Big Interview: Ed Armitage, eCommerce director at Waterstones

"As a bookseller, you can't replicate the experience of a personal recommendation received in a shop," argues Ed Armitage, eCommerce director at Waterstones. "It's about recommending the right books to the right people."

But the bookseller, which appeared on the UK high street in the early '80s, is looking at digital ways to replicate this in-store experience online.

Armitage explains that while online booksellers are powered by customer data – making recommendations based on what other shoppers have viewed or bought – Waterstones is incorporating additional datasets using knowledge from store employees. Working with SmartFocus, the retailer is able to incorporate this human knowledge into its online recommendation dataset.

"Our recommendations will also straddle different genres, or suggest a book published 20 years ago – there are connections you can make between different products if you use the bookseller knowledge, so we're working on a platform to lay that on top of the customer data to provide some pretty interesting recommendations, but it's all in testing at the moment."

The retailer's loyalty card programme has been running for the last six years and is another way of gathering customer information. 

"We hold a tremendous amount of data about our customers," he says. "And most are loyal customers who purchase all of their books from Waterstones, and we can learn additional details including location, whether they also bought non-book products, and this gives us an immediate window into the customer."

Armitage says Waterstones can learn a lot from people's read habits. For instance, whether the customer likes serious hardbacks at Christmas and fiction for the beach in the summer.

But like many other retailers, Waterstones has found it difficult to query the data attained from customers. "We've never really had a tool to quickly and intuitively dive into that data and go into their buying habits."

The retailer has just embarked on a partnership with SmartFocus to rectify this, integrating its wide suite of products including CRM, email marketing and personalisation technologies. Armitage worked with the vendor during his previous digital role at Hobby Craft and says the products "open the world up" to personalising the customer's online experience.

"There are only a few vendors I rave about and SmartFocus is one of them," he says. "We signed up less than three months ago and we're 80% of the way through the integration."

Email marketing

Armitage says SmartFocus' CRM product – SmartInsights – is particularly useful when targeting emails. "It may not be pure personalisation, but if we have a serious fiction book launching, rather than sending it to two million subscribers, we will be able to send it to 30,000 which we know are going to be interested – being able to segment based on people's reading habits is absolutely essential."

Armitage says the retailer is able to tailor the site based on loyalty card history for logged in customers, as well as personalising based on a customer's IP address or cookies. 

"You can absolutely personalise for users who are not logged in," he explains. "Rather than tailoring the experience to people's purchase history, you can still upsell and cross sell products based on location, browsing behaviour and a host of other factors."

"Each method of recognising the customer allows us to personalise using additional data sets and more complex algorithms."

Personalising the homepage

Waterstones is also looking at ways to personalise its homepage for different customers, after experimenting with Qubit. For instance, using the customer's IP address, Waterstones can deliver information about a customer's local store rather than presenting them with a generic bookshop online banner .

"Because we know where you are, we can personalise location-based content easily," he says, explaining how Waterstones can advertise one of its hundreds of book signings which occur up and down the country to a customer in a specific location.

"If you log on from Manchester, you'll see the Manchester shop on the homepage, and if we know you like reading fiction, we’ll tell you about a fiction book signing in Manchester, rather than the generic events' banner," he explains.

The Amazon effect

And despite Amazon's ever growing presence in the eCommerce landscape, Armitage says Waterstones does not consider the e-tail giant a direct competitor." Amazon's USP is the cheapest book delivered next day for free, we're not Amazon and we're not trying to compete on that level."

Armitage says high street retailers have to pick their battles, and that isn't on fulfilment or price, but accurate real-time visibility of stock so customers can access five million titles via the website and click & collect from store.

"We won't be the cheapest, but we will recommend a great book for you to read. And while we don't have the infrastructure for free next day delivery, you can pick it up from 300-odd bookshops within a few hours," he explains, saying the retailer has seen a healthy in-store upsell attachment with click & collect orders.

"Click & collect is a big win for us," he says. "We know where we stand, what our USPs are, and what is our value, and that's leveraging our store estate which is something Amazon doesn’t have.

"Despite being an old bookshop, we're lean and we love to try new things and make them work," he adds.


The next step for Waterstones is to focus on their mobile customers. Armitage says while the bookseller has seen an increase in mobile users in recent years, it hasn't been on the same level as other retailers.

"I don't know whether that's because our customers are an older demographic," he muses. "But until a year ago, mobile hasn't been a huge focus.

"Joining up the online and bookshop experience with the mobile phone is a key piece of the puzzle, and for us that means digitising our loyalty scheme. We have a responsive website, but you still have to carry a plastic card in your wallet."

Technology battleground

Armitage says he sees the retail industry as one of the most interesting technology battlegrounds.

"I admire all the pureplayers across various industries, like travel and financial services, with their skinny margins and focus on data and user experience," he says. "In multichannel retail you inherit a pretty old-school mentality. I look at the EasyJets, GoCompares and SkyScanners with jealousy.

"I've found with every multichannel retailer you have to come in and educate people about the benefits of using data and really fight for it."

And if Waterstones manages to perfect online personalisation and keep the customer at the front of its mind, the retailer should still be fighting for many years to come.

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