Morrisons and Boots bosses speak out as digital strategies continue

Morrisons CEO Dalton Philips said on Thursday that the retail industry is "competing in a world of extremes" and urged businesses like his, which operate in the middle ground, to "stand for something" in order to make their mark.

Name-checking the vast assortment offered by Amazon, the dedication to customer service of Zappos, the low prices of Poundland and the convenience offered by Asos, the under-pressure exec said that mid-range retailers must "work out what matters most" and find their point of differentiation.

Philips was talking at the British Retail Consortium (BRC) Symposium, an annual gathering hosted by the trade association attracting some of the industry's most senior figures, on the back of his supermarket's annual losses of £176 million and at a time when the company is facing growing competition for a share of the customer pound from discount grocery players such as Aldi and Lidl.

He cited Morrisons' fresh food proposition and the unique way it controls all aspects of its food supply chain as distinguishing points for his company.

A host of CEOs and executives from across the different sectors of the retail industry made presentations during the course of the day, including Boots' health and beauty managing director Simon Roberts, who spoke of his business's aim to provide customer "care" and service in "increasingly impersonal world".

Philips and Roberts were commenting within 24 hours of their retailers announcing significant updates to their respective digital strategies, as Morrisons extended its recently-launched online grocery service to London, and Boots unveiled a mobile app that works in conjunction with its widely-used Boots Advantage Card loyalty scheme.

The app means that the health and beauty retailer's customers no longer have to wait for quarterly paper coupons before redeeming their points, but instead can access tailored offers instantly on their smartphones.

Director of loyalty & multichannel at Boots, Ruth Spencer, said the launch showcased the company's "innovation potential", but Roberts admitted on Thursday that the app had been "a long time coming".

In terms of technological development, he acknowledged that Boots has been "learning from others" and "definitely not first out of the blocks", but the mobile app is viewed as a "really important" business move for the company. An extra feature of the app is a barcode scanner, which allows customers to access product information and customer reviews prior to making a purchase, and will enable the retailer to further understand its shoppers' purchase journeys.

Morrisons, too, has been slow to the digital retailing world, having only launched an online grocery service at the start of this year and unveiling plans for its inaugural loyalty programme this spring.

However, last month saw the supermarket launch a unique online price-checker in association with MySupermarket, which gives customers a transparent view of the price reductions made by the grocer as part of its recent 'I'm Cheaper' campaign.

Offering some more background on Morrisons' recent drive to lower its prices, which is part of a £1 billion investment that includes the development of the loyalty scheme and further own range improvements, Philips said: "You can't out-discount a discounter – it's about facing into it and fighting back."

"You've got to be in the game on price," he told delegates at the BRC event.

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British Retail Consortium