NRF 2016: “The age of multichannel is over,” says John Lewis

John Lewis has warned retailers that thinking about multiple channels – in store and online– is detrimental to business growth in the digital world.

Speaking at the NRF Big Show 2015 in New York City this week, chairman of the John Lewis Partnership, Sir Charlie Mayfield, said: “The age of multichannel is over.”

He told delegates retailers need to completely integrate their channels because the notion of two different channels is “incredibly unhelpful”.

Mayfield said 40% of John Lewis’ sales now come from online, but the retailer is also aware that 80% of its most valuable customers shop across both channels, while 75% of all transactions in John Lewis include some component of online and the store – whether it is research online and shop in store or vice versa. 

He said while businesses which have a smaller percentage of sales from online can get away with thinking of two different channels, it is still dangerous. 

“That’s thinking from 10 years ago,” he said. “Every customer in the land is shopping on Amazon and that’s where expectations are set. I don’t like the term ‘omnichannel’ either because ‘channel’ is a language retailers speak and it is increasingly not understood by customers.”

He asked the audience: “What language do you speak? Channel or customer?”

He said those who speak ‘channel’ worry about like-for-likes while building up an online business which is fighting against the tide. But those speaking ‘customer’ are embracing the digital change.

“Many retailers – myself included – are focused on sales and the ability to optimise the square footage, but with the internet, that concept is not helpful, it’s dangerous.”

But he added that speaking ‘customer’ requires investment in IT, supply chain and data. “It’s a very different mind-set and still requires huge focus. If people are going to go to a shop it can’t be a mundane experience.

“You can’t be half and half on this,” concluded Mayfield, saying retailers need to embrace the future. “John Lewis hasn’t made that full transition yet, but we’re definitely on the way and committed to doing so.”