‘Don’t sit back and let other people do the innovating’

My article appeared in Retail Week 28th July 2021

Covid-19 has kicked some retailers up the behind and woken them up because they had little to no money left in the till.?

It was a bit like the scenes on TV shows when the doctor shouts “clear” and gives the patient an electric shock.?

Covid stopped the hearts of some retailers but the ones that got an electric shock started to change and to do things they had never dreamt of doing in the past.

They quickly thought of?different ways of getting people to spend money with them. Internet apps, click and collect, and even salespeople walking around the store?serving customers who were sitting at home?using video on their phone.?

Can you imagine trying to sell that idea to the chief executive a few years ago: “What, walking around the store talking to a customer with a phone?”?

“Retailers like to observe and read about innovators and maybe try to respond?–?often when it is too late”

Now store doors are open and the tills are ringing again. Are retailers going to go back to their old habits?

I believe that is the danger and the worst of those old habits is to sit back and let other people do the innovating.?

This quote is from a?Sunday Times?article about a new player in the car market:?“Compare these businesses. One sold 20,000 used cars in the 14 months to February, spending big sums on marketing and delivering them to customers’ doors. The other sold 200,000 new and used cars in 2019. It didn’t have high marketing costs, and customers came to pick them up on forecourts. The first, Cazoo, is set to be valued at $7bn in a New York listing. The second, Lookers, is unloved and valued at ￡213m.”

Retailers like to observe and read about innovators and maybe try to respond?– often when it is too late. I doubt if any big car dealership group in the UK is in an advanced stage of planning to compete with Cazoo and its counterpart Cinch.

How do they do it?

An example of one big retailer that once stood by and watched is?Morrisons. The then chief executive Dalton Philips said this about internet shopping: “I don’t think it is awfully relevant. People like to smell and see their food before they buy it.”

On home delivery, he said: “I started my career doing that [on a bicycle] and I don’t intend to do it again.” I don’t think Ken Morrison had many good things to say about him.

“Stop reading about and watching innovators changing the market. Do not wait for innovators to move into your market”

Amazon?has recently bought a pharmacy. Obviously, it is going to move into that business. I take lots of medication and when I read about the innovation it has planned, I thought: “I’m moving to Amazon when it opens a chemist in the UK”.

Boots,?Superdrug, supermarkets, and other big chains could beat them to it and do something now instead of just reading about what Amazon will do.

My daughter bought some clothes from the Japanese retailer?Uniqlo?the other day and she was impressed when she put the clothes down at the counter?– the till knew what was in a pile, all she had to do was pay.?

I have no idea how they do it but if I were a CEO of a competitor I would be telling my people to try and find out how to buy or license the technology.

Stop reading about and watching innovators changing the market. Do not wait for innovators to move into your market. Innovate now.