Boots: beauty in an omnichannel approach

Like it or loathe it, we haven’t come up with a better term than ‘omnichannel’ to describe the evolving nature of consumer behaviour and indeed retailers’ approach to dealing with it.

And who better to explain the benefits of such a strategy than Robin, who Retail Connections heard speak at IRX 2017?

Building blocks

While at Boots, Phillips was responsible for digital and IT as well as the retailer’s hugely successful Advantage card loyalty scheme, a subject he is particularly keen to talk. Speaking at IRX, Phillips outlined his framework for omnichannel success: “It is inevitable that retailers will have to make strategic partnerships and outsource some elements of their P and L,” he advised.

In this regard, Sainsbury’s and Argos have succeeded in sharing the cost of technology and supply chain. Now, more retailers will need to think about what they can do themselves, and what they will need to outsource.

Measure together

Brand proposition is key for Boots – “what makes you different to Amazon?” Phillips asked.  To get ahead, retailers must innovate and prototype quickly; it’s essential to test products in customers’ hands as soon as possible to speed up time to market.

Weekly trading meetings are also essential for all retailers to take the temperature of their business. However, Phillips argues too few are measuring the same KPIs and talking about the same targets.  An enterprise scorecard can help here to ensure ecommerce and bricks and mortar are singing off the same hymn sheet.

Loyalty and personalisation

Promotions and loyalty schemes need to be seen in the context of “the value of the core customer” Phillips concluded.  Failing to do so can result in giving margin away for no reason, if analysis shows a shopper would have bought a product at full price anyway.

In terms of personalisation, Phillips says retailers’ campaigns should “act like a butler and not a stalker” when mining customer data.  In addition, they must have a memory of their customers across channels, and demonstrate they have understood the whole journey.

For example, when a shopper picks up a click and collect order, it’s important for staff to acknowledge when and how the order was placed, to keep up the dialogue and experience. Indeed, through the use of tablet devices, retailers can bring their entire supply chain capabilities to bear in one place, and bridge the divide between the physical and the digital worlds.

Authentic personalisation should refer to past orders and suggest other options that will resonate with the customer. Phillips sees the advent of ‘differentiated permissions’ borne out of his time with Boots’ health department.  For example, diabetes patients are much more likely to opt into marketing communications if they can see how it can help them manage their condition through appropriate treatment and recommendations.

Perhaps the most interesting point Phillips made was not to do things the same just because that is what has gone before.  For example, he recommended a zero base budget each year on marketing so that each element was treated on its merits and its performance evaluated.

 

 

 

 

 

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