They have often been labelled the pick of the bunch when it comes to discount furniture companies. DFS has a long established history for profitability and it has seen them create a loyal customer following in the process. The company first issued DFS shares back in 1993 and quickly became many investors’ top pick. However, after several years it was clear that DFS shares weren’t fully living up to their potential. These worries were eventually confirmed when profits dipped through a lack of direction and DFS shares left the stock market in 2001. After an absence of almost a decade, under new ownership, DFS shares returned to the stock exchange in 2015, but once again there was little or no fanfare upon their arrival. So the big question is, what is holding DFS shares back?
Are DFS a well-known name? Yes. Do DFS deliver consistent profits? Yes. Do DFS have an image problem? Sadly, the answer to that is also yes. Nick Bubb, a leading retail analyst dubbed the DFS brand as lacklustre and stated that it should stand for “Dull Furniture Sale”, and it seems that there are many investors out there who agree with this view. While DFS have proclaimed that they are happy with how the IPO has unfolded, declaring it a success, in reality is hard to spin the 255p launch price as such. DFS to investors comes across as a brand that is going to deliver big, in fact the viewpoint is one of stagnation, as no dips are expected but neither are any big gains. If DFS shares want to impress, this is a tag that they must shake.
Another bone of contention for investors is the marketing involved when it comes to DFS. While the “cheesy” and “hammy” approach to advertising was successful for DFS in the late 1980s and early to mid 1990s, it has since become dated. The days of Tony Adams reading out the names of local DFS stores is something that those who own DFS shares don’t want to see again. Arguably the poor nature of DFS marketing came to ahead when they were sanctioned by the Advertising Standards Agency. Viewers had complained that the company had visually doctored images of furniture to make them look bigger than they actually are. While the advert itself was considered one of the worst of all time as it was, it was quickly pulled from air. If DFS shares want to grow, then DFS as a company needs to bring its marketing campaigns into the 21st century.
DFS shares are a stock with great potential, but potential isn’t always going to be enough to get investors to part with their money. There are clear and obvious problems that are holding back DFS shares, but they aren’t problems that can’t be fixed. Should the company try to establish a few image tweaks and shake loose its cliché 1990s inspired ad campaigns, DFS shares could be a stock to watch in 2015 and beyond.
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Alexander Bowring is a London based writer and a Southampton Solent University Screenwriting graduate. He has worked alongside TV personality and Telegraph feature writer Alison Cork, whilst also having produced content for ITV, This Morning, Canvas8, Who’s Jack, Alison at Home, and Bonallack & Bishop Solicitors. Alexander also has a keen interest in investments.