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What constitutes a retailer? (IRUK 2016)

The cross-channel retail landscape is more complex than merely “having a website” or “operating a store”. In choosing which companies to include in the IRUK Top500 2016, we have considered companies’ intent, capabilities and activities around the recruitment and monetisation of customers. The definition for the inclusion in our research is:

Destination: the retailer has created a destination that, in the minds of customers, is a source of product, service or experience. Whether this is a shop, a site, a place, a time or an event, it’s the sense of “locus” that counts.

Purpose: the retailer has created goods and/or services for the purpose of selling, for consumption by the purchasing consumer.

Merchandising: the retailer actively sells and is not just a portal for taking customers’ money. This means the selection, promotion and tailoring of retail offers for customers.

Acquisition: the retailer actively markets, recruits and attracts customers with a promise or proposition to the destination.

Sale: the retailer takes the customer’s money. The retailer own the transaction as the merchant of record.

Recourse: the retailer is responsible for the service, fulfilment and customer satisfaction flowing from the sale.

Exception: in every good list there’s an exception, where we may include businesses within IRDX (our dynamic list of cross-channel and ecommerce companies, suppliers and key personnel) due to their influence upon retailers and retailers’ customers. However, these companies will not be ranked within the IRUK 500 2016.

Companies excluded from the IRUK 500 2016

Marketplaces: where a candidate retailer is simply a marketplace, the company is not featured. Where a marketplace undertakes customer acquisition, manages payment, customises offers and recommendations and offers recourse on purchases, then the company will be eligible for inclusion. For more on the influence of marketplaces on the overall retail landscape, see page 28.

Pure transaction/tariffs: where ecommerce is ancillary to the primary purpose of a business, we will not necessarily include them. Online payment for gas or electricity is excluded since the business’ purpose is ‘energy supply’. Likewise the Post Office’s postal revenues are excluded, whereas the company’s retail store activities are within scope.

This year, we have amended the list so that travel companies are no longer included. We have also excluded media-streaming services. However, these categories companies offer clues as to where retail might go. See pages 26 and 27 for more.

Business-t0-business and direct-selling brands: while the scope of retail is normally direct to consumer, two trends are challenging this: the move for brands and previously solely B2B businesses to sell direct to consumers; and the increasingly retail-like behaviour of B2B brands (in terms of acquisition, promotion, personalisation and service). We have therefore included certain B2B businesses and direct-selling brands.

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