By Patrick Avenell
JB Hi-Fi is winning the ‘omnichannel’ war and, as a result, its share price is underperforming on the Australian Securities Exchange, according to analysis by Grant Saligari and James O’Brien from Credit Suisse.
Over the last 18 months, the major public retailers have consistently announced online and mobile selling strategies, abstractly dubbed the ‘omnichannel’, which have mostly been unconvincing, according to experts.
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Following its encouraging profit forecast released last week and the launch of JB NOW Books and Video to complement Music, Credit Suisse has given a positive appraisal of JB’s online operations.
“JB Hi-Fi appears to be having some success in expanding online sales,” wrote Saligari and O’Brien. “During the first three months of calendar 2013, Nielsen data is showing its unique audience is up 19 per cent year-on-year and conversion rates steady at around 8 per cent.”
Maintaining a stable conversion rate while increasing traffic means JB Hi-Fi’s online sales are growing, as is its comparable in-store revenue, which is up 3.3 per cent for Australians stores.
While rival retailers Harvey Norman, The Good Guys and Betta Home Living focus their online sales on selling core categories in a digital environment, JB Hi-Fi has expanded into soft sales, which don’t require stock holdings or physical delivery costs. JB Hi-Fi has also experimented with parallel importing, supplier runouts and exclusive lines.