Holland & Barrett aims to be a £1bn-turnover business by 2020. Chloe Rigby asked ecommerce director Emma Mead about what roles omnichannel and digital retailing are set to play in realising that ambition.
WHEN HOLLAND & BARRETT celebrates its centenary in 2020, it could also mark a financial and strategic milestone by turning over £1bn for the first time. It’s an ambitious vision for the company, which is part of the private equity-owned NBTY Group. For when it set that target at the end of its last financial year, its revenues were £573.8m – a little more than half of that figure.
The Holland & Barrett of 2020 will sell in very different ways from the business of 1920. Its stores remain at the heart of the business – just 10% of sales are currently online – but the health and wellbeing retailer, a Top150 trader in IRUK Top500 research, is taking a targeted approach to omnichannel trading as it looks to satisfy its customers’ demands.
“We’ve the capability of being nimble in how we learn from an online perspective”
Emma Mead, director of ecommerce, leads a growing team tasked with providing a highly strategic approach to omnichannel. In the nine months since she joined the business the focus has been on recruiting skilled digital staff and ensuring the right foundations are in place. Mead says the business has been “a very fast follower of all the concepts that other people have had out there”. She adds: “We’ve fully rolled out click and collect to all 760 stores, and we’ve got the capability of being very nimble in the way that we test and learn from an online perspective.” When research showed that a small group of customers, working long hours and not able to visit a store, was significantly dissatisfied with delivery options, the retailer responded by working with InPost to offer locker collection – one example of how customer insight is helping the team to set priorities and achieve targeted goals.
From here, the focus is on growing online sales while understanding and developing the way that digital influences the offline business. The aim is connected commerce, where customers can move seamlessly between sales channels in the course of their purchases. That’s important since, “The customers that engage with us through many channels are our most valuable customers,” says Mead. “It’s their frequency and their lifetime value that we focus on.”
Holland & Barrett ranks well in research by InternetRetailing that aims to identify the leading UK multichannel and ecommerce retailers in the Strategy & Innovation Dimension. Its click-and-collect and next-day delivery services give it an edge over the competition, as do international delivery and payment options. It scores highly with a search reach that means it’s visible to 61% of people searching for terms related to its products. Mead says that being seen in search is “fundamental in the success of the business” since, “It not only drives sales through the direct channel but it actually drives sales in our retail stores as well.”
One strength of the Holland & Barrett business is the depth of knowledge that trained staff have about its range, from health foods to supplements. “How do we make sure that we can provide the same quality of advice to customers searching and looking for information from a digital perspective?” asks Mead. So far the company has introduced online live chat, while an in-store app enables loyalty programme members to look at online information.
“Joining that experience up for all of our customers will be one of our big leaps forward,” says Mead. “The next would be how we use mobile as the glue to join together all of that accumulated experience.”
InternetRetailing research shows that Holland & Barrett’s approach to mobile stands out for bug-free iOS and Android apps. Two thirds (66%) of traffic and 45% of online sales come through a mobile device. Shoppers will be able to make purchases and use their loyalty cards through apps in the next six months, says Mead.
Currently, Holland & Barrett can see how members of the loyalty programme interact with the brand, what they buy, and whether they buy it online or in-store. It segments customers to serve them relevant content: key groups include the ethical young female buyer and an online-only group aged between 25 and 45, while the largest group consists of older customers maintaining their health. “We get lots of insight and data, we capture lots of information from customers, and we are able to make small refinements and improvements. It’s all those little improvements that then add up and create something that’s worth more than the sum of the parts. And that’s what really starts to move the dial and improve the customer experience overall,” says Mead.
InternetRetailing research already rates Holland & Barrett customer service. A shopper enquiry on Facebook, for example, was answered in a speedy 16m. “Today, you can’t afford not to be focused through social,” says Mead. “It’s the way to engage with customers since that is how they spend a significant proportion of their time. What you want is that brand advocacy and to drive positive messages. That is why we focus on resolving issues really quickly for our customers.”
International is a key strategic focus for the brand. Its dedicated Netherlands site is performing well, while ecommerce is also being rolled out through franchise partners around the world. Customers from the European Economic Area can order for delivery from the UK site.
One important group is Chinese customers. This is a group, says Mead, for whom authenticity and provenance is important. “This suggests a significant opportunity for us,” she says. “We have a presence in China and we’re continuing to look at how we develop that market.”
The next phase of the strategy is likely to produce something very different. “We’ve scoured the marketplace for innovative ideas that we’ve executed really well,” says Mead.
“We make sure we have a test-and-learn mentality, bringing in agile ways of working. Everyone understands where we’re going. I think that will enable us to generate something that is truly innovative.”