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Arcadia shuns value to move upmarket

Sir Philip Green is shaking up his Arcadia Group brand portfolio as part of his strategy to shift away from the price-driven value market.
The most dramatic change is at the group’s Dorothy Perkins chain, which is distancing itself from value rival Primark by moving into the middle-market territory for spring 08. The move will see Dorothy Perkins pitching itself head to head with rivals Next and New Look.

The revitalised Dorothy Perkins chain is introducing better quality fabrics to its offer, including 100% silk dresses and leather-lined footwear.
Sources at Arcadia’s press day, which was held in London last week, said the chain was refocusing on a core customer group aged between 25 and 40. “We have been serving too wide an age range and need to hone down our target shopper,” one source close to the company said.

Green told Drapers that it was important that Arcadia’s 2,000 shops did not look the same. He said: “All of the businesses need to be a little bit more aspirational and inspirational. I’m bored of a price market. People want to buy nice things. It’s not about going upmarket, it’s a question of selling a clear identity.”

Alongside changes to product, the Dorothy Perkins store merchandising model will be completely overhauled to support the shift upmarket. It will spread its fashion-led lines throughout the store, rather than offering a small section of key fashion items at the front of the shop.
The famous Dorothy Perkins wall of jersey will also be diluted.

A source close to the retailer said: “It makes sense for the brand to distance itself from players such as Primark and move away from the bottom end, where there is no real volume and margin to be had because of all the competition. It’s a migration towards a different way of competing.”

The source added: “Arcadia is looking at the balance between block departments and co-ordination in-store, and it is moving towards the co-ordination of product on the shop floor.”

Arcadia stablemate Wallis has also repositioned for spring 08. Its offer at the press day was dominated by high- quality occasionwear.
The source added: “The Wallis [collection] is also symptomatic of the need to shift to the upper end of the market. Its proposition at the moment is pretty safe, but next season is an expression of how the brand is gaining in confidence.”

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