John Lewis & Partners: Opportunities for the new single business

John Lewis and Waitrose are in a strong position to impress shoppers with ‘What Amazon Can’t Do’ (WACD) services and in-store experiences. This was the view of Simon Russell, Director of Operational Development at John Lewis & Partners, speaking at Retail Connections’ ‘Little Earthquakes’ panel discussion on 16th October in London.

Opportunities as departmental silos are broken up

In the last year John Lewis has been working on combating falling sales and profit decline by investing in online, and carrying out store refurbs, making 15 of its existing department stores pilots for testing events, classes and services. There is also a strategy to empower frontline partners so that decisions can be made on the shop floor that would previously have been referred up to line managers. “We also want to get rid of as many Branch Operation Procedures as possible,” said Russell.

John Lewis & Partners announced this month it is merging the management of the department stores and the Waitrose supermarkets to cut costs. Russell commented when asked what the operational impact would be: “There are parts of the business that have been operated as complete silos. It’s early days but there are obvious overlaps that will be addressed in every area that we run the business and the focus is Partnership first and brand second. For example, it makes sense that we source and buy similar categories like gift foods and kitchenware in both Waitrose and John Lewis – but equally there will be some times when the brands need to be offering something different.”

Simon Russell John LewisSouthampton store brings services to the fore

Russell said the Southampton John Lewis store is being used as a test bed for promoting in-store services and events more visibly to shoppers. A different layout with will be revealed in November that brings added-value services to the fore, and a “few surprises” in terms of the experiential use of space. Customers will also enjoy an enhanced focus on service from partners.

“Elements such as personal styling and home design services will be made more obvious around the spine of the store where the central escalators are located and shoppers naturally flow,” said Russell. Partners equipped with iPhones – which have been rolled out nationwide – will be engaging directly with shoppers to help them access product information and services more easily.

JLP’s ‘What Amazon Can’t Do’ assets and services

Russell said: “We’re very aware of WACD and we have so many opportunities to move beyond simply selling stuff. Our understanding today is that consumers don’t just want to buy things. They want solutions to their everyday problems. So, if they buy a ceiling light, it really helps them if the home delivery driver can install it for them too.”

John Lewis & Partners Cheltenham Experience Desk

The 153-year old retailer is on a major strategic mission to enrich its retail offering with a range of complimentary services and experiences. These include a nationwide Home Design Service to help customers style their homes, free in-store fashion advisors, opticians, floor and window services, electrical services such as TV installation and computer set up, and a host of financial services.

JLP employs over 400 curtain and carpet fitters nationwide and has its own broadband offer. Meanwhile Waitrose is working on a ‘While You’re Away’ delivery to fridge service in which delivery staff access a customer’s home using a specially-installed smart lock.

Russell did not specify what percentage of revenue would eventually be driven by services saying; “It won’t be as much as 50% but it will be significant. The key will be to shout about them more.”

Gen Z on the radar

Amazon may have massively disrupted traditional high street and department store retailing, but physical stores are ideally placed to use their physical space to work on their differentiators. Russell conceded in the panel discussion that too often at John Lewis “we don’t shout loudly enough about all the services we offer”.

Asked whether JLP should be trying harder to capture the Gen Z market, Russell said that new customers tend to be acquired at “key life stages” such as when they are getting married and want a John Lewis wedding list. “We need to cater to our target customers first and foremost. Gen Z is undoubtedly the future. There will be certain moments when we recruit younger shoppers, and we do need to really draw them in at those points.”

 

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