eCommerce & Multichannel Strategist and Business Mentor
The power list — the top 50 in retail in the UK. It’s worth looking beyond the headline for starters. I read this trying to understand what makes these people head up the power list in retail — it left me asking, what is this perceived power and how does it manifest itself with a solid strategy. In fact, it does neither in my opinion. The devil is in the detail. Some facts I picked out:
5 Sainsburys management involved — all with different roles in their online strategy, all seemingly differing remits to the same goal. Not sure they will all be there next year. Go figure.
5 of the key strategies were to merge/takeover a competitor and it wasn’t to gain competitive advantage. Rather, it was to absorb a key piece of tech/infrastructure they could not implement themselves or simply to buy market share.
6 of the 50 are marketplace execs (12%) — excluding Jeff Bezos, who is in his own category. eBay/Amazon and Farfetch provide scale and access to markets which not all of these retailers fully embrace or know how to utilise. In a saturated market like the UK, these vehicles need to be used, and quick to gain a foothold abroad.
4 Strategies involve moving to at least a same day service with Majestic wines hoping to deliver within the London area within 20 minutes ! Not even enough time for a bottle of rouge to breathe. If I were the logistics partners, I would be nervous.
2 non retail people. Facebook and Google execs stamping their authority on how vital a rounded customer experience now needs to be. A key point worth remembering is we are not just selling to today’s customers, we need to engage in the next wave. (I’m avoiding using the mil******* word).
Jack Ma was in at number 2 last year, just cos? Down 12 places for no real reason. Sainsbury’s dipping their toes in the water and others may follow. There are many other brands/smaller retailers already involved in selling via this behemoth and will be interesting to see who comes out of “Singles Day” this year with stories to tell. Considering there was $14.3B traded in 24 hours in November last year.
1 company with 2 very clear strategic tenets that all online retailers/manufacturers too should consider and this is made.com. Combining a beautiful site with superb content, amazing product and a strong experience, they identified the best routes to profitable expansion — open new territories — 30% of their sales came from 5 new countries — not much complexity with data here, replicable model — (see also WiggleCRC for brilliant execution) and their second and most critical tent is “cut the middle man out” = margin wins and greater profitability and scope to expand. A simple but brilliant model. Underpinned by years of solid investment in the right customer centric tools, now has led to b/e point and profitability to follow. Their competitors will struggle to replicate this. It is a sector with limited competition for now.
Only 1 mention of an automotive company and I use the term lightly. LQK group who own Euro Car Parts will surely not mind not being mentioned but their domination of the UK car parts scene has long since been the envy of many a retailer, though their low price model will come under scrutiny, but then buying the supply chain as they did last week, surely means bottom line gains for this giant.
The lack of representation by traditional high street brands is maybe not surprising. There is a sales versus experience argument to be had — look at Burberrys, I hear you say, but with some key departures and a tough year, they will need to supplement the style for substance you would think. The rise of misguided and boohoo suggest theASOS model is replicable and has left room for people to play and all to share in the profitable pie, while building a new customer base — tomorrows sales today.
3 people with titles including the word customer suggests a shift in focus and it stands to reason that those who know the customer best can strategise with the greatest knowledge and certainty when brought in at the right level/time.
Finally, of the highest risers, there are 6 of the 9 mentioned are pureplay retailers, not including JB. The ability to understand the landscape but also the ability to shape trends and appeal to the right types of customers make these types of company best suited to start dominating this list even more. I expect to see AO.com further up the list in the coming years. And should Primark ever take the unprofitable plunge, it would worry the high end retail guys.
I would love to see this mapped against the key top 50 in retail tech and see how/where these is crossover. We see trends and nice to haves, but it’s the seemingly banal things like frictionless payments (enter stripe), better mobile optimisation, clean data and superior customer service that continue to dominate the landscape. In store tech/delivery will continue to thrive but watch closely for the rise or vertically based commerce. The advantage or pureplay in this space is:
- The ability to work with a narrow product set
- Build a community base
- Market to them cheaply and effectively
- Reward, retain and delight them through simplicity and convenience
I am sure the list will be of interest to some and for most, it probably doesn’t matter but with a little digging and sometimes, thought, there is gold in them thar’ hills!
Original Arrticle here — Retail Week http://guides.retail-week.com/etail-power-list-2016/etail-power-list-2016/4332.guide
For a more interesting list, look to the ones to watch list. That well known retailer “Uber” is in there ! Enabling ecommerce it will do as Yoda would say.