THG Ingenuity was already all set for this week’s cyber trading activity when InternetRetailing spoke to Vivek Ganotra earlier this month. This is Ganotra’s first Black Friday at THG, which he joined in June as chief executive of THG Ingenuity – the division that works with retailers, brands an brand owners as diverse as Homebase, Matalan, Proctor & Gamble, Mondelez International, Nestlé and Coca-Cola to run all or part of their ecommerce operations. It’s a period he was already looking forward to. “There’s a lot of good preparation,” says Ganotra. “We’ve done all our checks, we’re ready to make sure that we are both on the technology side and the fulfilment side that we are actually ready for peak in terms of being able to, you know, sail our way through that and have a successful outcome. Yes, we’re all geared up, and really looking forward to it.”
Even as Black Friday gets underway, there’s a great deal of uncertainty about forecasts about how much shoppers will take part this year. E-tail trade association IMRG has predicted shoppers will spend 5% less this year than last, but also says there could still be growth this year. When InternetRetailing spoke to Ganotra he was prepared for a range of outcomes, given the current recessionary environment. “We’re prepared, is what I say. “How different it is going to be in terms of the mix, I’m sure there will be some positive surprises, some less positive, but that’s the same with everything. But I feel generally prepared as an organisation. Certaintly, for Ingenuity and a lot of our brands we’ve got some very, very clear ambitions for the week and beyond.”
Through its THG Ingenuity division, THG – The Hut Group – works with a range of brands that have looked to expand their ecommerce businesses in recent years, particularly as shoppers moved online during the pandemic. In doing so it has built on 17 years of experience in building online brands in sectors from beauty and nutrition to entertainment and gifting. Now it is providing that expertise to brands that are finding out how difficult it is to do direct-to-consumer ecommerce for themselves. In years of running direct-to-consumer brands, from MyProtein to Lookfantastic – THG has honed its expertise and use of automation in areas including fulfilment, says Ganotra – “our ability to do next-day delivery in the UK is second to none” – while it can also take away the pain for brands of recruiting dedicated ecommerce staff at a time of talent shortages.
“What brands are realising,” says Ganotra, “is while it’s nice to talk about multichannel and omnichannel, it’s hard to to really be able to connect the dots. All those capabilities require organisational change, require technology change, require incentives change, and the ability to curate data across all the channels. It’s actually really hard to do.” At THG’s own Lookfantastic brand, for example, “we can actually see the curation and application of data across the floor, and it will be on steroids during cyber week, where we are able to take data, analyse, pivot, and execute changes that continue to drive conversion through a day or the multiple times in a day.”
Brands such as Coca-Cola and Mondelez’ Toblerone are are trying new things with that data, experimenting with limited editions, personalisation, gifting and bulk buying. The point of doing so isn’t so much the revenue as the shopper insights. “This is the holy grail for consumer brands because what they’re now getting is very rich first party at a, real consumer insight that they would normally pay a lot of money and dollars to get.” He adds: “There’a real demand for a £5.50 Coke bottle personalised as a gift – physically personalised through our print-on-demand capability – through a curated end-to-end journey. I think it is an absolute winner.” He adds: “If I look at my forward pipeline almost every consumer brand is talking about doing more of this. These giants are operating in so many categories across so many markets, so for me this is a really important category.” The insights won as a result helps brands to allocate their marketing dollars – and also offer broader understanding of how shoppers how want to buy online, or across channels.
From speed to community: understanding shopper priorities
One key insight, says Ganotra, is that “shopping habits have kept tilting far more towards immediacy”. The company recently held a future commerce event where it investigated some of the key trends currently affecting direct to consumer (D2C) commerce. Ganotra cites Meta on the insight that shoppers can go from discovering to buying a beauty product within 30 minutes, while TikTok says “every single action needs to be more meaningful” in order to meet their expectations. What that shows in practice, says Ganotra, is the need for “brands to genuinely be present at every touchpoint a consumer wants to interact with you rather than you defining the consumer where they should go.” That means enabling customer journeys taking in social channels, live shopping events and more – while at the same time offering shoppers the ability to donate to a cause or an environmental action, such as tree planting – THG’s own approach – at the checkout.
“I think finding real actions in the the purchase process in the whole brand experience process to be more purposeful, to be able to express the values, I think is becomes really more relevant,” says Ganotra. “And again, I think this is one where brands are absolutely there in terms of wanting to do it. There are some huge brands that talk about sustainability. But if you actually, as a consumer, interact with those brands, you don’t actually see it day-to-day. And I think that’s where brands need to bridge the gap between talking sustainability and living sustainability on a day to day action. And those are the brands I think that will start to win a greater share.”
The final priority that Ganotra puts forward is the need for community, using influencers who feel invested with a brand and will take an active part in creating a community around it.
The need to commit
Ultimately, says Ganotra, “If you want consumers to take D2C seriously, you need to take it seriously. You need to make it a priority. What I feel right now is that the commitment to D2C doesn’t start at the right level in terms of allocation of resource and marketing and talent. And it’s often like let’s try something and see if that works.”
He adds: “You’ve either got to go all in and make it work or don’t bother. And I think that feels like an obvious truth, but one that, for me resonated a lot. And I certainly advocate this to many of my customers. Don’t go half hearted into real commitment and D2C. The prize is huge. But you need to actually commit. It’s about commitment of sponsorship, being able to break the silos inside an organisation to make D2C work, the commitment of the right SKU and assortment and, an execution and talent to make this effective.”
Just as working in partnership with commerce providers is key, says Ganotra, so too THG Ingenuity is moving towards growing its own ecosystem. From the new year it is to make its technologies fully headless on the front end. That will mean others can build on and incorporate its technologies into their own systems. “That’s us providing more options to brands and thinking about extended partnerships,” says Ganotra. Today, making ecommerce and multichannel work for both brands and partners is about “making sure that you think about your partners and the capability set and how they are stitched together, and how that manifests in terms of KPIs. The commercial outcome is really important.”
That’s all the more important at a time when shoppers are “increasingly demanding”, says Ganotra. “They have more choice, they are holding back on their spending. You have to be even more relevant, even more on top of your game in terms of making those offers in the right way, at the right time, which doesn’t come easily and means you have to dial up your capability.”
That may well lead, says Ganotra, to more brands and businesses choosing to share resources, even when they compete with each other. Already, he says: “Brands are actually saying, you know, what, it’s better to have more shared infrastructure, and share capital investment. So let’s talk about shared fulfilment. We can focus on energy, yes, we may actually be competing with each other in the front line – but actually, we could be sharing and collaborating much more on things like fulfilment, things like technology and infrastructure, because there’s no point in us all reinventing those capabilities. And I think that’s a, that’s a grown up conversation that I could see accelerating for the next six to 12 months. Because these are more board-level conversations, they can actually create win win in an environment where capital is very expensive to get access to. And if you want to still pursue growth, without trying to combat that, you’ve got to try and find creative ways to invest in capital across across other brands that might be in your same category or adjacent categories.”
Beyond this Black Friday it seems there are interesting times – and conversations – ahead for Ganotra and THG Ingenuity.