Big interview: John Lewis retail operations director Simon Russell

Innovation is the buzzword on all the big retailers' to-do lists right now, and some are dedicating more resources to making it happen than others.

Leading UK grocer Tesco holds regular hackathon events, where it looks to uncover new systems that might take the business forward, while Home Retail Group's Argos has recently set up an innovation hub in London Victoria to stimulate new ideas and methods of working that meet the requirements of the new mobile, tech-savvy consumer.

If you ask 100 retail professionals for a good example of modern retailing that embraces technology and meets customer demands across a number of platforms, however, the chances are that many will mention department store chain John Lewis, which has grown sales significantly in recent years and won a long list of industry awards after embracing technology and investing time in improving the customer experience.

Simon Russell, director of retail operations development at John Lewis, told Essential Retail that retailers' current dedication to technology and innovation comes at a time when "true end-to-end omnichannel customer experience is absolutely key" for companies operating in today's market – a key theme Russell focused on during his packed-out presentation at this year's RBTE in London.

He explained: "The whole customer journey is a lot more complicated than it was ten years ago, and one of the things that knits it all together is technology. It brings it all alive and the bar that customers set is higher than it was before.

"It is an area that I think retailers are competing in, to focus on this customer experience to make sure they give the customer an optimum experience all the way through. Given technology is a solution to unlock it, that's one of the key reasons that a lot of retailers are very interested."

JLAB – all systems go

It was against this backdrop of innovative thinking that John Lewis announced in March that it was to launch JLAB, a technology incubator scheme involving investors from a range of backgrounds, such as founder Sara Murray and private equity guru Luke Johnson, who will work with start-up firms to develop pertinent tech solutions for today's retail market.

Following a pitch day last week (see image below), five small tech firms have been chosen to work alongside John Lewis and the investors at a special hub in London's Canary Wharf, where they will develop their concepts and, ultimately, battle to win £100,000 worth of investment to grow their business.

The five companies picked to be part of this year's JLAB include in-store digital engagement firms Localz and Viewsy, as well as wireless sound system Musaic, augmented reality app company SpaceDesigned and smart-label aftersales service Tap2Connect.

Talking about last week's pitch process, Russell said: "I was particularly interested in looking through the customers' eyes and thinking 'what will this actually feel like and how will it enhance the customer experience?'.

"If customers enjoy it more, they'll spend more money and we'll get more profit out of it. It's an exciting phase we are going into. I really hope [the JLAB winner will form] a true partnership."

Describing the benefits of JLAB for all parties, he said that the tech companies are keen to find out what retailers' priorities are, while John Lewis will potentially be able "get on the front foot" and gain a lead in some of the new developing areas of retail technology.

"We're really keen that we will be able to influence some of the solutions, offer them the opportunity to trial some of the solutions in our shops, and who knows we may be able to roll out the successful company and their product if it were accessible at the end of the process," Russell explained.

The JLAB winner, which will be announced after a 12-week programme beginning 9 June, may also look to market its tech concept to the wider retail world in time, and that's where investors' interest in the scheme may lay.

Recruiting innovation

Another common theme among the large UK retailers focusing their attention on business advancement and uncovering new technologies is the deployment of innovation managers to aid the strategic decision-making process.

Tesco has Nick Lansley as head of open innovation and Paul Wilkinson working on IT research and development, while Argos recently recruited Lucy Butler as special projects manager to help bring to life the retailer's strategic vision to become a digital retail leader.

At John Lewis, John Vary was employed in January 2014 as innovation manager to bring a new way of thinking across the company's various departments, and is described by Russell as a "fantastic" addition to the team.

Giving an insight into what these new innovation-focused staff can bring to a retailer, Russell explained: "Having worked much more closely with John he is incredibly creative and I think finds a much more efficient way – and perhaps a cheaper and faster way – to get to a solution that solves the problem than we have historically been able to do.

"He's very much focused on what's out and about in UK retailing and worldwide. There's a big focus on that, while with a traditional IT person there's perhaps more of a focus on systemic solutions. He's a great interface between the business and the IT teams, and it brings us a level of creativity that allows us to solve problems we weren't able to do before."

Vary was one of the panellists to sit alongside Russell and members of the John Lewis board, as well as the aforementioned business leaders, when judging the JLAB contenders. With the five chosen companies all now in place and soon to start their 12 competitive weeks in Canary Wharf, it is hoped the incubator may stimulate some cutting-edge concepts and bring a fresh wave of thinking into the John Lewis business.

But while the JLAB winner may well be part of the department store group's future, for now the immediate focus for the company is on new store formats and continuing to improve the multichannel journey for customers.

John Lewis's first airport store opens with the unveiling of Heathrow's Terminal 2 in the first week of June, and the company will introduce its inaugural train station outlet later this year when it arrives at St Pancras in London.

Commenting on the first airport shop, Russell said: "As our international web presence grows, it'll be interesting to see how some of our European customers who will be flying in and out of Heathrow build a closer relationship with the brand – we'll learn a lot from it."

On the station store at St Pancras, he added: "Speed will be something we have to be really good at – we're mindful of that – but there'll be learnings we make from that which we can bring into the rest of the estate."

This willingness to experiment with new things, as well as the time and investment put into developing innovative ideas and customer-facing technologies, are arguably reasons for John Lewis's current high standing in the retail industry. But there is no sign of the business letting up in the near future and there is still plenty of work to be done before true omnichannel retailing has been achieved, according to Russell.

"It's very flattering to have all this praise, but we're certainly not complacent," he argued.

"My to-do list is probably as long as anyone's in retail in terms of things we know we can improve."