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By Ajaz Ahmed In Retail Week 2 July 2020
Almost every day there’s another story on Retail Week about a retailer doing things in an entrepreneurial way. But where were all these entrepreneurs before the start of this pandemic? Were they locked in a room and given a warning? “If you come up with anything that is remotely entrepreneurial, we’ll sack you.” Incumbents have always been scared to embrace change. Entrepreneurs are usually disruptors who come in and see the gaps, see things in a different way and look at things from a customer’s perspective. A huge loss in revenue and retailers are embracing the internet with both arms, both legs, and running around evangelising about the power of e-commerce My question is: why have retailers become so entrepreneurial all of a sudden? Why did it take an enormous reduction in revenue for them to look at the world in a different way? I’ve been writing about the internet for many years, and it’s made no difference. But a huge loss in revenue and retailers are now embracing the internet with both arms, both legs, and running around evangelising about the power of e-commerce. Earlier this month, one of the headlines in Retail Week was ‘Boots leans on digital as it prepares to reopen beauty counters’. And Dixons Carphone launched a new service that allows customers to chat to staff in store using a video link to get advice and see demonstrations of the products they’re interested in from the comfort of their own homes. What a truly great idea. CEO Alex Baldock said, “Sometimes crisis spurs innovation.” When I read this, I wanted to run around the room and shout, “Why, why, why?” Why does a crisis spur innovation? Highly paid executives and their teams are supposed to come up with good ideas to move their businesses forward. It shouldn’t require a crisis – that’s why you get paid all that money. Businesses are supposed to pivot all the time. Retailers need to understand that customers don’t say goodbye; they move on and start spending their money with someone else without telling you. Have retailers not learned this valuable lesson yet? It doesn’t look like it. So, how do we change going forward? I think it’s very simple really. If you want to be more entrepreneurial, just start listening to people – listen to the people that work for you, encourage them to be entrepreneurial and tell you their good ideas. But you have to promise to sit and listen to what they’re telling you. Allow people from outside your company to approach you and talk to you about good ideas. When watching Dragons’ Den and one of the Dragons says “I’ve got contacts at retailers”, I’ve always wondered why you need contacts to do business with retailers? Why can’t I go to your website and find a section that says: ‘We want to talk to anybody that’s got a great idea – here are our contact details.’ Why do you make it so difficult for people to talk to you? My advice to you is to stop worshipping Excel and make it easy for people to tell you about new ways of working I once tried to talk to a retailer (a Northern-based supermarket) about an idea. I had to go through a contact and, before even listening to what I had to say, the person said, “You’ll need to go through a credit check.” I was so annoyed they didn’t listen to me that I ended up saying that, unfortunately, I did have some debt. “Sorry to hear that,” was the response. “Yes, I’ve bought two sofas from DFS on interest-free credit and I haven’t finished paying for them.” And I left without sharing my idea. Listen, guys, my advice to you is to stop worshipping Excel and make it easy for people to tell you about new ways of working. You never know – somebody might come up with a fantastic idea that could change the way you do business. Don’t wait for the next big drop in income to listen to people. You can be entrepreneurial even in good times.
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Pulp Fiction is one of my favourite films, it has some amazing thought-provoking lines.
"If my answers frighten you then you should cease asking scary questions." -Jules Winnfield "F*ck pride. Pride only hurts, it never helps." -Marsellus Wallace "Just because you are a character doesn't mean that you have character." -The Wolf "Play with matches, you get burned." -Vincent Vega "Uncomfortable silences. Why do we feel it's necessary to yak about bullshit in order to be comfortable?" -Mia Wallace "You see, this profession is filled to the brim with unrealistic motherf*ckers. Motherf*ckers who thought their ass would age like wine." -Marsellus Wallace "A dog's got personality. Personality goes a long way." -Jules Winnfield "Did you ever hear the philosophy that once a man admits that he's wrong, he is immediately forgiven for all wrongdoings?" -Vincent Vega "Yeah, well the days of me forgetting are over, and the days of me remembering have just begun." –Pumpkin "Look, do you wanna play a blind man? Go walk with the shepherd. But me, my eyes are wide f*cking open." -Jules Winnfield "It's the little differences. I mean they got the same shit over there that they got here, but it's just -- it's just there it's a little different." -Vincent Vega "That's when you know you've found somebody special. When you can just shut the f*ck up for a minute and comfortably enjoy the silence." -Mia Wallace "Hamburgers: the cornerstone of any nutritious breakfast." -Jules Winnfield The last decade saw many famous retailers go out of business, names that we grew up with are no longer with us. Names like Thomas Cook, Toys R Us, Borders, BHS, Staples, Blockbuster, Maplin, Comet, Tie Rack, Pound World, Barrett's and Phones4u.
I don't know if my brother is just unlucky, but he worked at Comet, Phones4u, Maplin, Staples and was offered a job at Toys R Us. I now fear for the future of the shop he currently works in (let me know if you want his CV.) At the beginning of the last decade, many retailers were still in denial and e-commerce was still a relatively small part of most retail businesses. We saw the tipping point arrive and now there's no going back to the old days. I don't think retailers understood what the tipping point meant, and busy town centres that were all hustle and bustle are now more like ghost towns with retailers begging landlords to reduce rents and the Government to change business tax rules. At the same time, more prominent city centres have grown and are busy because peoples shopping habits have changed forever. People are shopping in the bigger cities and shopping centres, they make a day of it by spending time to have something to eat and drink while small towns are empty, void of the big names that people want to shop at. It was simply too late for some retailers, new players came and took their business from right under their noses. New players created brands that sound like they've been with us for many years. Some retailers woke up and embraced diversity, what I mean by diversity is selling products that the next generation and people from different backgrounds want to buy. Selling products in a way that meets the lifestyle habits of the next generation. For instance, Greggs is doing very well by selling vegan food. I'm surprised that other retailers haven't caught on and started selling more vegan food. M&S started selling ready-made halal meals, why did it take them so long to understand Muslims working in city centres want to eat ready-made halal meals, and they want to buy a lot more than the small selection that is currently available. I saw a Pret A Manger in Manchester selling only vegetarian food, what a great idea. These are all example of selling things that people want to buy, it’s not a complicated formula. I'm amazed when I talk to my daughters, who are in their 20s why they buy certain things and where they buy them from. It's not about employing expensive consultants, it's about talking to the people that are not buying from you, these people can give you valuable insights as to what you need to do to become the retailers of choice in the future. The new decade will be very different from the last decade, people are not going to stop shopping or spending money, they're just going to change how and where they spend their money. New names will carry on taking business from old retailer's, people's habits will carry on changing, and to survive you've got to adapt and change, it's as simple as that. I can't predict what's going to happen, all I know is that some retailers will carry on blaming the weather and that change will accelerate, and the answer to what’s going to change is not in a spreadsheet. (I wrote this article for my column in Retail Week.) Just 20 short years ago, the company I founded, Freeserve, launched to an unsuspecting world. At the time, very few people in the UK had used the internet, so few that Microsoft didn’t bundle a browser with Windows. What was the point? Hardly anyone was on the internet.
Fast-forward to today: now we don’t have to plug a wire into the phone socket, your computer doesn’t make that funny noise to log on and you can even use your mobile phone. The internet is everywhere and is part of our daily lives. “New companies have stolen the food from right under the noses of old companies without them even knowing” But, boy, has it made fools of people. New companies have come and stolen the food from right under the noses of old companies without them even knowing it. In a short space of time, start-ups have made gigantic fortunes, while others have lost unbelievable amounts of money. But the sad thing is, for 20 years, some companies have continually talked about the internet and still done nothing. The only thing they’ve done is hired consultants who are good at acting and telling people what they want to hear. Afraid of change What consultants don’t tell you is that people are afraid of change. Because if they tell you that, they won’t get paid. I’ve no idea what was being discussed in the boardrooms of Asda, Morrisons and M&S Food as the directors watched Tesco and Sainsbury’s vans shooting up and down the roads in front of them. Many companies haven’t been successful because they don’t pivot and progress; they carry on majoring in minor things until it’s too late. At the beginning, the internet was a low-stakes place and then it suddenly changed, which meant people had to respond quickly to trends, they had to launch new services, they had to listen to customers’ problems and, most importantly, they had to find where their old customers were now spending their money. I think many people are afraid of what they’ll find when they start looking at their businesses. So, stop asking customers what they want and create something that customers don’t even know they need yet. We can learn a lot from a company like Apple. I was at the launch of the iPod and later the iPhone. I didn’t know I needed those products until Steve Jobs revealed them to the world then suddenly, I wanted to buy one. Stop considering new products, services or ideas as a threat and try to take advantage of them. From low stakes to ultimate risk What’s changed and made the internet turn from a low-stakes arena into something that if you don’t get right, you’ll fall off the cliff? The first thing is that successful companies now know about good design, navigation and technology. The best sites are so easy to navigate that you can find anything within a few clicks, and customers can’t understand why they keep going back to them over and over again. “Stop just using the internet every day and ask: why do I visit some sites more than others?” The other thing is the mobile phone. The mobile phone sucks us in and feeds our addictive desires. On the train, on the bus and even in my house, people are addicted to these devices. If you don’t understand this, you are missing a large part of the equation. To stop making mistakes, dare to ask the most straightforward questions. You won’t sound like a fool because if you don’t get it, your customers won’t get it. Look at other successful companies and try and figure out how they’ve done it and learn from them. Stop just using the internet every day and ask: why do I visit some sites more than others? Look at them like a customer would. What are the next 20 years going to be like? I haven’t got a clue – because if I did, I wouldn’t be sharing it with you. This article appeared in Retail Week 16th August 2019 https://www.retail-week.com/technology/opinion-the-internet-has-made-fools-of-timid-retailers/7032683.article On my LinkedIn profile it says, “All my life I’ve hated consultants, so I decided to start my own consultancy.” So, what is a consultant? I think the best way to describe a consultant is "It’s someone that is consulted for their expertise, advice, or help for a fee."
So, the big question, is it worth spending money on a consultant? Yes, but only if you make more money back than you paid the consultant, and that's the problem. A few years ago, I went to a talk at the Bradford Business School, called - “Do management consultants steal your watch and then tell you the time? Or do they help you and your business?” They talked and talked about all sorts of rubbish with their back to the audience reading from their PowerPoint, the audience couldn’t read or understand the small text, graphs and photos. Halfway through the talk, I thought to myself, "I’ve come here on the bus and so far, they’ve not only stolen my watch, but they’re charging me for telling the time." I then went home on the bus. If that’s the case, why do people hire consultants? I think one reason is something called "Ass Covering." Because if something goes wrong, you can "cover your ass" by telling the boss that someone else advised you by using lots of research, surveys and nice graphs. My experience has been that consultants ask lots of questions, then add lots more words, graphs and surveys to what you told them. They then give it back to you in a bound document and folder, along with an invoice. Many years ago, a large retail chain hired a big consultancy because their sales were going down. After a lengthy and complicated process, the conclusion was that "they need to reposition themselves as more of an internet business." Before spending all that money, the MD could have left his office, walked into a shop, asked the staff or customers and they would have told him “The future is internet shopping and smartphones.” He would have got this without the expensive paper, folder and PowerPoint. I gave a talk to a group of “Professors of Entrepreneurship” at a conference. It occurred to me while I was talking, “None of these Professors have ever started or ran a business.” Is it the same for a lot of consultants? I love Simon Cowell because if you can't sing, he'll tell you "You can't sing," I'm like that, I’m known for being a provocateur, but have I got it wrong about consultants? They can’t all be bad, some maybe, but not all. What do you think? Ajaz Ahmed, Chief Provocateur, Cut the Cr*p. |
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