Big Interview: Brian McBride on digital disruption

Traditional retailers are under great pressure from newer digitally progressive competitors and need to figure out their place in this new environment if they are to survive and grasp the opportunities available.

Speaking ahead of his presentation at RBTE 2018, Brian McBride, chairman of Asos and Wiggle, says: “Digital brings disruption but also massive opportunities for those who figure it out. The message is that it’s fast-changing and they need to adapt to a different pace of life.”

McBride is well placed to cast an opinion as he was the managing director of Amazon in its early years in the UK and he says it was a “major transformer that people still look at and it casts a huge shadow over retail and all sectors”. And moving on from there he has latterly taken on the roles of chairman at both Asos and Wiggle.

But he does not believe that Amazon sounds the death knell for traditional retailers: “Yes, it’s had a major impact but people can over-worry. It will not have 100% market share in all segments. It’s about how retailers cope with it and not tackling it head-on. They need to work out how to leverage the beast – using its platform and its cloud (AWS).” 

“Digital brings disruption but also massive opportunities for those who figure it out. The message is that it’s fast-changing and they need to adapt to a different pace of life.”

Chapter one of the transformation journey

For far too many retailers he believes they have simply set up a transactional website and then “breathed a huge sigh of relief”. But they have misunderstood that this is just chapter one and that the pace of technological developments in the sector are in fact picking up.

He cites two major developments as having major repercussions: the use of mobile and social media, and the mass of data that retailers now have at their disposal. The challenge with the latter is being able to leverage the insight from this information.

“There are billions of rows of data and it’s about the ability to leverage it. Using artificial intelligence and machine learning is the only way to use the data,” he says, adding that this is the only way the likes of Asos can find the patterns in the data.

Hiring the right people

To undertake this complex analysis it is essential for established retailers to bring in the relevant people: “They have the opportunity to hire smart, digitally literate people [just like any other company].”

With people today having grown up with technology, and mobile and eCommerce not just being for young people, he says “there are no excuses for retailers” in failing to recognise the need to adapt their businesses and recruit accordingly.

Reinventing store models

There has to also be an understanding that store closures are inevitable - and that it is not because of the economy – but is down to the market moving on. “It’s an inexorable shift. The high street will not disappear but the 15-20% of retail that is now online could double over the next five years,” predicts McBride.

He acknowledges that there are many newcomers in the retail sector re-inventing the models and that this represents a significant challenge for traditional retailers but “the people in the industry are not stupid” and so there are opportunities for those that embrace the changes.

Driving this change has to be the customer, according to McBride, who cites Jeff Bezos [founder of Amazon] as building his business around the needs of the customer by listening to them: “It’s all about thinking of the customer.”