Retail Day
Retail Week, today
Out with the old, in with the Newton-Jones
A very enjoyable evening last night at a dinner hosted by Shop Direct Group at Soho House. Shop Direct is of course the company a lot of people still call Littlewoods, but the Barclay Brothers-owned business has been moving at breakneck speed to transform itself from the dowdy catalogue and store business of old to a company where, at Christmas, 65% of its orders were being received online.
That transformation is being driven through by energetic Brummie Mark Newton-Jones, and inevitably is not without pain. Last week the company announced 1,500 job cuts in its call centres, a sad but inevitable function of people now ordering less by phone and more online. And it’s important to point out that the results of the changes still need to feed through into profitability.
Nevertheless, the business would be in a much worse state were it not going through these changes and bold moves like buying the Woolworths brand and renaming Littlewoods Direct as Very are the sort of things the company needs to do to ensure it remains relevant to a new generation of customers.
Shop Direct is keen to be seen as a leader in the online sphere, hence the dinner where there were talksfrom Google’s very engaging UK boss Matt Brittin, who I was fortunate enough to be sat next to, and a very unassuming chap called Liam Wood, who runs an online business called Enviro Lights, selling eco-friendly lightbulbs, having successfully launched a business selling hoover bags with his brother which now turns over £1m a year.
His tale was instructive. He worked in Morrisons while his brother ran a small shop selling vacuum cleaner bags in Derby. But the cost of rent and rates, combined with the threat to his footfall posed by the city’s new Westfield centre, meant his brother realised online was a better place to be and where he could develop a much broader reach for his brand, which he has successfully done through his site dustbag.co.uk
Now the brothers are aiming to launch a new site every year, with the lighting site already managing £200k in sales. These very modest entrepreneurs are a great example of the opportunities the web opens up to people who’ve spotted a niche in the market to reach many more customers than one shop ever could.
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