Back to Basics

Back to Basics

In the four months or so that I have been setting up my own business, some exciting changes have been taking place in the retail sector. My move from large firms to small has given me a different perspective from which to observe these seismic movements, of which the most highly visible has been the response of the UK’s largest supermarket chain to the “perfect storm” of financial woes compounded by the unceasing rise of the discounters.

The customer is always right, and the flight to a more basic shopping experience has been remorseless, forcing a rethink by the Supermarket chains around their offer to their customers. Back to Basics is a well-used term, but represents exactly what these organisations are attempting. Tesco is busy divesting itself of as many of its non-core businesses as possible, Homeplus, Blinkbox, Tesco Broadband and Dunhumby, the data company, powering its Clubcard scheme.

Tesco is not alone in this response to the lean and mean, no frills approach by Lidl and Aldi, and there is recent news that the retrenchment of both business diversity and product margins may be slowing their inexorable rise in the UK.

An interesting effect of this “Back to Basics” approach by the besieged supermarket sector has provided rather a shock to the large companies that provide retail hardware and software innovation to accommodate the historic growth in this area. Morrisons, who had placed much faith in using technology to underpin its position in the UK retail ranking, asked its customers what they did and didn’t like about their stores. The result will have surprised all the vendors of hi-tech. The company, having already scrapped automated queue management, discovered that the customers’ responses indicated that they did not have much faith in self-checkouts. Morrisons’ response was immediate, introducing manned, express checkouts for customers with 12 items or less. Inevitably this will lead to lower requirements for self-checkouts.

It has always been my contention that, if retailers don’t interact with shoppers on the customers’ terms, they will lose their loyalty and custom. It was fascinating to see that this decision came about through asking customers. Perhaps the providers of retail hardware and software also need to talk to the end user, before their market shrinks

David Lowrence

Posted by St. Marlowe

Semi-retired IT Consultant in the retail sector. Currently Chair of the Saints Supporters' Club, and purveyor of Fine Olde Websites to the County. Come On You Saints

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