Testing Technology in Tottenham Court Road

main logo blueIn the latest of my occasional store analysis outings in association with Shoppertrak, I visit one of my old haunts in London, checking on the some of the huge hi-fi and technology stores in the capital’s main street for technology addicts to see if their stores are as cutting edge as their products.  I include some independent stores as well as one that would probably be familiar to everyone.  The results surprised me and point to a number of areas where some old fashioned personal service wouldn’t go amiss amongst all the impressive gadgetry.   

Whilst visiting most of the major mobile phone retailers in Tottenham Court Road in preparation for my last Undercover Analyst post, I found myself drawn into a trip down memory lane as I eyed some of the older technology stores in the area.

As I said in my previous post, back in the 90s if you wanted the latest slab of shiny consumer technology there really was no better place to come. I was a frequent visitor. In fact it was only a few years ago that I switched from a TV I bought there 25 years ago, and that was only because of the digital switchover. I like to get value for money out of my purchases!

Everything had changed of course, as you’d expect in the world of modern gadgetry, but many of the stores had a familiar layout and a good deal of the sales pitch was pretty much the same as it had been in the days of tower systems and VHS.

Having just taken notes on some of the most cutting edge gizmo stores on the market, I thought it would be good to see how the more traditional technology retailers were doing, if there is such a thing as ‘traditional’ technology.

The first store I visited store predominantly sold Hi-Fi gear. I’m not sure if calling it that is now an anachronism, but I enquired about a sound system anyway. The sales adviser seemed very knowledgeable and had an impressive amount of product knowledge to call on. Buoyed by this initial encounter, I asked if I could perhaps have a demo of the system and the salesman’s face lit up. All I had to do, he explained, was to visit their demo area on the third floor where someone would be happy to help me.

Missing Link

This is where the experience took a disappointing nose dive. I wasn’t escorted to the demo area, I was just told where it was. This seemed like serious missing link in the service chain to me. Most stores, most notably the large supermarkets, now train their staff to take anyone who enquires about a product to where they can find it. Just sending someone risks that person not finding it or changing their mind in transit. It also gives a rather offhand impression of the service model.

pointingJust pointing someone in the general direction is acting like a signpost. Leading someone to the product is a positive interaction with the customer and keeps them engaged. Moreover, in this case I was supposedly interested in an expensive sound system, not a bogoff on a tin of baked beans. It could have been a very costly mistake for this store. My maxim to staff is always ‘guide, don’t point’.

Once on the third floor it took a while to catch the eye of the assistant, who apparently had no idea I was on my way. Even a phone call from the ground floor warning them of my impending arrival was clearly too much to ask. A totally cack-handed way to operate a sales handover in my opinion, and something they really should work on.

The demo itself went well and I felt the adviser really knew his stuff. But the way I’d had to pretty much drive the process to get there myself left me feeling disengaged by this point. I think, had I been a real customer I might not even had got that far.

Overall though, not a bad store, but some serious service issues to deal with.


ShopperTrak says – How are customers moving around the store? Gaining an understanding of how shoppers are moving around the store can help to ensure that shoppers don’t miss out on any stock as well as making the most of product placement.

I.e. retailers may find that customers are regularly coming in to the store to purchase small items such as headphones but that they are experiencing a high abandonment rate once shoppers realise that these items are located on the third floor. By moving headphones to the till area, the retailer may see a boost in conversion rates.

Retailers can also look to data to monitor the success rate of implementing new changes, i.e. staff radios. I.e. did conversion go up when staff began using radios to communicate across different floors? They can then tweak these changes accordingly.


My next visit was to a well known electronics supplier. This store sells a variety of less well known brands but is a seriously great place to come for anything from a walkie-talkie to a GPS enabled swizzle stick. I have to admit I could, and probably have, spent hours browsing amazing gadgets that I’d never heard of whilst desperately trying to find a justification for buying. Luckily for my bank balance I usually fail.

Plain Vanilla

Having said that, it’s a bit plain vanilla in terms of shop layout and fit-out. It looks like the store was built around off-the-shelf shop fittings bought in a clearance warehouse at the end of the 1990s. I’m sure that wasn’t the case, but it was not exactly what you’d called ‘retail theatre’. Slightly incongruous for a shop selling up-to-the-minute products, but maybe they think the merchandise is exciting enough.

vanillaThe stock displays were neat enough and everything was easy to browse. Staff were around and someone from the back of the store shouted across to me to ask if I needed any help.

To me that’s an approach that’s about as contemporary as the shelving was in the store. If you’re going to engage with a customer, do it face to face and with some commitment. Throwing your voice across the shop is also throwing away a golden opportunity to turn that interaction into a sales opportunity. In many respects it would be better to say nothing than do that. Having come from several stores with a much more focussed customer service ethos, even though it was probably poorly executed in some cases, this seemed like a bit of a throw-back.

Again not a bad store overall, but still lacking that certain something.

My final visit was to a store that today stands pretty much unchallenged in the landscape of UK technology retail today. It’s my policy in these articles not to name stores, but I’m sure it won’t take too much of a leap of imagination to work out the name. It houses a number of concessions and has a wide range of different brands on offer. Indeed it recently merged with another equally ubiquitous high street retailer.

There were a lot of staff about, but oddly many of them appeared to be cleaning staff. They were adorned with Hi-Viz jackets and were busy with cleaning tools. It seemed to me to be an odd time to be cleaning as the store was fairly full of potential customers. I’m assuming it was an outsourced company, but if it had been my store I wouldn’t have wanted to see them on the shop floor during trading hours.

There were numerous sales staff floating about, but it was difficult to get their attention. One of them seemed to deliberately avoid my gaze. I have to say I’ve had this experience in the past in these stores, and it was a behaviour they were at one time famous for. I understood it had been ‘trained-out’ of staff after an extensive re-branding effort a few years ago. Maybe this guy had missed the seminar.

Technical Problems

Many of the products on sale had a demo facility, which was a great idea, except for the fact that most of them appeared not to be working that day. When I finally did manage to capture a member of staff they explained that they’d been having technical problems, so perhaps I just picked the wrong time. Once we did get some of the demonstrations going they were generally a good sales tool.

I must admit I wasn’t particularly impressed after my visit and did notice a customer satisfaction button by the door on the way out. I’ve noticed these are becoming more popular now in larger chain stores, although I suspect the data they provide will be about as qualitative as badly implemented footfall counters. On this occasion it was placed slightly behind the door so I’m not sure many customers would have seen it anyway. Perhaps an indication that the store staff were not particularly keen to see them use it.

I’d previously seen improvements in this company’s customer service performance so it was a surprise to see they’d started to slip back into their old ways. Perhaps having less competition leads to complacency.


ShopperTrak says:

• It would be interesting to use heat maps or beacons to map out key areas and understand which concessions are drawing in shoppers. By doing so, retailers can gain insights into the customer journey and how shoppers are moving around the store, as well as store layout, staff allocation etc.
• An understanding of your busiest periods means that retailers can use their least busy times to carry out staff training and cleaning for example.


robot

“Take me to your checkout!”

So there you have it. Smart gizmos not always being sold in a particularly smart way, which considering we’re talking about highly advanced products seems something of an irony.

I was at a conference a few months ago where the concept of robot salespeople was being pitched. It’s not as outlandish as you might think either. These robo-shop-assistants were based on a Japanese designed personal helper droids intended as home help for infirm people. Apparently they cost around a thousand dollars and are easily re-tasked to the world of retail. Maybe we’ll see these in our high street stores in years to come, and I think it would be a good bet that the first place would be in a technology store.

I’m not sure if that says more about retailers than it does about the evolution of artificial intelligence. But as I saw on my travels around mechanical Mecca, there may well come a time when it will be difficult to tell which gadgets are for sale and which are doing the selling. In some instances I don’t think that would be a bad thing.

For more information and insights from Shoppertrak, click the logo below and subscribe to my blog for future posts from The Undercover Analyst.  I could be coming to your store soon!

Phones 4U – The Winners And Losers

phones 4UThe announcement by Phones 4u’s administrator Price Waterhouse Coopers that it is closing 362 of the retailer’s stores permanently really is an appalling outcome for the 1697 store staff who now find themselves out of a job.

I feel very sorry for these people at the sharp end of what seems on the face of it to be a rather sordid tale. I know from speaking to some of the employees that most had absolutely no idea that their jobs were balanced on such a knife edge, and from what I understand from other reports, senior management had little inkling either.

Perhaps they should have had though. Certainly the company’s main investors could have shown a little more sensitivity to the likely outcome of negotiations with the four main carriers when they explained that they weren’t able to offer competitive terms in the face of a mountain of debt that needed to be serviced. Especially as a good deal of that debt was apparently self imposed as a result of some rather creative financial arrangements.

Equally Vodafone and EE should perhaps have considered the impression their actions would give to their own customers when they, fairly unceremoniously, pulled the rug from under a long-term business partner. Perhaps they weren’t prepared for Phones 4U management to take such drastic action. I know I was personally flabbergasted at how easily they appeared to give up the fight when the Vodafone contract had another 6 months left to run and EE’s wasn’t due to expire for a further year.

Most businesses would have kept trading and explored other possibilities, probably including some hasty re-trenching and fence mending with all the carriers. Of course I’m not privy to all the reasons for their decision to go into administration so eagerly, but it seems to me that a business with over a billion pound turnover and profits in excess of £100M might have been worth a little more effort than a press of the nuclear button without further attempts at diplomacy. I’ve certainly seen many much smaller businesses struggle to stay afloat for a lot longer than these guys.

Easy Money

Maybe that’s the problem. For those companies already staked in the game, the mobile phone business has been seen for some time as easy money. The phones and tariffs are laid on by other companies and an obliging public pitches up every time one or the other produces another subtle flavour of hardware or call package that in essence does the same thing as the last, only slightly better. These carefully stage managed increments keep the punters hooked and the cash rolling in. Perhaps when things got a little tougher than that for the board, it’s just wasn’t worth the trouble.

Now the very same carriers that precipitated this situation are reportedly picking off the juicier fruit from the P4U property cherry bowl for their own standalone stores. After an epiphany, undoubtedly born of the internet, they’ve discovered that cutting out the middle men means the money tree just grew a bit taller.

It’ll be interesting to see if tariffs are reduced accordingly now there’s one less bite out of the pie. But somehow I doubt it, especially as most of the carriers have of late been furiously re-writing their contracts in ways that haven’t been particularly advantageous to their customers. And let’s not forget that, with a reduction in competition on the high street, the consumer is going to have less opportunity shop around. As the carriers take more of a direct sales approach, the choice will be limited to service and coverage rather than tariff with fewer independent resellers to stir the pot.

I suppose grabbing the tastier morsels of the Phones 4 U portfolio is a pragmatic move, but it still looks like opportunism born of fancy footwork on their part. In the final analysis the people who have, justifiably or not, pulled the plug are now picking over the bones of a business that previously appeared to be thriving.

A Dream Outcome For Dixons Carphone

Dixons Carphone don’t come out of this smelling like roses either, even though I suppose they can’t be held accountable for the actions of their own suppliers, it does look like a superlative bit of luck on their part that shortly after announcing the closure of 160 Phones 4U concessions in their Currys stores, their main competitor loses all support from their mutual partners. I’m not suggesting there was any collusion involved, but it does seem like the kind of dream outcome that many a rival company would have to pinch themselves hard to believe.

To be fair, Dixons have offered jobs to many of the former concessions staff, which does of course also provide them with a ready made workforce. They’ve also been making efforts to acquire a number of the Phones 4U locations and have been promising jobs for the staff involved in those locations. However it’s understood that the administrators have been less than enthusiastic, so one can only speculate as to the kinds of offers Dixons Carphone are making for the properties. Dixons taking over the stores could of course safeguard of a number of jobs, but they still stand to gain a lot out of the deal themselves.

bad smellThere were undoubtedly a lot of contributory circumstances leading up to this meltdown, but it still leaves a very nasty taste in my mouth and a hell of a stink under my nose. A ludicrous situation and a sad outcome that could have been avoided at so many key points. I only hope all parties concerned, including the P4U investors and management, the carriers, and Dixons Carphone are as uncomfortable about all this as I am.

Although I doubt any of us will be as uncomfortable as the store staff and their families who suddenly find themselves without an income so close to Christmas.

The Undercover Analyst – How Focussed is Fashion on the High Street?

main logo blueAs part of a new project in association with retail analytics experts ShopperTrak, I’m going to be looking at the retail landscape in areas around the UK and sharing some insights through regular blog posts. Taking a broad cross section of market sectors and visiting specific but unnamed stores, I’m going to be commenting on how they fare on certain operational areas identified by ShopperTrak as being key to a successful and customer responsive store. I’ll be looking for good and bad practices, innovative ideas and exemplars for all of us to either follow or avoid in our own businesses.

My starting point was my home town of Oxford where I looked at mid-range high-street fashion. I’ve run stores in Oxford myself for nearly 20 years so I’ve witnessed the evolution of the local commercial environment at first hand.  The central retail core in Oxford is not much larger than you’d find in any town centre high street and consists of three main shopping thoroughfares, two indoor shopping centres and a covered market catering almost exclusively for independents. The main shopping street is Cornmarket, where most of this survey was based. Around six major stores were visited each with large footprints and each selling quite similar products to a broad demographic of fashion conscious 18-35 year olds.

Same difference

910484_23238014The overriding impression across most of the mainstream stores was that they all bought their shopfits from the same generic contractors. With the exception of one store, well themed towards their target customers, store layouts were similar to the point of duplication. It may be the nature of the beast that there are only so many ways you can support a clothes hanger, but shop-fittings generally looked like they were ‘off the shelf’, even though I’d imagine they weren’t.

Considering the size of some of these companies and their large marketing spend, brand identification in some stores was not as strong as it should have been. You could have dropped me blindfolded into any one of these stores and I’d have had a hard time telling you which one I was in.

ShopperTrak says : Differentiation is key. Location-based analytics provide retailers with the tools they need to understand the customer profile better, especially how shoppers are moving around the shop floor. As Ian points out, many stores have similar layouts but this is often down to guess work rather than knowing exactly how customers are moving through the store. Understanding the customer journey improves the overall experience so retailers need to have an accurate view of what is happening in store to help them measure effectiveness and constantly make improvements. By doing this we may see an end to all stores looking the same.

SALE SALE SALE!

Some of this anonymity might have been down to the fact that it appeared to be the height of the summer sales in the hallowed city with the main shopping areas a sea of red and white signage.

These days it’s quite difficult to pick out more than 2 consecutive weeks when someone isn’t on sale. The necessity to strip window and internal displays down to the bare-bones during such promotions left no real indication of how attractive the window dressing would normally be. Window displays have somewhat fallen out of favour in recent years, dividing between the bog standard or the eye-popping retail theatre. Of course your window display is supposedly the thing that draws customers inside your store, so outside of sale periods it has to be an important consideration.

ShopperTrak says : Traffic patterns change over different periods – particularly so during a sale. Even though the store feels busier retailers need to be sure that their promotions are actually driving the maximum number of customers to make a purchase. By analysing draw rates, or the ability to bring people into the store, retailers can measure whether promotions and merchandising are helping to entice their fair share of shoppers over the threshold versus competitors. If the draw rate begins to fall it’s a sure sign that visual merchandising is not working as effectively as it should be.

Location, Location, Location!

Internal store layouts seemed to be quite ad hoc. Most large stores use pre-planned merchandising plans produced by head office but none of them seemed particularly well suited to traffic flow in store, neither did they look like they could be responsive to dead zones that were fairly evident. For example, retail environment guru Paco Underhill has identified the area around your main entrance as the ‘landing pad’. His suggestion was that nothing should be placed here as customers are usually looking further into the store to see where they were headed. That seemed pretty much the case in one store where a large gondola had been plonked right in the entrance-way – it was pretty much ignored by everyone coming through the door.

1215579_52407894The other obvious fail in my opinion was the tendency to place items that were in the sale at the back of the store. The intuitive logic is of course that this will draw customers further into the store, presumably wowing them with the non-promotional stock on the way. Personal experience combined with this particular visit tell me that this strategy is far too simplistic. Most customers looked straight to the rear of the store and bypassed everything else on their quest to get to the cheaper goodies. There may have been a method in this apparent madness. Keeping the sales hysteria at the back of the shop along with the associated mess and mis-matched merchandise may be a good move in some cases. Also I guess there’s a chance that customers may give the full priced stock another look on the way out after perhaps finding nothing in the sale to their liking.

In these days of eye-watering rent and rates, customer flow within a store is something that needs careful analysis. It’s really not something that can be left to gut instinct or rigidly pre-planned merchandising charts.

ShopperTrak says : Heat maps help retailers determine which areas customers are dwelling in and how long they spend there. This is crucial when analysing the effectiveness of merchandising and product placement. It also enables stores to re-invigorate quieter zones or analyse changes to determine the optimum store layout. On a micro-level retailers can examine conversion rates within specific areas of the store to gain a deeper level of insight into overall performance.

Customer experience

The general customer experience in all but one of the stores visited was pretty good. Stock displays were generally well maintained, apart from one rather tired looking mannequin that personally I’d have pensioned off years ago.

One of the more mainstream stores was a fairly recent opening so had the benefit of newer merchandising displays. This certainly gave a fresher look which was enhanced by the large airy feel of the store. They also had a good layout of stock with accessories and handbags at the front where they can be easily browsed and selected ‘on the hoof’, with items such as shoes at the rear where more time and interaction with staff would be required. However here, as with all the stores visited, staff engagement with customers was nigh on non-existent. Perhaps the labour intensive nature of the display floor meant that sales adviser’s saw maintenance of displays as a higher property than talking to customers.

Personally I’ve always trained my staff to aim at somewhere between intrusive and attentive. Many of the stores I visited could have benefited from tasking particular members of their sales teams with approaching customers on a one to one basis. There’s an obvious ethos with many of these stores that it’s self-service and customers only receive service when they ask for it. But these shops are semi-aspirational in design, they’re not supermarkets. They’re selling desirable fashion, not tins of sweetcorn. In that environment there’s nothing worse than leaving customers with the impression that interaction is bottom of the service remit.

827556_46291532In general though customer service was OK. We saw one person leave a pay point empty while a customer waited patiently, which wasn’t great, but as it was our fault for sending them on the hunt for a different size of a T-shirt that might be an unfair observation. It’s a dilemma for any sales adviser when there’s only one of you but two people who need your help. Perhaps something that could be sorted with better planning of staffing patterns.

ShopperTrak says : Understanding how many people are coming in to the store and which areas they’re dwelling in is a crucial reflection of the overall customer experience. Increasing the average time that shoppers spend in store helps to drive both conversion rates and average transaction sizes. If they stay in the shop longer it means they’re having a better experience.

Retailers can use interior analytics to measure dwell times, looking at whether shoppers are spending the right amount of time in the right areas, how staff are engaging with customers, how well queues are being dealt with or how effectively promotions are working.

Messy but busy

Only one store had significant queues at the pay point and this was also the store with the most untidy shop floor. Perhaps an indication that tidy displays don’t necessarily mean better sales. Or maybe the trashed shop floor just shows how busy they were. However they seemed to be a victim of their own success with at least one case of abandonment being observed as customers tired of waiting to part with their hard earned cash. Again I suspect proper deployment of staff and maybe a re-think on merchandising strategy would help with problems like this.

ShopperTrak says : Retailers need to have an accurate view of their power hours – i.e. their peak selling times. Only by having insight into this can they plan accordingly. Any re-stocking or staff breaks should take place outside of these times in order to ensure the most effective shopper to assistant ratio. Put simply, the fewer the staff available in store during peak traffic times the worse the customer experience is going to be.

As a first outing it was an interesting exercise for me. There are obvious compromises between function and form and many competing demands on the time of the floor staff. But there were many obvious improvements that could be made, perhaps with the assistance of some location-based analytics, particularly in terms of customer flow data and staff movements.

Join me next time when I’ll be looking at how luxury brands fare.  In the meantime you can check out ShopperTrak’s full range of analytic services by clicking the link below.

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Let’s Not Plan Any Retail Street Parties Just Yet

bunting_2242499bFor many retail and economic pundits the term ‘anal-yst’ seems very apt.  So many of them seem to talk out of their backsides that it’s rare for me to find one that I agree with in broad terms.

Jon Copestake is one such individual, and I frequently find myself in agreement with the majority of his comments in Retail Week Magazine.  His comments today – Despite optimism, a UK retail recovery remains fragile – are no exception.

Along with many others, he’s quoted the LDC and Springboard figures that show a very tiny improvement in high street vacancy rates as part of the general consensus of optimism that seems to be building.  There were equally modest positive increments in retail sales figures which, whilst being better than expected, are still in the order of 1%.

Last week we saw breathless reports that the nebulous and somewhat metaphysical indicator known as ‘consumer confidence’ had finally recovered from the negative position it had been in for 10 years.  We were presumably expected to rejoice that this number had now reached a big fat zero, all of us clapping with one hand whilst frantically grasping handfuls of straws with the other.

Having spent a small portion of my academic career designing questionnaires, I’ve never been convinced by such a slippery concept.  Quite what real use a number based on asking a select sample of people if they’re likely to spend a few quid in the coming weeks is supposed to be eludes me.  I think it’s more something that retailers and investors cling on to as a comforter, intended to give the impression that we know the unknowable – the inside of a consumer’s head.

It’s hard to ignore the conclusion that the effort we all put it to predicting doom and gloom around the time of the collapse ultimately led to a self fulfilling conclusion.  But now we seem equally eager to ‘big up’ minuscule vacancy level movements in the order of 0.5% or a 0.4% – which in statistical significance terms are pretty much static – as evidence that good times are just around the corner.

The overall assessment from many retail analysts is that we’ll never see a return to the heady days of the early noughties.   ONS figures suggest that even though wage growth has edged ahead of inflation, most households are still around 10 years behind in real terms spending power.

Even if wages do rise in real terms there are just too many other ways for people to spend money now, assuming the average person ever really gets back to a point where they’ll feel they have the cash to splash around.  Factor in an ever imminent increase in mortgage rates, along with another housing price boom and the whole scenario starts to take on the familiar twists of the path that led us to disaster last time.

There are so many artificial factors driving the so-called recovery I think it’s far too early to be planning the next major roll-outs.  Low interest rates, the property bubble being inflated by government help to buy schemes, changes in weather patterns, even mis-sold PPI payouts are all shifting winds blowing across the sands of the retail landscape.  And we all know where building on sand gets us.

Whatever the numbers are based on there seems to be a mounting roar of expectation that the bunting will be out for a great big retail street party any day now.  Something of a turnaround from the interminable reports of the exact opposite a couple of years ago.  Personally I’m far from convinced that what we’re feeling are the positive winds of change and more worried that the rush of air could just be the prelude to another almighty slap right in our over-eager little faces.