“There’s no other store like David Jones.”
… or so an old jingle said on David Jones’ ad. One of the biggest news stories in Australia this week is the downfall of David Jones – an upmarket department store. In its 188 years of existence, it survived two World Wars and the Great Depression, but ultimately it just couldn’t cope with the changing competitive landscape in Australia.
For those who are not familiar with the brand, David Jones is similar to Bloomingdale’s in the US or John Lewis in the UK. However, unlike the two department stores, David Jones entered into voluntary administration on 5 November. It failed to negotiate better terms with the landlords, with some reports stating that the department store chain had not paid rent in some locations from October. This development had been happening for a few years – they reported a loss of around $95.5 million in 2024-25, after a loss of approximately $74 million the previous financial year.
What went wrong?
It’s too simplistic to say that David Jones just failed to keep up with online shopping and the evolved market competition. Surely there are some bright executives and leaders who could have done something about the business or the brand?
I know that there are countless folks who offer solicited and unsolicited analysis and opinions – mine is just one of the many. So, let’s dissect this through the lens of marketing science, which may help explain some of the factors behind David Jones’ difficulties.
Rather than asking your golden goose to cough up more eggs, get more geese.
To grow brands, ensuring that the brand is fresh in shoppers’ mind (“mental availability”) and making it easy for shoppers to shop in any way they prefer (“physical availability”) is paramount. With its network of stores across Australia and its online shopping platform, David Jones certainly has substantial physical presence. One potential contributor is the tendency of businesses under financial pressure to prioritise ROI through marketing activities that deliver readily measurable short-term returns. Direct marketing to existing customers can appear particularly attractive, but it risks neglecting the continual acquisition of new and occasional buyers. I cannot recall any large-scale, mass-media advertising for David Jones in recent years outside of Christmas and Mid-Year sale. The YouTube clip I put in this post was aired in 1999. On the contrary, I have received emails from David Jones, Myer (their competitor in Australia), and numerous retail chains and boutique stores.
In their effort to maximise ROI, they try to milk more from those who know them rather than trying to get more buyers to shop from the brand – either for the first time, or at least try again for their second, or third time. When brands concentrate their advertising on narrow, existing customer segments, they risk neglecting the much larger pool of light, occasional, and potential buyers needed to sustain growth. What about the millions of Australian residents who were not familiar with the brand?
It was refreshing for me when I saw an ad for Nordstrom when I was in the US earlier in October. It wasn’t particularly close to Black Friday, Christmas, or even winter shopping – so their effort to keep the brand fresh in shoppers’ minds is very much in line with the growth framework.
Nostalgia keeps memories alive – but does it keep the tills ringing?
Watching the news coverage, I was struck by how many people reminisced about visiting David Jones as children, particularly at Christmas — or when they were younger. These memories are undoubtedly precious, but they raise an uncomfortable question: when did these people last actually shop at David Jones?
There is also nothing comparatively ‘different’ when shopping in David Jones than if you go to Myer, or say, Bloomingdale’s in the US, or John Lewis in the UK. David Jones was famous for having a piano in the middle of the store with elegant and attentive sales assistants. In the last couple of years, you would be lucky if you could find somebody readily the moment you needed help.
My concern is that David Jones may have failed to build sufficiently broad mental availability among generations of shoppers. Younger consumers have grown up with a much wider range of shopping options, and David Jones’ heritage alone may not be enough to make it a brand they think of when a buying need arises. Younger shoppers grew up with the ease of shopping online – and thus, David Jones’ presence online is merely one of the brands or sites alongside boutique chains, Shein, and other competitor brands. It cannot show off the heritage nor the assumed luxury it so relies on in the brick-and-mortar store.
Focus on the Everyday – not just the Heyday.
Admittedly, I step into David Jones only after Christmas when I am on the hunt for discounted Fortnum & Mason biscuits. For me, one of the few Category Entry Points (CEPs) strongly associated with David Jones is “When I’m hunting for discounted Christmas treats”. That’s a remarkably narrow association for a retailer that sells everything from cookware and luggage to clothing, cosmetics, and homewares. Category Entry Points are the thoughts that consumers have in relation to a particular category, that shift them from a bystander to a potential category buyer. Ideally, David Jones should have many CEPs linked to the brand all year round — and not just for the high seasons like Mid-Year Sale, Black Friday, or Christmas.
This is also likely to be the reason shoppers would consider going to other online sites or stores that are more mentally available when they have category needs. The popularity of Kmart in Australia is an example of this. They actively advertise all year round for a wide range of shopping needs that make shoppers associate many CEPs to the brand.
“But, but, but … surely you cannot compare Kmart to David Jones????”
Well, why not? Shoppers need to buy a replacement cooking pot, a large or smaller suitcase, or something unceremonious like extra underpants. When David Jones is not considered for such needs and only thought about in relation to Christmas and Mid-Year sale, then no wonder the brand suffers.
It does not mean that David Jones should cut their prices and compete directly with the likes of Kmart. When I am looking for good quality brands like Samsonite, Tefal, Bosch, Rodd & Gunn, Country Road, ideally I should also consider David Jones as part of the stores or the websites I visit. These brands are not sold in Kmart.
David Jones may have survived two World Wars and the Great Depression, but history and heritage alone cannot guarantee its future. Shoppers may have fond memories of a brand without remembering to buy from it. The lesson here isn’t that department stores are obsolete. Bloomingdale’s and Nordstrom demonstrate that the format can still have a place in modern retailing. The challenge is to remain relevant and mentally available across the many ordinary shopping occasions throughout the year, not merely the special ones.
When businesses do not understand the vital role of penetration, and managing mental availability and physical availability — and only focus on ROI and maximising returns, I’m afraid there will be more stores like David Jones heading towards a similar fate. After all, a brand cannot survive on memories alone. It needs buyers, including those who have yet to make any memories with it.