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Primark's showdown on Oxford St

Can the value giant's new London flagship help it square up to the UK's biggest fashion players?

Primark's new flagship store on London's Oxford Street opened last week amid scenes of hysterical shoppers, road closures and police on horseback. But beyond the hype, the store is more than just another opening; it represents the chain's move from value retailer to a serious rival on the fashion scene, as it ups the ante with a revamped store design.

Traditionally thought of as a bargain bin, Primark's most recent opening - with its wide aisles, branded layout and sexy lingerie department - is a million miles away from its conventional no-thrills store concept. Dalziel & Pow, which designed the new store, says Primark is stepping up a gear with the concept, which is designed to look more fashionable through stronger branding.

Karl McKeever, brand director of visual merchandising agency Visual Thinking, says the strategy is a sensible one if Primark is to be taken seriously on Oxford Street. "Womenswear is a competitive battleground for fashion retailers, so they have to up their fashionability. Store design is one way to do that; something that New Look has done very well. You can't just compete on product any more. Customers have expectations - they want to feel turned on by the stores they visit."

Industry insiders who have visited the store say the likes of New Look and Marks & Spencer, both neighbours on Oxford Street, will raise their eyebrows at the new design, which has elevated the store to compete with its rivals.

However, Peacocks chief executive Richard Kirk, who concedes that the store will pull in the crowds, is unconvinced that it will have the same appeal as New Look. He says: "Upping the fashionability is the right idea for Primark - it will draw a lot of shoppers to that end of Oxford Street. But I don't know whether the new design will lift it to the level of New Look or Marks & Spencer. Neighbouring retailers will still be worried because Primark has so much appeal, but its success is driven by volume and low prices."

One rival fashion chain director thinks getting the product mix right is a higher priority for Primark than store design if it is to become an Oxford Street contender. "When I go into most Primark stores, after getting past the first row of fixtures the rest of the store is a mess and the product is less impressive and less fashion-led. For Primark to become a real fashion player, it needs to get its product mix right and create an environment to support it. I think it gets a disproportionate amount of fashion PR coverage at the moment, but I'm curious to see the Oxford Street store for myself."

Its location on the UK's prime shopping street could lead some customers to believe that the retailer is moving away from bargain prices, with a new-look store signalling higher price points. Kirk thinks such a perception may not be so far-fetched in the future. "At the moment Primark is at the top of its game, but we might see a change in strategy in time," he says. "I wouldn't be surprised if it raised its prices."

But Raj Wilkinson, joint managing director of design agency JHP, says the retailer should stick to what it does best. "I don't think Primark will nor should raise its prices - low prices are part of its USP. Shoppers may assume prices have gone up if the interior is radically different and more fashion-led, but every brand needs to step up a gear to be on Oxford Street. Primark has already proved it can."

WHAT THE SHOPPERS THOUGHT ...

NAME: Amanda Mills

AGE: 26

OCCUPATION: PR

PURCHASES: Blue coat

SPENT: £15

"I was just passing but I knew the store was opening today - there's a coat I've wanted for a while, which I bought. It's similar to the shop in Hammersmith, but will be a great draw for this end of Oxford Street."

NAME: Annie Robinson

AGE: 15

OCCUPATION: Student

PURCHASES: Bag, two tops, washbag

SPENT: £18.50

"I came with friends and we were here soon after 9am - we were up at about 6am this morning getting excited. I usually shop in Primark so it was great to see more of the clothes I love."

NAME: Josepha Reynolds

AGE: 16

OCCUPATION: Student

PURCHASES: Bra, four tops, underwear, bag

SPENT: £38.50

"I spent more than all my friends, but still got all of this for under £40. The size and volume of stock mean I would definitely come back to this branch again."

NAME: Katie Callaghan

AGE: 21

OCCUPATION: Student

PURCHASES: Two satin dresses, pair of flip-flops

SPENT: £22

"I'm not as impressed as I thought I'd be. It's too much hassle compared with popping to my local store. I'm worried that now it's on Oxford Street, everyone will be wearing the same thing."

NAME: Leila El-Alami

AGE: 17

OCCUPATION: Student

PURCHASES: Two tops, scarf, belt

SPENT: £31

"I didn't think it was any different to any other Primark, except it's bigger. The clothes are cheap, but when the novelty wears off, people will realise the quality is lacking."

NAME: Ruben Lourenzo

AGE: 16

OCCUPATION: Student

PURCHASES: Jumper

SPENT: £6

"I came for the opening because it's important for guys my age to get decent cheap clothes. I normally shop at JD Sports, but the price is a real draw at Primark. It's so huge that there's plenty of choice."

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