In this world of never-ending retail negativity it’s a real pleasure to see a set of results from a retailer that is not just surviving, but thriving. Is Selfridges the best department store in the world? I certainly don’t know of one that even comes very close. The more important point is that there are a number of important lessons here.
The first is about generic judgements. We all know about HoF, and Debenhams is very close to the edge. John Lewis has reported massively diminished profits. Each of these businesses is different and sector-wide judgements are very likely to lead to poor decisions. It’s not what you do (ie being a department store) but it’s how you do it. What we are seeing is the death of mediocre retailing.
Why is Selfridges so successful? Every winning retailer has one core thing in common – customer focus. Many say they are customer centric, but very few actually are. That’s why they are on sale most of the time. Why they are cutting jobs and it’s why their revenues are static and their profits are falling. Selfridges has a programme of constant refreshment – every couple of weeks there is a new department, a new event, a new brand or two, a new service or two. This dynamism helps to make Selfridges special – there is a vast chasm between talking about experiential shopping and actually delivering it. This is retail innovation – constant newness. And the excitement crossing the threshold is palpable.
The retail lessons of Selfridges are about great retailing through true customer focus, and constant change and improvement. There are also lessons for landlords. Selfridges is a very carefully assembled collection of brands where the sum of the parts is greater than its separate values. This is what truly pro-active management looks like. In the future, landlords need to think and act much more like retailers.
Selfridges thrives because it hits the spot with its target market. No one can match what it delivers. And neither can any offer online. This is about differentiation. The gaps between the retail winners and also rans are widening. It’s all about execution – the way you do it, and Selfridges continues to do it brilliantly.
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