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
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.
This column first appeared in Retail Week.
Is it the customer’s fault? No, it’s not. People have been telling retailers for years that the internet is going to affect their businesses. I can’t understand why it’s come as a shock to them.
The internet boom started more than 20 years ago. For years people had talked about ecommerce, or internet shopping, but nothing happened.
Smug people said to me then: “I told you so.” Then, perhaps many years later than expected, companies such as Amazon really made an impact and the ecommerce boom started.
“Retailers relaxed because at the time it still didn’t seem to cause them a big issue”
And then people said ecommerce would have a significant effect on the high street, but nothing happened, and the same smug people said: “I told you so.”
Now it’s killing the high street. It just took a bit longer for things to change and in that time, retailers started to relax. That’s the problem – retailers relaxed because at the time it still didn’t seem to cause them a big issue.
We are now awash with disruptors who typically adopt new business models that are different from the incumbents, models designed to appeal to customer needs. Simple really, the formula for success has always been the same.
The disruption theory is that alternative companies grow market share by starting from the edges of a market, then they work their way up and into higher-value sectors.
Then, at a certain point, the established company collapses, and the challenger becomes the new incumbent. Simple.
The truth is that the new generation has caused retail to go over the tipping point. Older people like me use the internet in a different way to younger people who have grown up with it.
The thing that changed everything was the smartphone. Wherever you go, people have a smartphone in their hand. People are addicted to it. Go on a train or bus, and people are looking down at their phones, even when they are walking down the road.
We’re in a panic when we can’t feel our smartphone in our pocket or bag. This tells me everything. Companies that are doing well are the companies that know how to exploit smartphones.
“The new generation not only live on their smartphones, but they also don’t think twice about returning something if it’s not right”
Another thing that changed is the new generation not only live on their smartphones, but they also don’t think twice about returning something if it’s not right.
Older people don’t like to send stuff back, but younger people don’t have a problem doing that. I’ve got three teenage daughters, and there is a constant stream of parcels delivered to the house and also things being returned.
Finally, Marks & Spencer in my home town is one of the stores due to close. Since the announcement, my mother has been reminiscing about the old days and wants to visit the store before it closes. The problem is that she never shopped there before the announcement of the store closures. Does that sound familiar?
The smartphone generation never bought there, so they’re not going to reminiscence about Mark & Spencer closing down – they spent their money using phones while they were on the bus or on the train.
So, the big question is, for the people who work at these big retailers’ head offices, are they still using flip phones? Have they been walking around blind?
One of the first big Internet companies was my company, Freeserve, it launched 20 years in 1998, and then the Internet boom started. For years people talked about e-commerce (now called internet shopping,) but nothing happened. Smug people said to me, "I told you so," many years later than expected, companies like Amazon finally came onto the scene and then the e-commerce boom really started.
Then people said e-commerce would have a significant effect on the high street, but nothing happened, and the same smug people said, "I told you so." So, has the tipping point finally arrived? Yes, it just took a bit longer for things to change and in that time, people started to relax.
We are now awash with disruptors who typically adopt new business models profoundly different from the incumbents, ones designed to appeal to the customer needs, simple.
The disruption theory is that alternatives suppliers grow market share by starting from the edges of a market, then they work their way up and into higher-value sectors. Then at a certain point, the established supplier collapses, and the challenger becomes the new incumbent, simple.
Retail Week is busy with stories of doom and gloom in the high street. We’ve been talking about e-commerce for years, so this shouldn’t come as a surprise to anyone. The truth is the next generation have caused retail to go over the tipping point. Older people like me use the Internet in a different way to younger people who have grown up with the Internet.
The thing that changed everything was the smartphone. Wherever I go, people have a smartphone in their hand. People are addicted to it, go on a train or bus, and people are looking down at their phones, even when they are walking down the road. Companies that are doing well are the companies that know how to exploit this technology.
The other thing that changed is the next generation not only live on their smartphones, but they also don't think twice about returning something if it's not right. Older people don’t like to send stuff back, younger people don’t have a problem sending stuff back.
I've got three teenage daughters, and there is a constant stream of parcels delivered to the house. I still prefer to go to town to spend my money, but my daughters are happy to use technology.
When the Internet first arrived, people used it just to surf the Internet, they didn’t use it to buy anything, now I am in a panic when I can’t feel my smartphone in my pocket, this tells me everything.
The tipping point has arrived and the companies that are doing well are the ones that know how to exploit technology, every time I pay for my pasty at Greggs using Apple Pay, I have a smile on my face, it’s absolutely fantastic.
As you are reading this, you’ve probably got in a smartphone in your pocket so don’t be the ones that said, “I told you so.”
#CuttheCr*p Lessons Part 2
By Chief Provocateur @Ajaz_Ahmed
A while back I wrote about my ‘Cut the Cr*p’ talks, the response was amazing, so here’s part two.
#GarlicBread Peter Kaye’s famous Garlic Bread sketch - “I’ve seen the future, I’ve tasted it, we’re all going to be eating 'Garlic Bread.' Am I hearing you right? Garlic bread? Bread with garlic on it? No, I don’t think so. No thank you.” While this is funny, this is the problem with people in business. When you come up with a good idea, the first thing your boss will say is “No” without even thinking about it, it’s happened to me many times. Don’t fall into ‘Garlic Bread syndrome.’
#ConfirmationBias Most people have a built-in bias and look for ways of confirming that bias. They look for ways of proving they're right and you're wrong, especially if you are low status ‘Colleague’.
#NoOneCaresAboutYou You can learn this the hard way, in business, no one gives a damn about you. For example, people are nice to you when they want something, but nobody will knock on the door to say, “We think you’ve done a great job, you deserve this bonus.” Life doesn’t work that way, get used to it.
#DontWalkAroundBlind We’re bombarded with stimulus from the minute we wake, to the minute we go to sleep. The Internet, TV ad’s, newspaper ad’s, billboards, shops, etc. We’re exposed to so much inspiration, so why do I see so many cr*p in business. People must be walking around blind, can’t they see how cr*p they are compared other successful businesses? Open your eyes and get inspired.
#NickIdeas I knick ideas all the time, I’ll see a colour here, a font there, navigation on a website, a way to describe something. My boring firm does well because I’ve applied retail principles to it, lessons I've learnt from lots of companies. Walk around with your eyes open, borrow ideas and use them in your business.
#DontListenToCustomers Becoming the customer, use empathy, I don't do market research or customer surveys. I’m not the only one, great businesses use empathy.
#ArseCovering Market research is for insecure middle managers who want to cover their arse in case something goes wrong. Learn to take risks and go with your gut.
#CustomersDontSayGoodbye In case you hadn’t noticed, customers don’t say goodbye, they just go. Don’t take your customers for granted, they might not be there tomorrow.
#GetToThePoint Learn to get to the point.
#DontIgnoreDisruptors Incumbents generally ignore disruptors, they think they are too small to affect them. The disruptor gets bigger and bigger, and then one day it’s too late. History has lots of examples of incumbents ignoring disruptors. Don’t ignore them because you might live to regret it.
#OutsideTheIndustry Disruptors generally come from outside your industry, and incumbents like to maintain the status quo and carry on doing the same thing today that they did yesterday.
#Goingout&Holiday At a certain point in life, people give up on their dreams and then they the only thing they look forward to is, going out on a Friday or Saturday night. They then spend six months talking about the holiday they're going on and the other six months talking about the holiday they went on. Don’t give up on your dreams.
#YourBiggestAsset For some reason people think that their house and car is their biggest asset, they spend time and money on them. Wake up, you're your biggest asset. Spend time and money on yourself and then buy a bigger house and car.
I hope you get the idea, encourage everyone in your company to #CutTheCr*p.
It's really simple.
This blog first published in Retail Week
Demand for your products will not fall. Instead, customers will start spending their money with newer retail firms, and ‘they won’t be phoning you to say goodbye.’
Most retailers have yet to board the new technology train. Customers buying patterns have started to change, and it is not a case of it might happen, it has already begun to happen. The critical question is, will your firm be on board the new train?
The problem is straightforward. Customers want to buy things that most firms won't be selling, and they want to buy it in a different way. New start-ups and new technology will sort out the problem, and in the future, that is where the money will go. As demand changes, old retailers will carry on selling the same old products in the same old way.
We can’t pretend that change isn’t going to happen, so we can’t carry on making well-crafted arguments for maintaining the status quo because no one person can delay the inevitable, it's going to happen whether we like it or not.
The choice is yours. Directors can carry on thinking about what wine to drink this weekend and where to go on holiday or reflect on the insolvency company they might have to appoint in the future. Don't forget that disruptors always come from outside an industry.
If you don’t change, you will not be able to respond to the future needs of customers. Rest assured that if you don't respond, the market is so large that someone else will take your customers.
The bigger question is when the disruptors arrive, and the incumbents ignore them, are you going to behave like the Luddites? If you are, then start reading your history books now and learn from the past.
A disruptor is a new, alternative source of supply that appeals to customers in ways that the existing supplier can’t. The disruptors appeal lies in its ability to provide unique value to the customer in a way or a manner that the incumbent providers have overlooked, ignored, or as often is the case, they believed to be impossible. A disruptor typically adopts new business models profoundly different from the incumbent, one designed for the customer needs.
The disruption theory is that alternative suppliers grow market share, starting from the edges of a market of its least complex and lowest-value needs, then they work their way up and into higher-value sectors.
Then at a certain point, the established supplier collapses, and the challenger becomes the new incumbent. There are many examples of this pattern from retail, Internet, mobile phones and many other industries.
You can’t afford to put off worrying about disruption for one moment longer, and it's not about the millions you are turning over today, it's about the rapid loss of turnover that you will experience once the disruptors arrive. Don't put it off any longer. Don’t carry on adjusting the window dressing when it’s the foundations that need some attention.
When I talk to retailers, they always start with a little laugh and then tell me why things can’t change and how it’s not in the customers best interest. Retailers it seems are glass half empty people.
In 2006 I told the MD of a large firm that they better get ready, Amazon is coming, the response was, “we’re not worried about Amazon, they don’t have a sustainable business model,” I’ve still got the email.
A retail MD’s favourite line is “Look, you just don’t understand,” yes, I do.
This blog was first published in Retail Week
Should the Government think about an ambitious plan to bring more BAME minorities, (BAME - Black, Asian, and Minority Ethnic, used to refer to members of non-white communities in the UK) into Britain's boardrooms.
The aim could be for one in five directors of FTSE 100 companies to be from a BAME background. Lord Davies' review into women in the boardroom, which began in 2011 and has had some success in increasing the numbers of women in senior business roles.
But is this a good thing? Do we need quotas?
My father's generation came to this country to work in the textile mills. Most were uneducated, but times have changed. We now don't think twice when we see a BAME doctor, surgeon, nurse, dentist, optician, pharmacist, lawyer or accountant. We read success stories of BAME business people and are sometimes surprised when we find out that the well-known brands we love are owned by BAME business people.
Someone recently came to see me at our office in Leeds, and it turned out he was Scottish, the first thing he said to me was "Did you know that your lift has a Scottish accent?" He was so pleased that he even tweeted about our lift having a Scottish accent. I would feel the same way if I met a BAME business person sitting on the board of a company, I would want to tweet about it to the world. That's the problem, we just don't have many BAME business people selected to sit on the boards of companies.
If we are to have more diversity on boards, to get our numbers up, quotas must be a good thing, right? No, I don't agree. Companies should not be forced to take people on just to meet a target, another box that's ticked. I wouldn't want to be selected just because a company needed to reach a target number.
Have we got a problem? Yes, we have. Boardrooms are just not representative of the world we now live in, and the customers their companies serve, they don't represent the people that spend money with them. Something needs to change, and we shouldn't be afraid to discuss it - it's a subject that will undoubtedly generate a lot of debates.
I looked at an online article about the Government's intention to change the rules, it attracted 294 comments. Some had to be removed because they broke the house rules, and many were racist in the way they talked about the subject.
Many people have strong views but only express them when they can hide behind made-up names on the comment bit on a website. I've also noticed that on some sites the most common name is 'Anonymous.' I didn't realise it was such a popular name.
So, if quotas are not the solution, what should we do? The CEOs of companies have got to be more aware of the world their companies live in. They need to recognise the mix of people that work for them. They can learn a lot from the public sector which is very good at employing people from all ethnic backgrounds.
Is change possible by itself? Can people change? Probably not.
One of the observations I've made in my time in business is that people are very good at making well-crafted arguments for why there shouldn't be any change. They are well-versed at explaining why you don't understand and why the status quo can't be changed. Most of the time I just listen and don't say anything, it's not worth the argument.
I honestly can't remember the last time I met a non-white person who sits on a board. That means there has to be a problem. We can't carry on with lots of Ethnic professionals in business, but very few sitting on the board.
That change must come from the businesses themselves because otherwise the Government will impose quotas, and that's wrong. It has the potential to breed resentment and bring only short-term tokenism rather than a long-term solution to this problem.
And if you're wondering, do I ever get asked to sit on the board of a private or listed company, no is the answer.
Has the tipping point arrived? For example, Freeserve launched in 1998, and the Internet boom started. For years people talked about e-commerce, but nothing happened. Smug people said, "I told you so," then a few years later than expected, Amazon finally arrived, and the e-commerce boom really started.
Then people said e-commerce will have a big effect on our high streets, but still, nothing happened. The same smug people said, "I told you so." Later than expected, things have now changed, and our high streets are a lot quieter than before.
So, the big question is, has the tipping finally arrived?
When the Internet first arrived, we only used it to surf the Internet, we didn’t buy or sell anything on the internet. Mobile phones were only used to make phone calls, we only took our phones out of our pockets when they rang.
Now I’m in a panic when I can’t feel my smartphone in my pocket. My smartphone tells me everything. Companies are only limited by their imagination, I have a smile on my face every time I pay for a pasty in Greggs using ApplePay, it’s absolutely fantastic.
It’s not just about the internet. All my life I’ve heard smart, intelligent people say the words "It’ll never happen." What won’t happen? Anything that a smart, a higher ranked person say’s won’t happen. Every day I read about things that are now happening, things that people previously thought would never happen.
Businesses don't "Pivot", they need to constantly keep changing. Lots of businesses only change after they have problems. Every day there are stories in the press about companies that are going through change because their customers have abandoned them. Don’t they understand? Customers don't say goodbye. They just leave.
Apple stores are still busy because they go through a pivot when customers are still spending money with them. Our Managing Directors don't understand this rule.
Guess what? Change is happening, and this is just the start. Managing Directors are still saying, “It’ll never happen, it’s not going to affect my business, we’ve been doing this for many years.”
The problem with a lot highly paid people is, every month, they’ve got lots of money left over after they’ve paid their bills and mortgage. They don’t understand that every month their customers have no money left over. They lack empathy, they can’t feel what their customers feel because they’re doing okay.
Why do Managing Directors not listen when someone offers them some free advice? Because they like to interpret facts to confirm the beliefs they already have. Confirmation bias is when we interpret information in a way that confirms the bias we already have.
They don’t want someone else telling them what to do. They only want to look at information that confirms what they already believe. They like to ignore or simply not be exposed to information or opinions that challenge what they already believe.
Even when they take the brave step off exposing themselves to an alternative point of view, it may still be confirmation bias, because they still want to confirm that the opposition is, indeed, wrong. They start an argument about why you are wrong.
Even as you are reading this, you may be coming up with reasons why I am wrong.
Does any off this sound familiar? So, don’t argue, start to listen before it's too late for your business.
This blog first appeared in Retail Week written by Ajaz Ahmed
I recently gave a talk to a group of business people, I reflected on recent frustrations and thought to myself, wouldn’t it be great if people just got to the point and “cut the crap’ so that’s what I spoke about.
I called the talk #cutthecr*p and it was well received, the theme was no-nonsense advice about what it takes to be successful. I’ve registered the Twitter handle @cutthecr*p and encourage everyone to follow it and leave advice and wisdom, I will retweet the best tweets.
I broke the talk down into a series of hashtags so people could share it with their followers. Space here is limited so here’s an abbreviated version, feel free to share and tweet.
What’s the difference between a businessperson and an entrepreneur? I believe entrepreneurs have greater power of #observation, they see things that trigger thoughts that lead onto great ideas. They also have a greater power of #empathy, they can put themselves into their customers shoes and do not rely on market research or customers surveys to back up their gut felling. Lastly they ‘believe it before they see it’ whereas businesspeople need to #seeittobelieveit.
#dotheobvious - life really is about doing the obvious before it becomes obvious to everyone else because by the time it becomes obvious to everyone else its too late because people like you have done it and the others guys haven’t. Simple.
#pivot – when things aren’t going well and your customers have moved on, you need to pivot and change direction. When companies don’t pivot, they start to blame everyone else for their own problems, they simply don’t change direction. Business doesn’t stand still, pivot and move on.
#pickabigfight – if you’re launching a new venture, think big and pick a big fight. Don’t restrict your ambition.
#vestedinterests – Sony should have invented to the iPod, they manufactured and owned the Walkman brand and own music content. I suspect when someone suggested it, different divisions didn’t see the big picture and came up with reasons why they shouldn’t do it. It took outsiders like Apple and Amazon to show the incumbents what to do. Vested interests often prevent businesses from doing the right thing.
#swimmingnaked – Warren Buffet said “It’s only when the tide goes out that you can see who was swimming naked”. Any idiot can take money in good times, since the recession started we’ve all seen who was swimming naked.
#whatwhyhow – when you visit a website you should be able to answer these simple questions. What do you do, why should I care and how do I do business with you. Think about it, how many times have you visited a website and thought, what do you do? So what, why should I care? How the hell do I do business with you? Look your own website now.
#expertsarefullofsh*t – just because someone calls themselves an expert doesn't mean they know what they are talking about. Experts designed all the poor things that you’ve ever seen. Don’t be embarrassed to ask experts stupid obvious questions.
#uglybabysyndrome – we’ve all seen parents with ugly babies, they love them because its their flesh and blood. It’s the same with ideas. People fall in love with their idea because they came up with it. The best thing to do if someone tells you their crap idea is just be honest and say “its crap”, pretend you’re Simon Cowell.
I hope you get the idea, so #encourage everyone in your company to get to the point and #cutthecr*p.
This blog first appeared in Retail Week written by Ajaz Ahmed
We’re exposed to a mountain of visual stimuli everyday. The power of observation is a great gift and I love walking around shops, it gives me great inspiration. I love looking at how great retailers practise their art and I learn something new every time a walk around a shop. It’s the details that make the biggest difference, the lighting, the colours, the fonts, the visual merchandising and great design.
I love walking around Hollister even though I’m never going to buy anything. I’ve noticed that they have the best sound system in the high street, does that make a difference? Yes, I don’t feel like leaving. I love the copywriting that stores like IKEA and Pret use to entice their customers. I was in heaven when recently visited a Whole Foods supermarket in the US. I felt like buying things that I didn’t even need - what a truly clever retailer.
I love looking at newspaper adverts, it’s amazing how advertisers manage to grab your attention when they only have a few seconds to do it in. I love looking at websites to try and figure out how companies like Amazon make the experience of visiting their site so much better than their competitors. I love reading books and magazines to learn how people and companies achieve their success.
If there is so much to learn from other successful companies, why don’t more people learn by observing? Do they walk around their World blind?
I’ve visited some appalling companies in my time and I could cry when I see them making simple basic mistakes. If I asked the senior managers of these companies “how’s business?” they’d probably say it’s a struggle and list all the reasons why, but they’d never admit it’s their fault.
I’ve always wanted to ask senior managers at WH Smith, “what do you see every time you walk around your stores?” I think it’s a visual mess and other than fixed price products, everything you sell is available cheaper within walking distance of most stores. If they stood and watched the people walking into their stores at lunchtime they would observe that people buy food and drink somewhere else and newspapers and magazines from them.
It’s the same at Argos, it not a great in-store experience and did they real need to hire expensive consultants to advise them that the future for them is the Internet?
Why do struggling retailers not learn by comparing themselves to other successful retailers? When they go shopping don’t they ever ask themselves, “Why do I shop here? Why do I look forward to coming here?”
We have some fantastic retailers but we also have a lot of awful retailers, it doesn't matter what sector your business is in, there’s a lot to learn from good retailers.
The solutions to most of your problems are all around you. Simply open your eyes and take a good look around, don’t walk around your business with your eyes shut.
Go shopping and don’t buy anything, just look and take it all in, be inquisitive, be curious. You’ll be amazed at what you’ll see.
This blog first appeared in Retail Week written by Ajaz Ahmed
Why are so many retailers struggling and going out of business at the moment? Because before the recession it was easy to take money, easy credit drove the market and a good time was to be had by all, but as the quote says when the tide goes out, only then do you find out who was swimming naked.
This industry is full of people who simply are not retailers, it’s as simple as that. It’s full of people that have never worked in a shop and could never work in a shop, they simply don’t understand customers and its customers not spreadsheets that drive a retail business.
What’s the difference between a businessperson and an entrepreneur? The two biggest skills that an entrepreneur possesses is the power of observation and empathy. The ability to put yourself in the customers shoes is priceless, that’s how great retailers are able to become such a success without any formal qualifications.
Freeserve was born out observation and empathy. I’ve worked in retail (Dixons/PC World) for many years and one of my observations is that when senior management visited my store, they would very rarely talk to the staff. They would never take time to ask the people who spend all their time on the front line shop floor “what do you think? How can we improve things? What are our customers asking for?” The solutions to many problems often lie with the staff if only someone would ask them.
Comet has struggled, so how much change has been made to the retail part of the business since OpCaptia took over? Not a lot. Here’s an interesting fact that the guys sitting behind their desks at head office and the private equity guys might not understand, it’s the retail part that customers see, not the cost cutting or the operations, they see the shops. Customers walk into the shops and spend money.
A number of my friends work at Comet and I would often ask them “what would you change?” They came up with all sorts of common sense ideas that would make huge difference to Comets business. But did anybody ever ask them? No. I asked my friend who is a store manger, when the chairman, John Clare came to visit your store, did he talk to any of the staff or any customers? No was the answer.
That’s why Comet is going bust, because none of the Private Equity guys or Senior Management of Comet are retailers with observation and empathy skills. They are too arrogant to bring themselves to believe that someone on the shop floor might be able to make a suggestion that could make a valuable difference. Because people at head office never went into the stores and asked the staff what they they thought, they look down on the staff that work on the shop floor.
Retail greats like Sam Walton and Ingvar Kamprad walked the shop floor and talked to their staff and customers. You can’t run a shop from just spreadsheets sat behind a desk.
British retail needs more retailers.
This blog first published in Retail Week
One of the first big Internet companies was Freeserve, it launched in 1998 and the Internet boom started. For years people talked about e-commerce, but nothing happened. Smug people said "I told you so," a few years later than expected, companies like Amazon finally came onto the scene and then the e-commerce boom started.
Then people said e-commerce would have a big effect on the high street but nothing really happened, and the same smug people said: "I told you so." Things have now changed so the big question now is, has the tipping finally arrived?
This year, Retail Week has been busy with lots of stories, and the truth is the next generation has caused a lot of this. Older people like me use the Internet in one way, but younger people have grown up with the Internet and use it in a different way.
The thing that's changed everything is the smartphone. Wherever I go, people have got a smartphone in their hand. People are addicted to it, go on a train or bus and people are looking down at their phones. When I look at my family at home, young and old, they are looking their phones, it's seems part of their lives. Companies that are doing well are the companies that know how to exploit this technology.
The other thing that's changed is the next generation not only live on this technology, they don't think twice about using it to buy something and but they don’t think twice to return something if it's not right. Older people don’t like to send stuff back, younger people don’t have a problem sending stuff back.
I've got three teenage daughters, and there is a constant stream of parcels to the house. I still prefer to go to town to spend my money, but my daughters are happy to use the technology and importantly also return things if they are not right.
When the Internet first arrived, people used it just to surf the Internet, they didn’t use it buy anything. The technology to buy anything wasn’t there. When mobile phones first came out we only used them to make phone calls, the technology to anything else wasn’t there. Remember we only took them out of pockets when the phone rang?
Now I am in a panic when I can’t feel my smartphone in my pocket. It tells me everything. Retailers are only limited by their imagination, every time I pay for my pasty at Greggs using ApplePay, I have a smile on my face, it’s absolutely fantastic.
I am in no doubt the tipping point has now arrived and the companies that are doing well are the ones that know how to exploit the technology. As you read this, don’t forgot what you’ve got in your pocket and which companies are worth a fortune. Don’t be the ones that said “I told you so.”
I recently watched a US episode of TV’s “Undercover Boss”, and in it, the boss of a large car manufacturer was shocked by what he found. I was more shocked that an intelligent, highly paid boss had never mystery shopped or engaged with his staff before. It was the same when I watched the UK version this week with the CEO of Moss Bros going undercover.
Believe me when I tell you that buying a car is a truly soul-destroying experience. If that is the case, I must conclude that senior executives in the auto industry have never actually tried to buy a car. They are given company cars, so they bypass the whole showroom experience.
What’s wrong with a car showroom? Everything. Every time I go to a car showroom, I’m amazed at how little these guys know about the basics of retailing. I end up walking around imagining all the changes I would make by using simple retail principles that would increase sales. How? By just using empathy and imagine that I am the customer, it's not rocket science.
But it's not just the car industry that makes it difficult for customers to do business with them, lots of retailers and retailers websites could also make it a lot easier for customers to do business with them.
The big question you need to ask yourself is “do I employ people whose job is to make it as difficult as possible for a customer to do business with me?” A “Sales Prevention Department.”
I’m convinced that in some companies the sales prevention department is, in fact, the biggest and most influential department.
Why does it take a TV program for the chief executives to engage with staff and customers?
Why do companies employ mystery-shopping companies? Why not ask staff in your head office to go and visit your stores unannounced. Get them to observe what your customers feel. Get the people that sit behind a desk sending out emails to go out onto the shop floor of your business and your competitors and talk to staff and customers.
I worked in retail for 17 years and had plenty of planned visits from directors, we used to call them “Royal Visits,” and in all that time, I never once saw any of those directors talk to a customer and I never had anybody turn up unannounced just for a chat.
This is basic, basic stuff. This is what entrepreneurs do - they talk to their customers and staff.
My advice to retail bosses is, don’t complain about poor sales, get out there and improve your customer experience. Don’t use market research and surveys; they are for insecure middle managers.
Get out onto the shop floor and ask people about their experiences. I warn you, if you’re easily offended, don’t do it, stay behind your desk.
And finally, disband your sales prevention department now, then watch your business improve.
Ajaz Ahmed founder, Freeserve and Legal365.com
Demand for legal services in the future will not fall. Instead, customers will start spending their money with newer law firms and the cause of this change in legal spending will be new technology that will reduce the value of transactions.
Most law firms have yet to board the new technology train. Customers buying patterns have already slowly started to change, and it is not a case of it might happen, it has already begun to happen. The important question is, will your firm be on board the train?
The problem with the legal industry is very simple. Customers will want to buy things that most law firms won't be selling. The majority of lawyers only sell one thing, 'time by the hour' and customers in the future won't be interested in buying that, they want fixed priced solutions. Start-ups and technology will sort out the problem, and in the future, that is where the money will go.
As demand changes, old law firms will carry on selling the same old solutions with arguments as to why customers are wrong.
Law firms need to look at acquiring start-ups and operating under different brands and new business models. They need to start thinking differently and diversifying. If your law firms doesn't change, you will not be able to respond to the future needs of customers. Rest assured that if you don't respond, the legal market is so large that someone else will take your customers.
The choice is yours. Partners can carry on thinking about what wine to drink this weekend and where to go holiday or reflect on the insolvency company they might have to appoint in the future. Don't forget that disruptors always come from outside the industry. I'm a retailer, and I'm only interested in one thing, the customer.
The solicitor's favourite line is “Look, you just don’t understand” and presumably you'll charge me by the hour to explain why I don't understand.
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