Big Interview: Matalan on recruiting digital talent

When you think of Matalan, your mind conjures up the image of a big-box store, perhaps on the edges of a bustling town, or a high street large enough to accommodate its extended range of home and fashion lines. It’s safe to say the retailer has been firmly in the bricks & mortar territory since its creation in the ‘80s. And this approach has served it well, with the value retailer becoming a breath of fresh air against this year’s predications of an imminent death of the traditional British high street.

Following its most recent financial year, ending February 24 2018, Matalan reported pre-tax profits almost doubling to £20 million, while revenue increased 2.5% to £1.06 billion. Since then it has continued to trade well with its Q2 2018, ending in August, reporting a solid performance.

But increasingly Matalan is offering more options to its consumers, and launching its first small-format shop on Oxford Street two years ago presented an opportunity to refine its fashion edit within the walls of its mere 16,000 sq ft store, while last month a similar sized store opened in Belfast.

As well as making Matalan more visible on the high street, the retailer has been upping its game when it comes to online.

Playing catch up

eCommerce director Paul Hornby is the first to admit that Matalan has some work to do to catch up in the online race.

“It’s probably fair to say we were quite slow to the game when it came to online, that has changed over the past couple of years and we have a really fast-growing online business,” he tells Essential Retail on a trip to Matalan’s headquarters in Knowsley last week, the rush of Black Friday still lingering in the air.

Hornby only joined Matalan nine months ago, from 12 years down the road at Shop Direct which he helped to transform from a catalogue retailer to a strong eCommerce player underpinned by a powerhouse of technology talent. Key to his new role at Matalan is changing the industry’s perception of the retailer from its bricks & mortar heritage, to a successful omnichannel player.

“Matalan is still perceived as a successful retailer because we are very much bucking the trend at the moment and we are generating revenue. But the success of the business historically has been on the store part, but what we’ve done over the last couple of months is continuing to accelerate the growth of online.”

Just before he arrived, Matalan underwent a replatforming of its eCommerce website, which Hornby calls a “big watershed moment” for the online business, which now A/B tests all of its eCommerce developments. One such development has been the improvement of online product recommendations as a way to inspire the eCommerce customer while they are shopping.

Next on the never-ending list for the eCommerce team is working out how to replicate the display of discretionary items which are traditionally merchandised at the checkout in a physical store.

“As the customer comes to the online checkout, how can we encourage them to add items of low consideration without returning to the shopping journey? We want to add a little sprinkle of pixie dust on that basket.”

The new UX Lab at Matalan HQ

The cheerful character has certainly settled into his new role leading a team of 30 at the newly built Matalan HQ. At the entrance to the eCommerce floor, Hornby’s desk – adorned with bunting spelling out ‘P-A-U-L’ – oversees his team who are busy developing the website in the open plan office environment. Off the side of this floor is the retailer’s new UX Lab where we sit down after a tour of the new facility that Hornby was integral in getting up and running.

The UX Lab has been built specifically to analyse customer behaviour online. Officially launching in early November with a new UX research manager spearheading the programme, the retailer plans to invite customers into its head office to watch them interact with the website and help it identify painpoints and bugs that need to be improved or fixed by the eCommerce team.

Split into two rooms, the Lab has one area stylishly designed, complete with a comfortable three-piece suite, bookcase, TV, coffee table and a large mirror hanging on the wall. It is through this one-way mirror that the eCommerce team can watch customers use the website, aided with video screens, while the walls in this adjacent room feature whiteboards ready for furious note taking and the applying of brightly coloured post-it notes.

It is sitting in this pristine new lab – Matalan’s first set of customers were due in later that week – where we continue to talk about how to deliver the very best eCommerce experience.

“The creation of the UX Lab showed our intentions when it comes to really focussing on that online customer,” explains Hornby leaning on the Lab’s brand new table in the centre of the viewing room. “We’re putting a number of flags in the ground externally to show we’re serious about this omnichannel journey we’re on.”

Acquiring talent

After spending the afternoon with Hornby it’s clear he has been very busy since his arrival. In less than a year he’s convinced the board to create the UX Lab, taken the retailer’s eCommerce development up a gear, hiring a number of new roles, as well as launching Matalan’s first ever eCommerce placement scheme – a year-long paid role for University students between their second and third year of study, the application process of which formally launched on Black Friday.

Hornby is really pleased with this progress and it is initiatives like the placement scheme which will help establish Matalan’s digital credentials – because to seriously compete in the digital space, retailers need serious talent to deliver all of the exciting technologies and the slick user experience today’s consumers are demanding.

“The big challenge we face is transport. Once we’ve spoken to candidates and they meet the team and see how well the business is doing, there cannot be many more retailers who are as exciting as Matalan right now. But ultimately if you can’t physically get here that’s going to be a problem.”

“Because of the strength of our omnichannel ambition and our plans over the next few years, we believe people with great digital talent will come and invest a few years of their career, especially as we shift the perception of Matalan to resonate strongly with digital talent.”

In the Liverpool area, Shop Direct is the only main competition when it comes to securing retail talent, while the city also sees technologists flock to the banks and multiple agencies. But nearby Manchester is the big pull for digital jobs. “I think we have a problem in the North West where a lot of our students assume they’ve got to go to either Manchester or London to get digital jobs, but they exist right here, they’re on their doorsteps, they don’t need to relocate.

“But the big challenge we face is transport,” Hornby states with a frustrated sigh. “The transport network in the city is a challenge and it’s definitely a challenge for graduates and the younger demographic who may not wat to buy a car.”

He describes how both public transport and the roads are difficult for those wishing to commute to the retailer’s Knowsley headquarters – I myself experienced road blocks with no diversion signs causing significant delays while making my way to Matalan HQ from Runcorn station 12 miles away.

“Once we’ve spoken to candidates and they meet the team and see how well the business is doing, there cannot be many more retailers who are as exciting as Matalan right now – I genuinely believe that. But ultimately if you can’t physically get here that’s going to be a problem.”

But Hornby is not resting on his laurels and crossing his fingers for an improved transport system to magically appear overnight. For the past few years he has sat on Liverpool City Region’s Digital and Creative Board alongside the likes of IBM, Shop Direct, O2 and the city’s universities. “The conversation around transport and infrastructure is a common conversation across the entire city – we have businesses in the centre of Liverpool who are complaining about the same thing.”

Troublesome public transport and traffic jams aside, Hornby says he has been pleasantly surprised by the retailer’s ability to recruit experienced talent. In recent months he has recruited roles in UX, development, trading, insight and digital marketing, not all of which were local finds, but attracting talent from right across the North West.

“I was just thinking about this when I looked at photographs of the team on Black Friday 2017 and the team on Black Friday this year – we’ve grown significantly.”

Not deploying technology for technology’s sake

Apart from securing the very best digital talent, the big challenge for Hornby and his expanding team is working out which technology the retailer should spend its time and efforts working on. He says you have to be disciplined to concentrate on technologies which will benefit the customer, not necessarily the shiny new technologies that everyone is talking about.

This restraint must be difficult for the self-confessed tech geek, who tells me he has a full smart home set up, with a Nest thermostat and fire alarms, a Ring smart doorbell, and Hornby has even programmed his Phillip Hue lighting system to flash blue when Everton score a goal – much to the confusion of his wife, who rang him while he was out one day asking why their home had suddenly turned into a disco.

One example of a technology Matalan is analysing the benefit of at the moment is voice, but Hornby is quick to clarify this wouldn’t be for searching out products online, but more to help in follow up conversations such as updates on their orders, which could alleviate stress on the customer service team.

“Matalan isn’t trying to be bleeding edge when it comes to technology adoption, because the Matalan customer isn’t bleeding edge, but they may be more adept from the outside-looking-in that you may give them credit for, so we are always analysing new technologies and working out what would make a great use case for it.”

So while customising a customer’s lightbulbs to flash red when their online order has been dispatched may not be right for the typical Matalan customer, it seems the retailer’s eCommerce offering has never been in better shape and will only continue to grow under Hornby’s leadership and ever-expanding team.

Listen to Essential Retail's podcast - the Retail Ramble - to hear our conversation with Hornby about the launch of Matalan's UX Lab.