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Kingfisher's JJ Van Oosten Talks Stores And Online Retail

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The need for speed: what the past year has taught us about using stores to accelerate online retail

Meeting a sudden 300% increase in online demand from customers at the start of lockdown taught us three new things: 

1. Stores bring speed and scale 

A physical store provides proximity to the customer. And with proximity you can be more agile when it comes to how you fulfil orders. Same day click & collect, lockers, and faster home deliveries are all possible from an established store network. That can’t be said for the online pure plays. Large online marketplaces have scale but not the agility required for same day fulfilment, and online pure players served by central fulfilment centres lack the store network needed to scale fast or deliver to customers on the same day.

Ultra-fast delivery of ad hoc orders at a few moments’ notice is an increasing trend that we’re seeing among established retailers and start-ups. Tesco’s Whoosh is a superfast service offering deliveries within 60 minutes. And Gorillas, Getir and Weezy are moving into the online groceries market alongside Deliveroo and Uber Eats who are already acting for the likes of Sainsbury’s, Asda and Morrisons. 

We’re meeting the growing customer need for immediacy too, by trialling Screwfix deliveries within the hour by Gophr in Bristol. And some of the world’s biggest names in retailing are moving into micro-fulfilment – such as Carrefour and its relationship with Exotec in France, and Walmart with Alert Innovation in the US. 

2. Don’t forget the foundations

The surge in online demand for our products remained constant throughout the pandemic. That placed a huge focus on the technology that sits behind what the customer sees online, and the logistics needed to maintain stock levels. Using stores as hubs to meet in-store click & collect and home delivery orders needs a rethink of how you’re going to manage stock. Stock accuracy has to be tighter and replenishing routines need to be rethought so that the customer view of stock availability matches the colleague view in the store when it comes to picking an order. Without it, your promise of click & collect in one hour or home delivery goes out of the window. 

We also continued work on major upgrades to IT systems  across Kingfisher to support our growth. This is already helping to drive increased website conversion rates, a better customer mobile journey, and a smoother click & collect and home delivery experience for B&Q and Castorama France customers. By getting the right foundations in place, we’ve been able to multiply our capacity to handle online orders, enabling a 158% increase in Group e-commerce sales in the 2020/21 year, and a 200% increase in mobile orders. In just one week in the summer of 2020, our systems managed 1.5 million online orders. 

3. Control the fall to learn to run 

A fear of failure – or falling – can stifle growth, as can striving for perfection from the outset. What’s important is to learn to fall, that’s actually how human beings learn to walk and run. Our teams have risen to huge challenges over the past 18 months. There have been many times where things could have gone wrong, or resulted in disruption for customers, by moving at such speed. But going slowly isn’t an option when people need to make a home warm, safe and secure. We’ve learnt more by necessity to move fast, try new things and learn from the outcomes, than to aim for immediate perfection.   

It’s this mindset that has  brought our customers across Europe new services and ways of  shopping that simply weren’t available 18 months ago, from drive-through, click & collect, to faster online ordering and parcel collection lockers. Today, online orders account for around 20% of our total Group sales, compared to just 8% in 2019/20. 92% of those online orders were picked in-store. Our stores function not just as a place for customers to browse and purchase products, but as a highly efficient logistics network that can get products to customers’ homes, fast. 

Now, the goal is to improve customers’ experience even further. We’re working on ways to expand our mobile apps, create even faster delivery options for the last mile, and integrate even more services into our offering for customers - from project advice to help finding a tradesperson through services like NeedHelp - so that we can be with them whenever they need us on their home improvement journey.

#PoweredByKingfisher #ecommerce #onlineretailing #NeedHelp #marketplaces #digitalmarketing

Watch Kingfisher's e-commerce video strategy here.

Source : JJ Van Oosten, Chief Customer and Digital Officer, Kingfisher

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29 July 2021

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