I’ve just published the web version of my Editorial for the November 2010 issue of our Magazine. You can see it on Internet Retailing’s site here:
Here’s my editorial from the September 2010 edition of Internet Retailing magazine. You can see this article in the digital edition here:
We’ve long predicted that multiple channels will give way to an integrated commercial approach, but inspired by the World Cup – and not allowing his utter ignorance of football to stand in his way – Ian Jindal reflects on the lessons from the Beautiful Game’s radical transformation in the 1970s, drawing parallels with today’s changes: welcome to the age of Total Retail.
In January’s column, we looked forward to a year in which Boards would place ever-increasing demands on the eCommerce teams, and that eCommerce leaders will need to become rounded, commercial leaders in order to secure their role on the Board. Since January we’ve also seen the rise of mobile and m-commerce and this has increased the pace of innovation and digital development, further eroding channel boundaries. M-Retailing.net, our new title, charts the increased pace of change, but there remains a nagging feeling that the game has changed.
In our businesses we expect our teams to combine deep functional expertise, with a non-trivial appreciation of other disciplines, and finally an ability to assimilate and master change situations, new skills and the changes in customer behaviour and demands. Admittedly there’ll be training – both corporate and self-directed – but there is also a need to reconsider the way we manage and lead our digital teams, as well as the wider business, to achieve against these demands.
In the 1970s there was a similar need to change the approach to football. With faster balls and pitches, increased professionalism and training demands, the static tactical approaches that ranged lines of offence and defence against each other had become turgid. The insight was to create a system where any player could take over the role of any other player – fluidly, autonomously and to great effect. A multitalented player would be expected to be an attacker, a midfield play-maker and a defender – seamlessly and without pause. A jack of all trades and master of most.
Central to the tactical approach of Total Football were the notions of creating space, flexibility and collaboration, founded upon rigorous and demanding training and a proactive attitude, always seeking opportunity and taking initiative.
Likewise the modern eCommerce team. For ‘creating space’ we have the need to create commercial opportunity – even amidst the mayhem and turmoil of minute-by-minute trading. Members of a Total Retail team are expected to act commercially, create opportunities, despite the pressures of daily activity.
The notion of multitalented team-members is also vital. Not only must there be an appreciation and understanding of other people’s skills, but team members must also be able to make a credible contribution in other areas. No more “I am a marketeer” or “I am a technologist” – eCommerce professionals must be both (as well as operationally savvy and commercially astute). Indeed, we created the MSc in Internet Retailing as a programme to assist the development of multi-talented leaders for our industry.
One aspect not present in the 1970s was “fan power”, or ‘customer power’. Our colleagues in store have the most intimate human contact with some customers, but across the whole business it’s the multi-touch, extensive digital contacts that give eCommerce professionals a privileged insight to the customer’s activities. With social media we have an enviable view of the customer’s attitudes and activities beyond the shopping experience in our domains. Further, considering m-commerce and mobile interaction, we’re increasingly able to gain more insight into customers’ behaviour even when they’re not “online” and explicitly shopping or researching.
Total Retail is the opportunity for us to progress from a simple injunction to ‘be more skilled and commercial’ to an approach of being more engaged with customers – at every stage of consideration, socialising, learning, buying and sharing. Being of service to a demanding, knowledgeable and social customer, at all times, places and points of attention. It’s a fully committed approach. To deliver upon this demand we need both to hone our individual skills as players, and to develop a ‘game play’ that is open, flexible and enterprising. The tenets are skills, flexibility, collaboration and creating opportunity.
This shift will be uncomfortable and demanding, even upon those who believe it to be a necessity (and an opportunity). However, it’s likely that our customers will come to expect this sooner than the majority of retailers will respond – meaning significant spoils for those who can bring sparkle to the retail game, much as the Dutch shook up football 40 years ago. Time for us all to embrace Total Retail, and we’ll return to this theme again over the coming year.
October’s conference season’s highlight (for me, anyway) was the fourth Internet Retailing conference – IR2009.
While I’m of course biased (!) the conference saw our highest attendance (just under 1,000 in total, with 450 full delegates), an expanded roster of exhibitors and, crucially, the introduction of our plenary keynote session to open the day.
We were privileged and inspired to hear from Peter Fitzgerald (Retail Industry Head at Google UK), Jane Judd who heads customer service at Zappos and Robin Terrell, MD of John Lewis Direct. Any of these speakers alone would have made a wonderful conference opener, but to have all three was a luxury (one that we intend to repeat in future years – I think we now realise that one can’t have too much of a good thing!).
Peter, above, gave us Google’s view on the ever-increasing pace of change, and the need for retailers continually to ‘up their game’ to remain competitive. A chilling message, delivered with Peter’s usual charm and clarity.
Robin wowed the audience with his combination of shared insights and facts (his openness was astounding and very highly praised) along with a down-to-earth pragmatism about the tasks and challenges ahead. I won’t précis his speech (you can see the full video on the conference since) but I’ve never seen before 1,000 people, as one, dive to write notes at a speaker’s every utterance.
Robin’s speech was one of the best keynotes I’ve seen and one of the most highly-rated ever at our conference.
Jane, below, took a few moments to introduce us to the Zappos way and then peeled layer after layer away to reveal a characterful and savvy underpinning to “The Zappos Way”.
For the rest of the day it was intense networking as well as note-taking and idea-exchanging in the three parallel streams. Here are some photos from the day…
Morten Kamper, CEO of the Danish eCommerce and Distance Selling Federation (FDIH) asking a question of the keynote speakers
Mark “Many Phones” Pigou, my business partner in InternetRetailing and the conference promoter. Odd to see him smiling until the very last stand is down and the feedback is in…
Mike “Dr Mike” Baxter, redoutable Stream Chair, engaged on a panel…
Rob “I’m Listening” Prevett, IR’s Account Director, personing the stand at the show…
… and humour (plus marketing budget!) from Jacob Salamon at Bazaarvoice. They’ve enlivened our conference for the last couple of years with “Badge Flares” – adhesive messages for the bottom of delegate badges – but this year pulled an “homage”. Great fun, and I’ve used this image in lieu of a business card for a while since. Thanks Jacob 😉
The 2010 conference information is already available at http://screenevents.co.uk/IR2010/index.html and I’m looking forward already to building on the success of 2009 to make our fifth annual event even better!
A while ago we launched the Post-Graduate Diploma in Internet Retailing. The programme was developed, in conjunction with Econsultancy.com, to support the skills and career development of multichannel retail professionals. The qualification spans the gamut of etail activity – from buying, sourcing and category management, to online marketing by route of operations, IT and logistics.
On Tuesday we were challenged by the accreditation board of Manchester Metropolitan University to assess whether the programme was at a sufficiently high level and with a suitable supporting academic framework to be worthy of being awarded Masters status.
After three and a half hours of grilling by the panel and external assessors we were incredibly gratified to be told that we had been approved as a Masters programme.
Congratulations are due to David Bird, Director at MMU’s Business School and Craig Hanna, Training Director at Econsultancy.com, both of whom worked incredibly hard to make the programme ready for assessment.
We’ve now got to update the webpage and revise marketing materials to reflect that this is now (we think) the UK’s first and only…
“MSc in Internet Retailing”.
Westfield (a client) organise a world retail study tour for Australian businesses to visit peers, examplars and trend-setters in the US and Europe.
On the London leg of the tour – following a period in the US – the delegates had visited key retail stores, niche retailers, characterful areas of London and for a day heard presentations from major retailing figures.
I was pleased to be able to open proceedings this morning with a presentation on ‘the UK online consumer’ and trends and issues in multichannel retail.
As it was a private presentation there are no slides available.
This article appeared in November 2008’s edition of Internet Retailing Magazine.
This last month has seen Ian Jindal up to his nose in web analytics and trading reports, pondering the painful question of “conversion”: can this really be a useful metric for etailers?
Now there’s no arguing that conversion is a ‘metric’. Number of visitor sessions ending in a purchase, divided by the total number of visitor sessions. Ta-daah. After a month of looking at ‘the math’ (as our US friends would say) I’m losing faith that this is an actionable or useful metric.
Conversion has its place in reporting: at a gross level it’s a rolled up indicator of “persuasive attraction”: how many people are being attracted to the site, and from that level how effectively are they persuaded to buy. However, if conversion is up or down then it’s not clear that there’s a single lever to apply. Unlike a car’s speedometer, it’s not straightforward to press or ease the accelerator to regulate the speed. Conversion as a metric lacks direct impact on the business: it’s observational rather than action-oriented or definitively comparable.
Two retailers may have the same conversion, but revenues many millions of pounds apart. Equally, a multicategory retailer may have very different conversion rates across products from £3000 sofas to £20 trousers. Who’s making the most money? The best use of resources?
Where products have a long consideration cycle it’s misleading to simply consider the final, purchasing visit as ‘effective’, while the previous ones are somehow ‘overhead’.
A final objection is that in a multichannel world research and purchasing my take place over different channels – where then does ‘conversion’ help drive our activity?
My contention now is that conversion should be consigned to the dustbin of pointless, but detailed, metrics – nestled alongside the “hits” measurement from the 90s.
What then can satisfy us as being a rolled-up metric, against which you can manage your business and which is directly comparable across etailers, categories and time?
Such a metric would need to include as a factor the notion of “profit” – otherwise it’s simply an engineering metric of ‘activity’. Equally, it should relate to maximising invariates.
In traditional retail we have a universal metric of profit per metre of shop space. This illustrates a retailer’s effective use of the fixed resource (space) and their management of yield and profitability.
Online, our limitations are different. While some of us may still believe in the misleading fallacy of the ‘infinite warehouse’, we know that our two limiting factor are:
- the screen size – there’s no use having a magic warehouse if the window is small, dirty and germ-ridden!
- the attention span of the customer, measured in the number of seconds they’ll spare for you in which you may persuade them to buy.
This leads to a metric that could be expressed as yield or profit per pixel-second.
We know that not all pixels are created equally and placement is vital: persuasive messages, imagery, promotional prominence, branding, tools – all vie to colonise the limited space. Different retailers take widely diverse options – luxury brand stories versus pile ’em high money-off screaming. Let’s measure their effectiveness on yield.
So then to customers. We’ve noted before that a rising tide floats all boats, and until the end of 2008 there were plenty of new customers spending evermore time each online to allow every retailer to record growth. However, in a saturated market there’s evidence that online customers are settling into a core group of a dozen retail sites (where ‘retail’ include aggregation/affiliate, voucher and cash-back portals who – from a customer’s perspective – are simply alternative ways to shop). The battle now is for the customer’s attention as much as for their money once you have that attention.
Of course, the cunning reader will realise that I’ve not included here the important offline dimensions – time spent handling goods in store, discussing configuration of complex furniture offers, speaking with experts about high cost items… However, a number of retailers are experimenting with ways to track a customer’s activity across channels – a voucher code in-store redeemed online, purchasing cards, logging, custom item codes, case numbers…
As these gain traction – and retailers can take a multichannel view of the effort and investment needed to support sales – then yield-per-pixel-second will morph into a metric of ‘yield per customer engagement second’, across all channels.
At this point we’ll have a universal, comparable, profit-oriented metric. This will allow us to benchmark ecommerce operations, but also see the value of etail within the mix – and importantly draw in the costs of contact centres, store activities and direct mailing into an overall cost of doing business. Maybe not next month, but such an index of effectiveness must be the aim.
ACSEL, now L’Association de l’économie Numérique, is France’s leading body representing eCommerce, multichannel and distance selling (Vente a Direct – VAD) working via digital channels (hence the name change to ‘numerique’).
On Tuesday January 20th they held a conference on eCommerce and social media, with representatives from across Europe looking at the adoption and commercial aspects of SM.
It was a fascinating and very engaged session – some 380 turned up, against a registered level of 120! – and the good folk at Baker and McKenzie (in their wonderful venue) did well to cope – the presentations were filmed and streamed live to an overflow room.
You can see the presentations from Spain, Italy, Slovakia, France, Germany and a Scandinavian overview at the conference page.
My presentation is available on slideshare, embedded below:
This article appeared in November 2008’s edition of Internet Retailing Magazine.
After the buzz and positive atmosphere at the InternetRetailing 2008 Conference, Ian Jindal considers the role of ecommerce in a hostile and uncertain period for retailers: can etail’s star shine undimmed?
There’s a stunned and bruised feeling in retail. Not so much as a result of the downturn/recession/depression (delete according to pessimism) but at the effect of the unintended consequences.
The speed and extent of the seizure of short-term lending markets has caused significant trouble to businesses who depend upon flexible working capital: growing businesses, seasonal businesses, leveraged businesses with liquidity covenants and suppliers whose working capital needs to be with retailers are all suffering. The amplified impact of retail and manufacturing workers losing confidence, buying power or even jobs will be, for the retail sector, like hitting a wall.
In retail Boardrooms across the land, all eyes are now on eCommerce. While offline like-for-like performance is down across sectors, eCommerce is still growing or at least ‘holding up’. As drowning men cleave to passing logs, so do CEOs view the online channel as an opportunity to save the financial year. Many in eCommerce, myself included, remember the nuclear winter of 2001-3: the question is what lessons have we learned and do we have the strength to apply them?
The key lesson is that this is a time for brave people to be ruthless and focused. In a rising market there’s always a “mañana” in which to implement gentlemanly improvements in segmentation, stock control, processes, addressing margin… However, there is no “tomorrow”. I know that Christmas is busy, but we must all fear that January post-sale will be even tougher. Putting off decisive action until December 31st is folly.
While each business is different, in general we can concentrate upon pace, focus, agility and responsiveness – attributes that should be a fundamental part of ecommerce.
Pace is vital since we need to trade our sites daily, not weekly or monthly. Learn lessons quickly and implement immediately. This is no time for a ‘to do’ list – you need a ‘just done’ list!
Focus must be upon customer-facing activity – help them part with their cash. Simplicity is a function of this: in merchandising, marketing and projects.
Agility is needed to move quickly and with confidence: make the changes now, not next week!
Responsiveness should be to the customer or emergent opportunities. The origin of the word ‘retail’ is from the French word “retailler” or ‘re-tailor’ – creating something anew for each customer, focused on serving them. The web’s ability to segment, personalise, algorithmically optimise and merchandise should come to the fore. Now, today – not tomorrow.
These are simple requirements, but take backbone to implement. Wibbling, waffling and waiting should be reserved for those on the sidelines.
Even with this bold, brave approach we etailers are dependent upon our colleagues in logistics for service levels, buying and merchandising to have the right goods to sell and our stores and contact centres for cross-channel leverage. The temptation is to try and forge ahead online but now more than ever is the time to work closely with colleagues to burnish a consistent service to customers across all channels. While your colleagues see ecommerce as an opportunity to rescue trading performance you have an opening to cement cross-channel working… not to show that you’re separatist, selfish and narrowly focused!
eCommerce continues to perform well, and it’s said that stars shine more brightly against a dark sky. However, our aim cannot be simply to be valued in comparison with the decline of others. eCommerce professionals have an opportunity in the coming months to demonstrate a robust and agile commercialism and to lift the whole business by customer focus, modern inclusive working practices and delivering the multichannel leverage of which we speak so often.
In these dark times it takes bravery to be brilliant and simplicity to sparkle. eCommerce should be a constellation, not a lone star: this Christmas, don’t twinkle alone.
Having won a temporary pass from IR Towers to a seaside retreat with cable TV, Ian Jindal is watching Olympic synchronised diving as the rain beats against the windows and thinking of peak season…
The Olympics are an extraordinary event. Not solely for the obvious (and barely-understood) commitment and expertise of the athletes but for the emergence of a new form of human being: Homo Potatum Sofum Expertatis, sometimes known by its common name, the ‘couch potato’.
Being inactive while watching telly is not that remarkable. Rather, it’s the peculiar quadrennial transformation into a sporting expert that defies accepted ideas of evolution. I’d never seen synchronised diving before, but I can note with great accuracy the differences in body line, the perfection of the piked position and the miniscule timing differences in breaking the surface… Humans have evolved to be able to identify tiny differences in patterns, even if most of us lack the ability to make our bodies work to those fine tolerances.
My mind slipped back to thinking about retail, and I realised that the armchair critic is no match for the uncaring, critical, always-right customer!
In the battle to extract cash from the recession-constricted wallets of our visitors etailers are resorting to a near-permanent sale, free delivery, deeper additional discounts… and all the while Christmas is coming and we need to gear up for peak.
Is this our Olympic relay race? We have the highly-honed and much practised disciplines of logistics, buying, marketing and technology, all at peak form after over 4 years of “working” ecommerce. However, if the team play and baton-passing is not the equal of the individuals then the customer notices. “98% performance”” gains no credit for the hard work and expertise: rather, the ‘2% deficit’ is noticed and punished.
Characteristic of the ‘mature stage of ecommerce’ is that customers have now experienced expertise – either from you or (painfully) from your competitors. Unfortunately, the expert etailer gets little explicit praise, save for an increased retention and net promoter [tm] ranking. That retailer’s competitors however suffer silently – the silence of being shunned. Customer may still come to your site, from habit, curiosity or expensive CPA tactics but upon arrival your site suddenly seems to lack lustre, that certain Gold Medal je ne sais quoi, the allure of the champion. Second division. Vauxhall Conference. Amateur.
The first symptom of underperformance is a perplexing drop in conversion rates. Blame the recession, blame holidays, wait for the new season’s stock, fire up another affiliate… Somehow, though, the medal positions are always filled by your competitors… While we all clap politely and are pleased with ecommerce’s resilience – the ‘rise in popularity of our sport’, if you will – it’s of zero consolation to the true competitor, for whom it’s medals or nothing.
With peak season imminent, what are our options? The first point is not to start anything new or risky: this is a time for a perfect drill rather than a practice match. The next is to coach each of your skilled players in working to their maximum capabilities – practice at peak enables performance at peak. Finally, make sure that your training camp includes cross-discipline practice and communication. With high pressure and high stakes it’s all too easy for people to fall back into their own areas and leave the overall problem to ‘someone else’. But as Potatus Expertatis knows, it’s the tiny cracks and flaws that mark the teams down from gold, rather than the the flashes of isolated brilliance moving them up.
Peak success will be from Gold-standard teams, working flawlessly and consistently together to deliver under pressure against the etailing elite. No amount of free delivery and empty promises can win the Christmas Olympics.
To the victor the spoils.
This was my Editorial from the July 2008 issue of Internet Retailing magazine.
The paradigm of the web channel being a vast shop with elastic walls has run its course. As Ian Jindal packs his bucket and spade for the summer holidays, he considers a new etailing paradigm: active selling in the network age. Retailers have managed the web for too long – our customers want it back! Continue reading “From destination to distribution – new paradigms for the networked customer [Editorial in July 2008’s Internet Retailing]”