12 approaches to strategy and innovation from leading multichannel retailers
Retailers that come up with new ideas and approaches leave the competition standing. But those that are slower to innovate can still set the pace in the industry by following quickly where others have led. Chloe Rigby outlines 12 approaches that IRUK and IREU Top500 retailers, leaders in related industries and smaller, innovative players are taking to strategy and innovation.1. Set the standard
Being first to offer a service gives an in-built advantage. True innovation means there’s no rush to catch up, while competitors must build their services from scratch. But it’s important to maintain that advantage by continuing to improve services and products, while also thinking of new angles for related services. Amazon set the pace when it first started selling books online and it’s maintained its competitive advantage over the years by continuing to trial fresh ideas and approaches.2. Watch the competition
When competitors are providing a clearly more convenient or desirable service, even leaders in the sector consider following suit. Tesco recently jumped ahead of fellow grocery retailers when it introduced same-day click and collect for grocery orders at 297 locations, including 36 outside its own stores. This overtook the 250 already offered by Asda while Sainsbury’s was still trialling its own service. The highly strategic move came as Amazon continues to expand its own grocery service, AmazonFresh. This offers fast deliveries but doesn’t have the advantage of click and collect, which enables shoppers to pick up at the moment that works for them rather than waiting in for a delivery time slot. Beyond groceries, general merchandiser Argos innovated within fulfilment when it introduced its FastTrack service to offer same-day deliveries and collection.3. Think what the customer really wants…
Starting with what the shopper wants is a smart approach to designing services that meet genuine needs. M&S , for example, questioned its shoppers in depth when it launched its Sparks loyalty card, which uses gamification approaches to encourage repeat business from customers, both online and offline.
More recently, sofa manufacturer Sofa Brands International (SBI) launched its multichannel retail business The Lounge Co after deciding that what customers want most when buying sofas is the chance to try them out first. One initiative is that it’s showing its products in galleries and concessions around the country. At launch, Julian Neal, director of SBI and CEO of The Lounge Co, said he had seen the furniture market go through “significant structural change” but that at heart, consumer behaviour had not changed at all.
“People use the internet to research our products and expect speed, ease of use and extremely high-quality content,” he said. “However, customers who are investing significantly in an item of furniture that they’ll own for a decade or more want to experience that product first. It’s critical to us that customers have a gallery nearby because they need to see the products, touch them and assess their comfort. The business model was designed entirely around these needs.”This feature is from the latest IRUK Top500 report, on Strategy and Innovation. To read the rest of the 12 things, click here. To read the rest of the report, click here.