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Seven multi-channel retail success stories

Over the past year, the release of sales and trading statements reveal the advantage that multichannel retailers have over their pure play online rivals.

For example, the IMRG Capgemini e-Retail Sales Index for March showed the widening gap between multi-channel and online-only retailers. Those retailers with a presence online and offline experienced average growth of 19% compared to March 2010, while online experienced just 6%.

We take a look at some recent sales figures for some of the UK’s multichannel retailers. ...

Dixons Retail
A shift to a multichannel strategy has helped Dixons Retail, which operates the Dixons, Curry’s and PC World brands, to compensate for a decline in purely online sales. While online-only sales fell by 9% for the year ending April 20 2011, multichannel sales grew by 12% across the three retail brands.

Debenhams
Sales at Debenhams Direct increased by 82.4% to £92.3m in the six months to February 26 2011. The retailer has been working hard on its multichannel strategy, and growing numbers of customers are using services such as in store ordering and collect from store. In addition, Debenhams has created mobile commerce apps for iPhone and Android, with the iPhone version bringing in £1m in sales in the five months after launch.

John Lewis
John Lewis has been extending its multichannel efforts with the launch of several smaller, John Lewis at home stores. These store have a smaller range of stock, but contain customer kiosks so that people can shop from its entire range. It has also extended its Click and Collect service, and customers can now order online and pick up items from any John Lewis branch. The retailer also launched a mobile website last year. Johnlewis.com achieved sales of £538.2m, up £147.9m, or 37.9%, and well ahead of expectations.

Home Retail Group
Home Retail Group, which runs the Argos and Homebase brands, is the second largest online retailer in the UK, with 400m unique visitors in the year up to February 26 2011. Multichannel sales grew to £1.9bn in the same period, representing almost half (46%) of its total sales. Internet orders represent 36% of Argos’ total sales, up from 32% last year, with the remaining 10% of multi-channel sales being products ordered either in-store or by telephone for home delivery. Argos also launched an iPhone app in May 2010 Argos, which achieved more than 1.3m downloads up to February, and has driven around 1% of total sales. Future plans include the introduction of a TV shopping channel and mobile apps for iPad and Android.

Next
Sales through Next’s retail outlets fell by 2.3% in the year ending January 2011, but this was offset by an increase in Next Directory sales of 7.1%. Next Directory sales include online, catalogues and telephone sales, and were responsible for 27% of total group sales, and 40% of group profits.

M&S
Total M&S group sales rose by 2.3% in the 13 weeks to April 2 compared to the same time last year, while UK sales rose by just 1%. Like-for-like UK sales rose by only 0.1%. M&S Direct, which includes the retailers online and mobile and collect in store services, grew sales by 13.7% during the same period. Over the last year, M&S has introduced a mobile commerce site as well as rolling out its Shop Your Way multichannel service.

Tesco
Tesco’s annual financial statement included a pledge to ‘become a multichannel retailer wherever we trade’, and the retail giant has been launching several multichannel services over the last year, including an iPhone app which accounted for 12% of customer traffic. Tesco experienced double digit growth in the grocery delivery business and a 30% rise in sales at Tesco Direct.

Source : Graham Charlton - econsultancy.com
http://econsultancy.com/us/blog/7719-seven-multichannel-retail-success-stories-2

29 June 2011
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