they are not happy.
User ID not verified.
You are failing big time, been building up for 15-20 years!
Your reputation was built on exceptional customer service
However 15-20 years ago your top people decided to adopt the stack it high and watch it fly ( your customers did not want an expensive Kmart) !
The same people wanted staff to be adaptable to work in areas they had no interest or more importantly training in ( cosmetician constantly rostered in places such as pots and pans or sheets and towels ! Fine to be adaptable but each area should have knowledgeable,trained enthusiastic staff,it was like your top advisors were totally indifferent to your customers needs and wants and your staff ( who are at ground level and actually know the facts of needs and wants of these important customers who keep your company going! )
Then further lack of respect to staff it’s decided family,lifestyle,work balance does NOT count, you MUST work weekends no choice ! Even though there are different needs , some staff have university, some have young families, some need to fit in with other family needs ( the elderly, the sick, special needs relatives ) at least listen and adjust where possible. Well known is happy respected staff work better and are happier when respected .
Constantly having sales ! Please make a sale special an event !!
I could go on but you aren’t listening anyway
What a shame
User ID not verified.