Independent agency Krow won the busness after a final shoot-out against Karmarama. The retailer kicked off the review in August and the pitch process was handled by the AAR.
Ogilvy & Mather and VCCP were knocked out of the process at an earlier stage.
DFS, which has 80 stores nationwide, has previously focused its advertising on tactical promotional spots. However, in reaction to declining revenues, Ian Filby, the DFS chief executive, has signalled his desire to complement its price-led advertising with brand activity to attract a wider customer base.
DFS has used a number of regional agencies in recent years including Gratterpalm, Uber Agency and Public Limited.
Krow was launched in 2005 by Barry Cook, Nick Hastings, John Quarrey and Malcolm White. Clients include Fiat, Focus and Pets at Home but DFS represents by far the largest new-business win since it opened its doors.