Homebase to step up multichannel focus this year

A new website and the launch of new mobile apps, as well as trials to further drive customer loyalty, all feature on DIY retailer Homebase's to-do list in the coming year.

In a full-year results statement published on Wednesday, the retailer's parent company Home Retail Group said that "step changing multichannel is an important part of the Homebase strategy" for the 2014-15 financial year, as the business looks to continue its recent sales growth journey.

Total sales at Homebase for the 12 months to 1 March 2014 were £1.49 billion, with like-for-like sales growing by 5.9% compared to last year. Multichannel sales jumped up 53% year-on-year to represent approximately 7% of the retailer's total revenue. 

Homebase said that the growth in its multichannel sales was driven by increased investment in the online channel as a route for customer acquisition, as well as the introduction of improved delivery options. The new fulfilment options include either a standard three-day delivery basis or a next-day or named-day offer to home or store, with good levels of uptake having been reported to date.

The retailer has also now brought Wi-Fi into all of its stores, enabling customers to browse and shop whilst shopping and allowing Homebase colleagues to assist them using the internet. The next stages of the Homebase digital journey will see the launch of a website with improved search functionality, registration and login that will offer customers a more efficient buying experience.

To support the new site, Homebase will also be rolling out new Apple and Android mobile apps.

At the start of April, Bertrand Bodson took on the role of chief digital officer for Home Retail Group, following nine months as digital director of Homebase's sister company Argos. Now looking after the entire group's innovation strategy, there will inevitably be plenty of opportunity for the cross-sharing of ideas between the Argos and Homebase brands.

Indeed, Matt Piner, research director at retail industry analyst group Conlumino, said that Homebase is already benefitting from the experiences of Argos, which continues to be seen as an innovator in the digital retailing space.

He explained: "Although online isn't as significant a factor in DIY and homewares as some other areas of retail, consumers are still increasingly looking to the internet for research and inspiration as well as purchasing, and so it is right this is an area Homebase invests in."

As a long-term member of Aimia's Nectar programme, Homebase has often been at the forefront of developments in the area of customer loyalty. The DIY retailer said today that it has a database of approximately 7.1 million active Nectar customers, with the Nectar card used on around 65% of sales.

Using this data to tailor Homebase's marketing strategy is currently a key focus for the company, as it is for many businesses operating in the retail space. During the last financial year, Homebase sent around 37 million direct mailings and around 28 million emails to drive relevant offers to customers, while individually tailored coupons issued at point of purchase are now being trialled to drive higher levels of repeat sales.

When incorporating Argos's annual sales of more than £4 billion, total group revenue increased 3% to £5.66 billion for the full year.

CEO of Home Retail Group John Walden (pictured above), who assumed the lead role at the company following the recent departure of long-serving boss Terry Duddy, was positive about the full-year results.

"The group has delivered a good performance in what remained a challenging market," he said.

"Both retail businesses recorded positive like-for-like sales for all four reporting periods, resulting in 27% growth in group benchmark profit before tax. We also made good progress with our strategic plans in both businesses, which will become increasingly important in a competitive retail environment where shopping behaviours are changing rapidly."