Shoppers flocked to buy online from John Lewis this Christmas, with four in 10 of its sales over the period taking place over the internet.
Online transactions at John Lewis [IRDX RJLW], an Elite company in the IRUK Top500 research, were up by 21.4% in the six weeks to January 2, compared to the same time last year, parent company the John Lewis Partnership reported in a Christmas trading statement this week. Of those ecommerce sales, 35% were collected from Waitrose branches. Mobile was the fastest-growing channel, with sales from smartphones and tablets up by 31%. Sales through click and collect were up by 16%, accounting for half of all online orders. At sister company Waitrose [IRDX RWAI], a Leading retailer in the IRUK Top500, meanwhile, online sales were up by 7.9% over the period, and up by 9.8% over the Christmas and New Year weeks.
Overall sales reached £1.8bn across the partnership over the period – that’s 4.1% up on the same time last year. While John Lewis’ gross sales reached £951.3m, 6.9% more than last year and up by 5.1% on a like-for-like basis that strips out the effect of store openings and closures, those at Waitrose reached £859.8m, 1.2% up on last year, but down by 1.4% on a like-for-like basis.
“Our performance reflects to a large extent the significant investment we have made in our distribution and IT capability,” said Sir Charlie Mayfield, chairman of parent company the John Lewis Partnership. “Despite the fact trade was even more concentrated across a number of very busy shopping days, our operations performed especially well.”
John Lewis said patterns of trade had shifted over the period, with peaks around Black Friday, Christmas and Clearance. Each had higher sales than at the same time last year, with different mixes of channels for each – Johnlewis.com came to the fore over Black Friday, for example, while Waitrose stores saw footfall climb in the days immediately before Christmas.
“The combination of our shops, website and fulfilment centres worked together effectively,” the partnership said in the trading statement. “For example, on the Black Friday weekend our distribution teams processed 18% more parcels than last year, which equated to five units per second during the peak hour. Sales in our shops for the total six week period were down 1.2%, reflecting lower footfall pre-Christmas, but were up 16.2% during the first week of clearance (week ending 2 January).”
Commenting on the results, Tristan Rogers, chief executive of global enterprise collaboration platform Concrete, said: “John Lewis’ online presence clearly paid off over the Christmas period, with a 21% uplift in trading over the same period last year. With in-store sales down 1.2%, it has managed to capitalise on the growing buying habits of British consumers to shop online.”
But, he added: “One of John Lewis’ USPs is quality customer service and in-store excellence – how can this be translated effectively online and how will it differ from other pure play online vendors? Would it not be prudent to re-invest a portion of the £500 million intended to revamp its online offering into even better in-store experience? Such an approach is a differentiator to pure play ecommerce vendors, and allows John Lewis to engage customers in ‘showrooming’ and ‘clientelling’. John Lewis store revenues may be down 1.2% year on year, but they are still the lion’s share of the company’s revenue.”
Hannah Maundrell, editor-in-chief at www.money.co.uk, said: “John Lewis is showing other online retailers how it should be done; their tempting combination of a slick shopping experience, competitive pricing and top notch customer service clearly gets shoppers’ juices flowing.
“By guaranteeing they would match all prices on Black Friday, shoppers put all their money into the John Lewis pot because it was easier than shopping around. Their never knowingly undersold promise is proving so popular that it’s a wonder any other retail websites ever get a look in.”
Image: John Lewis’ new Birmingham flagship store