In today’s InternetRetailing newsletter we report as both Space NK and Majestic Wine show how digital is firmly in the ascendant in their businesses. Space NK has appointed its digital director, Andy Lightfoot, as chief executive in a decision that seems to reflect the growing preeminence of digital in the multichannel equation. The multi-brand beauty retailer says that stores are still very important for it, staffed as they are by trained make-up, skin and hair artists able to give personal advice to shoppers. But its the combination of those stores with digital that helps to turboboost the business, and its sales.
Majestic Wine has gone still further by declaring that while both its store-based Majestic Wine, and its pureplay business, Naked Wines, have great potential for growth it can only invest in one - and it’s chosen digital over multichannel. The decision may be seen as a brave one in which the retailer puts all its energies into a business model that focuses, as all retailers now must, on its customers, while very rarely meeting them. What the retailer has done, though, is to choose firmly between two possible futures, in making that decision it’s putting its money firmly on digital.
Today we also report on two of the UK’s grocers, both showing their commitment to stores in the UK and beyond. Iceland, which claims the title of the UK supermarket that’s growing its online business fastest, is opening stores quickly, while Tesco even took the decision to close its general merchandise ecommerce business Tesco Direct in order to simplify its business. It has continued to see growth online, though that growth was restrained by the closure, and some of its most innovative steps since then have connected the store to online, as it laid claim to the title of first UK grocery to offer different prices in-store for loyalty club members.
If Majestic Wine’s decision to opt firmly for digital over a multichannel approach is brave, then the decision by around a third of UK businesses, according to new IoD figures, not to plan for Brexit at all, might also be seen as brave, if not foolhardy. UK retailers cannot help but be affected by the way the UK leaves the EU. Even if they do not actively target European markets, it’s highly likely that European buyers will shop from them, especially if further declines in the value of sterling make their wares more of a bargain than previously. The only way that retailers might escape the effects of Brexit is if they neither source from the EU or deliver there. But that seems to fly in the face of conventional thinking about where growth comes from. Those who don’t prepare may consider, rather, that it’s impossible and expensive to prepare for something that is uncertain, and choose to make their arrangements once things become clearer. But looking for sources of upcoming change, from the way that shoppers buy to a no-deal Brexit, is giving smart retailers a real advantage in an industry in which those that don’t adapt are being left behind.
Today’s guest comment is also all about change, as Benoit Soucaret of LiveArea identifies seven disruptors in the health and beauty industry.