Premium prices for a premium service? Will having an online shop take away from the personal touch or enhance it?
The BBC recently broadcast a documentary following a year in John Lewis as it combats the recession. The last episode shows John Lewis launching three new types of shops; the new Cardiff department store (the biggest one in Wales), John Lewis at home store and a new website for online shopping. The documentary shows how they are trying to find their feet in the twenty first century whilst retaining brand identity.
The new Cardiff store was commissioned pre recession and it stands for the heart of a brand nearly a hundred years old, but this mode of shopping is slightly outdated. Demand is no longer there, as the Internet offers boundless space for shopping. The Internet now acts as the world’s biggest department store, one space for all consumer needs. Department stores are no longer required, recognising this John Lewis has started a new venture; John Lewis at home.
As early as 2005 John Lewis’s online store was one of Britain’s top five online retailers. Last year the online store was earning roughly £100 ml more than their flagship Oxford Street store. Bearing these figures in mind they decided to revamp and expand their website dramatically. For the first time they have a range online that will match range in store maximising their online presence. Wanting to keep the personal touch of the brand John Lewis has put helpful videos on their website that informs the customer more about the product. The profits are sure to soar but will customers still want to pay for a virtual service?
Two sets of customers were followed in the documentary, showing their shopping experiences. The first lady went to John Lewis to check out the products receiving help and advice from an employee with a no pressure to buy attitude. Later it transpires she purchased her goods online from a rival company. Considering she bought the products from an online company she states somewhat naively that stores will always be there to look at the products before buying them online. Looking at her purchasing habits this may not always be the case. She wants the premium service without paying for the products, unfortunately business’s cannot survive on thin air. She maybe benefiting from the best of both worlds at the moment but will this attitude cost her in the end?
At the other end of the spectrum the documentary follows the silver surfers as they are affectionately known, buying a new kitchen. They prefer to look at the items online before going in store to buy them, saying that buying online does not give the same experience as buying in store. They use the internet to research products and making sure they are in stock instead of potentially having a wasted journey to the store and leaving empty handed. Buying their kitchen in store gave them reassurance, even when the fitting of the kitchen there were always employees on hand to help. As Andy Street, Managing Director of John Lewis says near the end of the documentary that he thinks the online shop will enhance customer experience, in the case of these two silver surfers he is right.
Customers clearly still love the personal touch but unfortunately for John Lewis not all are willing to pay premium prices. The new digital native generation has been brought up with ‘free’ and the internet provides so much for nothing.
Can John Lewis persuade this generation that quality of service costs? The senior management is so caught up on the brand identity and giving ‘the personal touch’ they haven’t considered that customers might not want to pay for it any more. Only time will tell as John Lewis ventures forth into the new millennium.
Nicola Radin is a freelance writer based in Manchester UK