Interview: Retail in the iPad age
John Lewis IT chief Paul Coby tells Stuart Sumner how the tablet phenomenon is impacting customer service and online sales at the retail giant
John Lewis IT chief Paul Coby tells Stuart Sumner how the tablet phenomenon is impacting customer service and online sales at the retail giant
This is going to be a busy year for retailer John Lewis. In common with many UK companies, it hopes to boost business on the back of the Olympics, which will bring millions of additional people into the country this summer.
John Lewis is the official department store of London 2012. Its Oxford Street and Stratford sites will be key outlets for Olympic merchandise.
But Paul Coby, CIO at John Lewis, explains that there are risks along with the opportunities. The Stratford store is right next to the Olympic Park, and travel disruption is expected during the event.
"Life will be very different and exciting for our Stratford store, which will be an iconic store for the Olympics."
Coby says that he is making business contingency plans for the expected disruption to make sure that staff have the ability to work remotely. He is less concerned about staff at the firm's datacentres, however, which are not in central London.
Consumerisation
This is also a year in which consumerisation is taking hold at John Lewis. Coby has overseen a project to enable the use of staff-owned tablet devices among senior management and is looking to offer apps for employees to use in the course of their jobs.
He told Computing that cost savings are a key reason behind the decision to follow the consumerisation trend of allowing staff to use their own devices for work.
"This year is going to be challenging in terms of budgets, and spending money on fancy devices for management staff is not the right thing to do.
"Given that a lot of people have iPads, and they were absolutely flying off our shelves over Christmas, it's an opportunity to test a bring-your-own policy - with appropriate security measures."
The firm is also running pilot tests early this year, rolling out Cisco's Cius tablets to customer-facing staff.
"We're looking to test Cisco Cius tablets, allowing retail staff easier access to stock information. They'll also be able to go to the website to show customers products that aren't on the shelves."
He is mindful, however, of the security risks in enabling remote devices, as they can easily be lost, or fall into the wrong hands.
"You need to be extremely careful as you're dealing with customer data [on mobile devices], so it has to be absolutely secure. And if you're dealing with payments remotely, you need to ensure PCI compliance."
He is also a fan of Apple's iPhone 4S, and especially its Siri app, which allows much of the phone's functionality to be controlled by its owner's voice, although there are currently no plans to deploy this around the business.
"You should ask it what the meaning of life is," he says. "The answer changes. My favourite is, ‘Most authorities believe it's chocolate'."
An enterprise app store
In tandem with enabling remote devices, Coby is looking at creating a John Lewis app store where staff can download apps to help them in their work.
"We are looking at developing some apps for our partners [staff], that is the people who work here and own the business. That will have to be over John Lewis-provided kit, because if it's going to enable them to serve customers and take payment, it has to be absolutely secure."
But he explains that this will come after the development of apps aimed at John Lewis customers.
"About a fifth of our online orders come from tablets, which going by our sales figures are probably iPads. These days, it's vital to consider how we can interact with our customers in the way that they want.
"At the same time our partners expect to have the modern tools to do their jobs. So yes, it's something we're thinking about, but we'll develop the customer-facing apps first, then apps for our partners later."
On the customer-facing side, John Lewis released an iPhone app before Christmas, which Coby says has proved successful in terms of the volume of downloads.
Interview: Retail in the iPad age
John Lewis IT chief Paul Coby tells Stuart Sumner how the tablet phenomenon is impacting customer service and online sales at the retail giant
It enables customers to scan a QR code on a product in one of the firm’s stores, and this allows the customer to see more information about the product, including videos and reviews from other customers.
This functionality works in tandem with the free Wi-Fi networks, supplied by BT OpenZone, which John Lewis rolled out to all its stores last year. Customers can access the service after subscribing first online. Coby describes the end result as “joining up” the online and offline channels.
“We are what people call a multi-channel business. At home customers can place orders with a laptop or iPad, or an iPhone or Android device while they’re travelling, for example. But if you’re buying a bed, you still want to go and look at it, or test it out. Or you might want to talk to someone in a call-centre or at a store.
“The opportunity to talk to a really informed partner who’s passionate about what they’re selling and understands it, and is not on a commission, is a great thing.”
More than one channel can be part of the same transaction, Coby says, pointing to his firm’s new “click and collect” service, where a customer buys online then collects at a store. Coby says that this service has proved popular since its launch. He believes that this multi-layered model represents the future of retail.
“Retailers must be able to provide the information and products that you want in any channel you want. It’s about providing the John Lewis experience via any channel. My challenge is to join up the systems that sit behind all this,” he says.
From one UK icon to another
Before joining John Lewis in 2011, Coby was CIO at another iconic UK organisation, British Airways (BA). The big difference in his new role, he says, is the speed at which retail operates.
“Retail is extraordinarily fast moving and competitive, and the time horizons are very short. At 10 o’clock every Monday morning we go through the last week’s performance across every store and online.
“It takes us just half an hour. You absolutely need to be on top of how fast the business is moving.”
Then every evening at 12:20am, the previous day’s sales come through on email, sorted by category and store. Coby says he’s often awake and can’t resist scrolling through to check how the online store is performing, though he admits this isn’t necessarily a healthy obsession. “Actually, you can become a data junkie if you’re not very careful.”
John Lewis saw exceptionally strong online sales over Christmas, much of which happened because the clearance sale was launched on Christmas Eve.
“We decided to go live at 5pm on Christmas Eve, with 210,000 products discounted. We actually turned it on at 4:50pm, and you should have seen the servers. Traffic shot up immediately.”
Coby says that the online store sold about two million items in the first three hours. He sent Andy Street, John Lewis’ managing director, a photo of the hectic control room at the moment the sale went live. “He sent a message back saying, ‘This is a lot more exciting than boring old airlines, isn’t it!’.”
Coby says his time at BA has been invaluable in helping to steer John Lewis’s e-commerce strategy, as airlines were quicker to embrace online sales than retail.
“The nature of the airline business – selling a permission to fly online, or vouchers to stay in hotels – is virtual until you consume it. So the online switch for the business was rapid,” he says.
Now the switch to online sales is accelerating in retail, says Coby.
Over Christmas, about a quarter of all John Lewis products sold were sold online. According to Coby, the UK is among the world’s leaders in terms of online retail, pointing out that John Lewis’s counterparts in the US only shift 10-15 per cent of total sales online.
He puts this down to the relatively sophisticated UK consumer, coupled with good public IT infrastructure and high social media penetration, where so much online marketing happens.
“This means that the pressures are intense. If you’re leading in multi-channel retailing and the technology to support it in the UK, you’re probably leading the world.
“When some of our staff went over to take a look at what US stores were doing, we saw that they’ve got some good ideas, but they’re not leading us at all.”