Martin Newman is the head of e-commerce at fashion chain
and is one of the few UK retailers to have been selling on the web for over ten years. He has experience across all aspects of e-commerce, as well as retail, direct mail, web kiosks and mobile.
We talked to Martin about the opportunities for retailers in the multi-channel arena, as well as challenges such as integration and conversion tracking.
Can you quickly summarise ‘where you are’ as an online/multi-channel retailer?
We are a multi-channel retailer but not fully integrated yet, selling in store and online.
We are currently developing web kiosks for testing in a few retail environments for deployment from September. This obviously has the potential to increase conversion rates from in-store footfall as in some cases, the web kiosks will have a wider range architecture to choose from and customers will also benefit from being able to buy a product even if it’s out of stock in the store.
We are also introducing a gift catalogue that we will distribute through our stores, direct mail and electronically. This is just the beginning for us as we move our model towards true integration, enabling customers to enjoy the same experience through all channels and all touchpoints with the brand.
Do you think multi-channel integration is being driven by e-commerce? Do all retailers need a transactional store online?
I believe that multi-channel integration should be driven by e-commerce as e-commerce is a driver for both on and offline purchases. And therefore the customer experience has to correlate with this multi-channel approach, for example; buy online, pick up in store, buy in store, have delivered to your home, buy through direct mail, have delivered to your home or pick up in store etc.
Also, those driving e-commerce tend to be closer to customer insight as they have the most detailed view of customer behaviour and therefore how best to influence this through an integrated multi-channel marketing communications approach.
We all know that multi-channel customers can be up to 10 times the value of a single channel customer, but you need to know the customer’s behaviour in the first instance in order to understand how to influence it.
Do all retailers need a transactional store online? It’s only a few years ago that many people said footwear and apparel would never work online. This is now the fastest growing category in e-commerce.
So irrespective of the product, the answer for all must surely be yes. Smaller and larger retailers both benefit from extended reach, but the key driver is convenience, and customers want to be able to buy from you when and through whatever channel they choose.
There is also a huge amount of ‘channel hopping’ now among consumers, as well as ‘brand switching,’ therefore if you don’t enable them to buy from you online, they will simply buy from one of your competitors.
How important and difficult is it to measure the influence of offline and online channels in the product selection and purchase process?
It’s vitally important to measure the influence of all channels on product selection and on the purchase process, as doing so successfully will enable you to increase sell-through, drive sales and margin, maximise customer retention and the lifetime value of customers, while continually driving down costs related to acquiring customers and writing-off stock.
Product selection should be driven by a number of factors…
- The role the e-commerce channel has in driving sales in-store.
- The website is a showcase for any business and therefore an opportunity to promote the whole range of products or services on offer.
- Effective merchandising will determine whether or not the business model lends itself to the ‘long tail’ as this is not necessarily the case in all sectors.
- There is a data capture opportunity through all channels – Retail, e-commerce, direct mail, mobile, web kiosks this can provide useful analysis when it comes to product selection across channels.
- Customer profiles vary by channel but it’s still hugely important to have a single customer database with a single customer view, and this in turn should feed into the range planning process for each channel.
Integrated multi-channel marketing communications will enable you to measure the value of one channel to the other in terms of its influence on the customer base.
What can you do to limit cannibalisation of other sales channels by online? Or do you really need to?
All channels compliment each other. Forrester suggests that a purchase made in store first researched online has a 45% higher ATV. All channels should be used and viewed as an opportunity to also drive sales through all other channels.
What are the main benefits of in-store web kiosks, and what are the challenges associated with introducing them?
As above, to maximise demand in-store when out of a size, style, model or colourway, or when the range is narrow due to limited shelf space. The challenges come down to…
- Building a robust business case for developing in the first place and justifying the ROI.
- Ensuring the kiosks are developed with a focus on durability.
- The ability to edit and update remotely without impinging upon the retail team.
- Where to put the kiosks in store to maximise demand without detracting from the retail experience.
- Creating compelling content that drives sales.
- Ensuring the web store has sufficient stock to deal with the uplift in demand driven by web kiosks.
What’s your opinion of the web as a customer retention tool?
The web lends itself well to customer retention due to the ability to understand customer behaviour better than in a bricks and mortar retail environment, and therefore it creates the opportunity to target customers more cost effectively with highly relevant promotional offers.
Some retailers can track purchase behaviour, but on the web you can also track the behaviour pre-purchase and when no purchase is made.
Personalisation and targeted content also enable you to increase the retention of customers - albeit, as I pointed out previously, channel hopping is becoming more and more prevalent and therefore customer retention strategy needs to have a true multi-channel approach.
Segmentation by recency, frequency and value will help to sort out the wheat from the chaff and enable you to target those customers who lend themselves best to being multi-channel customers and with the greatest lifetime value.
What are your opinions on using mobile to acquire or retain customers?
Mobile will undoubtedly be a key channel moving forward but the reality is at present that for most multi-channel businesses, it’s a more effective marketing communications channel than a customer recruitment tool or sales channel.