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This week’s top stories in retail - October 21st 2010

by James Callander August 31, 2011

Retail Week

Sports Direct bonus scheme pays off

Sports Direct gross profit increased 5.4% TO £117m in the 9 weeks to September 26th, proving the pay-off from their new bonus share scheme. First half results are expected to be ’significantly’ above last year’s, however CEO Dave Forsey said that he expects early 2011 to be tough for all retailers. The Board believes that the bonus share scheme has been an important contributor to the brand’s strong performance, and a new scheme is expected to be implemented to cover the next two financial years.

New Harrods owner considers rooftop hotel

Following the store’s acquisition by the Qatari Royal family, Harrods is considering opening a luxury rooftop hotel above the iconic Knightsbridge location. The move comes as part of a wider review of the business and is one of several ideas being considered. The plans could also include a top floor restaurant.

Mothercare international sales ahead of the UK

Overseas sales at Mothercare have overtaken those in the UK for the first time in its first half. With 1217 stores worldwide in 54 countries, including 800 stores overseas, Mothercare expect to open another 150 stores overseas this year. As well as rapid international expansion, sales in the UK Direct and Wholesale businesses have delivered excellent growth in spite of the uncertain retail environment.

The Grocer

Clubcard points lose value with Tesco partners

Tesco has confirmed plans to cut the value of Clubcard points with partner organisations to keep its double points push “sustainable’. From December, vouchers earned via the loyalty scheme will now be worth three instead of four times their face value at partners such as Thorntons, Pizza Express, Fitness First and Cineworld. Currently the vouchers can be redeemed at four times their face value. Tesco said the move was necessary to ensure the viability of its double points push, which it unveiled in August 2009 as part of the £150m re-launch of the famed loyalty scheme.

Watchdog bans Hestons’ ‘happy pigs’ ad

A Waitrose advert starring Heston Blumenthal and some “happy pigs” in Norfolk has been banned for misleading consumers over the living conditions for the animals reared on its farms. The Advertising Standards Authority upheld viewers’ complaints that the term “outdoor bred”, used in the advert, misleadingly suggested the pigs spent the majority of their lives outdoors. In the advert, Blumenthal was seen discussing with farmer Phil Ellis the living conditions of breeding sows, rather than pigs used to produce pork directly. Waitrose argued that the term “outdoor bred” was commonly understood but the complaint was upheld and the advert banned.

Sir Terry sells Tesco shares worth £3m

Sir Terry Leahy has reduced his stake in Tesco, as the supermarket continues to prepare for life after its long-serving chief executive. The retailer’s boss has sold shares worth £3.3m, according to The Times. Despite the sale, he still holds stock worth almost £37m. Shares in the UK’s largest supermarket have risen by 14% in the past three months. News of the sale comes just months before Sir Terry hands over the reins to Philip Clarke. He will leave the business in March after 14 years at the helm.

Marketing Week

Marmite is partnering with Selfridges to bring back its pop-up stores

Marmite is opening four of its pop-up stores in London, Birmingham, Manchester and Trafford Selfridges which will be open in the run up to Christmas. More than 150 Marmite themed products from t-shirts, tableware, stationary and fashion accessories will be available, as well as selling Marmite Chocolate and hosting Marmite inspired events including VIP breakfasts, book signings and a Marmite love/hate photo shoot. The pop-ups follow a “Marmite shrine” was revealed in Burton upon Trent earlier this week.

Debenhams profit up as it boosts fashion

Debenhams is launching a new designer fashion concept called Edition to build on its own brand fashion offering, as it reports an increase in full year sales and profit (pre-tax profit increased 20.3% to £145.3m in the year ending 28 August). The launch of Edition, which will include fashion collections from designers Jonathan Saunders, Preen, Jonathan Kelsey and Roksanda Ilincic, is the next step in Debenhams’ strategy to shift its focus to own bought product ranges to boost margins. Rob Templeman, chief executive of Debenhams, says: “We will continue to focus on our core strategy of self-help initiatives focused on managing gross margins, driving market share and growing through expansion and investment.”

Wilkinson Sword readies £20m Hydro campaign

Wilkinson Sword is launching a television campaign for its newly launched Hydro razor range as part of a £20m marketing investment in the brand, which it claims is its “biggest ever” marketing spend. The ad builds on Wilkinson Sword’s ongoing strategy to use metaphor to demonstrate the product benefits. Wilkinson Sword says its “engaging and entertaining” ad aims to break away from traditional ads in the shaving market that drive a purely functional message. Wibke Stoffers, marketing manager of Wilkinson Sword, says: “Excellent in store visibility and strong promotional offers are set to convert mass awareness into mass trial.”

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