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EDITORIAL The challenge of staying profitable in a season of peak discounts

Having an overview of business operations is important in challenging times. Image: Fotolia
In today’s InternetRetailing newsletter we’re reporting as retail profits are hit by challenging market. Shoppers are looking for discounts and buying online more often, both trends that dent profit margins. But we also report on retailers that are finding ways to boost their sales and profitability, by improving the customer experience. 
AO World today reports widening losses as its sales rise relatively strongly, but its more profitable major domestic appliance market stays flat. It’s finding new ways to boost its business, from recycling to third party logistics and a dedicated B2B sales team. 
Bonmarché reports a fall in profits despite making 29% more sales online. That’s because like-for-like sales are down by 4% in its stores, which are more costly to run, and account for a larger part of its business. Bringing online ordering into the store has given shoppers access to a wider range of goods and sizes, and helped to boost online sales still further.  
But we also report as Ocado and Hotel Chocolat tell us how they are improving the customer experience in order to boost sales. Ocado is using new customer experience management technology, while Angus Thirlwell of Hotel Chocolat speaks in our interview of giving shoppers that all important extra dimension in-store, where experiences include free chocolates and chocolate lock-ins. Both retailers are focusing on what really matters to their customers in order to achieve healthy sales growth and profitability. 
Today we report as peak discounting gets into full flow in our ’this week in peak’ round up. This is the season when most sales are made, and traders will be keen to get their share of the spending. But retailers will also be working hard to square the circle as they look to sell profitably at a time of year now known for discounting. 
We stay with peak trading for today’s guest comment, which comes from Rob Shaw of Fluent Commerce on how to impress shoppers at a time of year that can be, frankly, chaotic. 
Image: Fotolia

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