Dixons: disappearing from a store near you. Photograph: Ian Waldie/Getty Images
Dixons, the high street electricals retailer, is about to disappear from the high street as it turns itself into a company that will sell digital cameras and flat screen TVs solely on its website.
The company that began life as a single photographic studio back in 1937 insists that it is making the move to a pure online player from a position of strength. The figures tell a different story.
In its trading update in January, DSG, the owner of Dixons, reported that same-store sales at Dixons were down 2% for the year. That came on top of a decision two years ago to shut down some 100 loss-making stores, slashing its presence on the high street by a third.
But DSG gave no inkling in January that it was about to turn Dixons into a pure online retailer. At the time, DSG said it would pursue a new strategy to position Dixons as the principal high street source for new digital technology under the slogan The Future for Less.
So the decision for Dixons to quit the high street altogether is quite a turnaround - although existing stores will not be abandoned but converted to the Currys brand. Besides Dixons and Currys, DSG also owns PC World and The Link, the struggling mobile phone chain.
Dixons' move is the starkest indication yet of the pressure that high street retailers feel from their online rivals, Amazon being the most notable. As the Office for National Statistics tells us, although overall consumer sales are flagging, online sales are booming.
Dixons itself has seen a 50% rise in online sales ever year in the past four years, although this must have been from a low base.
The move from bricks and mortar to cyberspace will bring new challenges. Customer service is a regular bugbear for clients who deal with online retailers. There are plenty of stories of frustrated customers hanging on the phone for ages when dealing with e-tailers, although the same can also apply in spades to physical retailers. Dixons will have to make sure it has the staff to deal with queries and complaints or its online venture will run into trouble.
Some companies have realised that a presence on the high street has its benfits. HBOS, the merged Halifax and Bank of Scotland, last month announced plans to embark on one of the largest branch expansions since the 1970s. At a cost of £100m, HBOS will open 50 branches over the next five years and move another 50 to better locations.
After extensive research, the mobile phone company O2 discovered that, above all, customers wanted to hear a human voice when they rang up with a problem. O2 also concluded that a high street presence was useful, not just in boosting "brand awareness" but because people liked to walk into shops as well as doing business online or over the phone.
Dixons is taking some risks by abandoning the high street altogether. Amazon has shown that it is possible to succeed by avoiding bricks and mortar altogether, but Amazon is a rare case.
