Clerys set to reopen and it's hungry for the fray
A catastrophic flood in July meant that Clerys had to pull down the shutters. Now, after a multimillion-euro transformation, the store will reopen on Thursday. Business editor Nick Webb got a sneak preview at the new store
THERE'S a small pop-up shop at the back of the Clerys department store on Dublin's O'Connell Street. It's a clever marketing gimmick to engage with customers as the store remains closed following the near-biblical flood that destroyed the innards of the listed building.
On the walls are post-it notes from customers, on which they have written their favourite memories of Clerys, which dates back to 1853. Visiting Santa is the most common one.
I remember the 'priest jumpers' in the basement; horrible acrylic sweaters with jaggedy stripes and swoosh patterns. Only priest or agricultural men of a certain age would be seen dead in them. These jerseys were the clearest sign that Clerys was stuck somewhere close to 1977.
Something clearly needed to give. In a way, the flood was one of the best things that could have happened to Dublin city centre. New Clerys owners Gordon Brothers have spent several million on completely overhauling and kitting out the shop.
Clerys was one of the world's first purpose-built department stores when it opened in 1853. It was closely modelled on the landmark Selfridges Department store on London's Oxford Street. The Guiney family took over Clerys in 1941 and traded very successfully for close to 70 years.
Sales approached €30m a year during the boom. However, the cliff drop of consumer spending and the need to restructure debt saw Clerys forced into receivership in September 2012.
'The store is upping its game on the food front'
The firm had racked up losses of €4m over the previous two years and bank debts of around €20m. Nevertheless, receivers Grant Thornton were able to do a deal to sell the store to Boston fund Gordon Brothers, which installed a new management team headed up by Dominic Prendergast, a serial retail turnaround specialist.
He helped fix chocolate shop chain Thorntons, as well as putting his mark on Jessops. The potential to revive the sleeping retail giant was enormous from the first day the management team walked into the store. The flood enabled them to turn that vision into a shiny metal and glass reality.
Prendergast takes me up to the second floor of the 120,000sq ft shop. This is where the flood water burst through the roof and cascaded down through each floor before reaching the basement. Giant insurer Allianz is footing part of the bill as the insurance claim comes good for Clerys.
The first impression of Clerys is that it's well. . . "wow". It's way, way brighter. And airy. Mind you, it's not jam-packed with shoppers. Yet. There's still plenty of work to be done before the reopening on Thursday.
But there's far more going on than just a lick of paint, according to commercial director Simon Smith. Retail is as much about psychology as it is about pricing. Sight lines are huge, he says.
"If you can't see through a door and you don't know what's on the other side, you are less likely to open it."
Being able to see the other side of the floor means that customers are more likely to go further around. And buy more. Clutter is also out.
There's also the lighting. The 'gangways' or main thoroughfares for shoppers are deliberately less well lit than the actual clothes or merchandise on either side. These get the full blast of spotlights in order to help lure customers to browse.
Clerys is also upping its game on the food front. The rather grotty cafe in the basement will become a smart diner, with the elegant tearooms also being upgraded.
Food is enormously important to department stores, according to Prendergast. It chips in more than 10 per cent of revenues and also encourages shoppers to stay longer in the store.
Gutting the inside of the building has also given Prendergast and his management time to reassess its customer base. The core Clerys customer had become a female shopper aged from about 60 to 80, according to Smith.
While these customers are still of huge importance, Clerys is targeting shoppers from 30 years and over. Clerys is going after families too. Twenty-somethings aren't a core department store customer – they tend to hunt in packs elsewhere.
Prendergast stresses that Clerys is a "value" retailer, although that remains to be seen. The new-look store is going to big up its brand offering. Carphone Warehouse is to set up a slick new technology store where technology and new gadgets will be sold like "fashion", according to Smith.
There is a churn rate of between "three and a half dozen" brands each year out of the 60 or so brands or concessions. Most of the well-known names will still be there but there will be a few surprises too.
Given its location on O'Connell Street, it was something of a miss that Clerys wasn't so hot for tourists. This is changing, according to Prendergast, with the addition of a new in-store heritage centre and high-end Irish crystal and jewellry. It's also going to be promoted more at the airports.
Spending several million euro on a mega-facelift is a real sign of confidence in an improving economy. Prendergast says that before the store closed, sales numbers were rising and trading was ahead of targets.
The retail sector has been pulverised over the course of the last five years.
The trend may just be changing, with latest figures showing that retail sales rose by 4 per cent in Q3 2013, the strongest quarterly increase since 2006.
The regeneration of Clerys gives Dublin city centre another major boost in its struggle with the likes of Dundrum shopping centre for customers. With Brown Thomas looking sharp and Arnotts potentially escaping from bank ownership, the city is fighting back.
Footfall is improving all the time. Consumer confidence will translate into improving sales. Clerys may have done the easy part.
They have built it. Now will the customers come?