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IREU Top500 The Customer Report: 2018

IREU Top500 The Customer Report: 2018

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More than half of Shop Direct sales made by smartphone for the first time

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More than half of Shop Direct sales made by smartphone for the first time
More than half of Shop Direct sales made by smartphone for the first time
More than half of Shop Direct sales were made via smartphones for the first time in its latest financial year.

The home shopping group behind brands including Very , a Top50 retailer in IRUK Top500 research, Littlewoods.com , a Top100 retailer and VeryExclusive.co.uk, said that 53% of sales were via smartphone, and 69% via mobile devices – smartphone plus tablet – in the year to July 1. A third (32%) of all mobile sales at Very came via its MyVery app, up from 21% a year earlier.

The retail group turned over £1.93bn in the year, up by 3.7% in total, or 5.6% on a like-for-like basis, while pre-tax profits of £160.4m were up by 10.2% on last time.

Shop Direct said its investment in mobile personalisation before, during and after customer journeys drove smartphone sales. Measures included working with Google and Facebook to identify users who look like Shop Direct's most valuable customers and serving them relevant and timely ads and recommendations. It also applied machine learning to identify customers who are showing signs of lapsing. Those customers were then contacted with an incentive to buy. Machine learning also helped it to predict when a customer would run out of a product by sending a reminder for them to stock up. That approach, it said, had generated "strong results" across beauty products and scented candles.

Later this year it will also launch the AI-powered natural language of its customer service chatbot in the MyVery app. It promises to answer 32 different types of questions, and to recognise and respond appropriately to 4,000 written phrases. Eventually it plans to give customers a personal shopper type experience through the chatbot.

It is also bringing personalisation to bear in credit offers, and new credit customers increased by 7.6%. Next year it aims to apply AI to credit decisions. However, this week's figures also saw it set aside £121m for exceptional costs that envisage customer redress claims of £112m arising from regulatory issues.

Alex Baldock, group chief executive at Shop Direct , said this was its fifth consecutive year of record sales and profits, with Very and m-commerce big growth drivers.

“Our long-term investments in digital, data, personalisation and Very are coming good," he said. "And our obsession with winning the ‘three-second audition’ on smartphones also continues to pay off. We’re delivering one of the most relevant shopping experiences on a 4.7-inch screen, with our five-star apps, digital marketing expertise and leadership in personalisation.

“Our customer already loves the upgrade she gets from our famous brands plus credit, but this business is still nowhere near its full potential. Using personalisation, we’re striving to be the easiest and most inspiring place to shop.

“Artificial intelligence is already driving results for us and we’ll soon launch one of UK retail’s first AI-powered chatbots for customer service. Longer term, we believe AI will bring scale to personalisation so digital retailers like us can be every bit as personal as stores. Very Assistant 2.0 will be another step closer to us democratising the personal shopper.

“We don’t expect the economic backdrop to get any easier, but we’ve started our new financial year in line with expectations and are confident of delivering another record year.”

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