Omni Channel Retail – Right Here Right Now this Christmas

IBM posted five predictions for the next five years, which is a great New Year’s game – and all credit to them for sticking their necks out.  Everyone should play this game.

Bernie Meyerson, vice president of innovation at IBM, came up with their “5 in 5″.  Apparently, this is the eighth year in a row that IBM has made predictions about future technology.

“We try to get a sense of where the world is going because that focuses where we put our efforts” Meyerson said.  He continued “The harder part is nailing down what you want to focus on. Unless you stick your neck out and say this is where the world is going, it’s hard for you to turn around and say you will get there first. These are seminal shifts. We want to be there, enabling them”.

These are Meyerson’s “5 in 5”:

▪                The classroom will learn you (sic)

▪                Buying local will beat online

▪                Doctors will use your DNA to keep you well

▪                A digital guardian will protect you online

▪                The city will help you live in it.

I’m not sure what this means for grammar in the future, but Meyerson says some very interesting things, and I would judge predictions 1, 3, 4 and 5 to be pretty much on the money.

However, I do have experience in online selling and retail, and so I would take issue with his second proposition:

“In five years, buying local will beat online as you get online data at your fingertips in the store.”

Meyerson argues that “retailers will use the immediacy of the store and proximity to customers to create experiences that online-only retail can’t replicate”.

I would agree with that – but this is not, in my view, something for five years in the future.  Meyerson says that “the Web can make sales associates smarter, and augmented reality can deliver more information to the store shelves”.  He suggests “the store will ask if you would like to see a certain camera and have a salesperson meet you in a certain aisle where it is located”.

This is not, in my view, a future issue but is in many respects with us here and now.  What many – perhaps most – shoppers in the UK wanted to do over Christmas was to shop “omni-channel”.  Many of us when buying gifts or things for the house, or indeed clothes, want to research in-store – to bounce on a mattress, say, or look at a high definition television.  We want to see and test some products and get expert advice. After that, we may decide to buy there and then from the store.  Or we may prefer to go back home and buy online.  Or sometimes it’s the other way round: we want to do our research online first, and to check prices, and then go out and buy the product in our hands in the store.  Increasingly many of us like to order online then “click and collect” to pick up in store, where we may well buy other products too.

So this is not a future thing, but once which is happening here and now; and competition between shops and online – between “bricks and clicks” – is just not the way forward.

At John Lewis we estimate that at least 2/3rds of our customers are already “omni” – that is, they shop in some way (e.g. research) across online, in stores, on the phone and on mobile devices.  This development has helped drive our sales on and in our stores: our like-for-like sales were up 6.9% over the 5 weeks of the  with online up 22.6% and stores also up 1.2%.   The “click and collect” sales jumped 60% compared with 2012.

There have been 3 weeks around Christmas and the New Year when our online sales jumped to c36% of the total we had passed £1billion online sales for the financial year (from 1st Feb) before we got to Christmas.  We know, however, that this is absolutely not  about online shopping – it’s about the ability to shop across all our John Lewis channels.

Human beings sometimes want to get information and advice from other human beings, sometimes they want to pick up the phone, and other times they just want to shop online with simple clicks.  And sometimes they prefer to shop now and then pick up at a time next day that suits them, rather than wait in for a van to deliver.  It’s about us all being different and having different needs when we shop.

“It has been physical against online” Meyerson says, “but in this case, it is combining them.”  So he’s right – not about 5 years in the future, but about the here and now.

About paulcoby
I am CIO at the John Lewis Partnership in the UK. I was Chair of SITA - the airline solutions company owned by the Air Transport Community - for 11 years. I am also on the Boards of Clydesdale and Yorkshire Bank and Pets at Home. Previously I was Head of BA Services and for 10 years CIO at British Airways. I am interested in Roman and Military History. The views expressed are entirely my own not my employers.

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