By Justin Biddle, UK Lead at Shopware
Primark’s new click and collect service is its biggest commitment to ecommerce since its bold decision last year to launch an online site that would act as a digital catalogue. While an online catalogue showed the high-street retailer was dipping its toes gently into the world of digital commerce, click and collect is a substantial advancement, especially given its long-standing resistance to multi-channel expansion.
Primark’s resistance to shifting online
There is no doubt that the lockdown has exacerbated the need for Primark to get online. After all, Primark needs to go where its customers are – and those customers are increasingly shopping online. However, there have been multiple reasons why Primark has not done so.
It’s important to understand that Primark’s store-based model has – and continues to be – an immensely popular and profitable channel. So much so that once lockdown restrictions eased, there were nationwide queues of shoppers outside its stores. Due to its low price point, expanding online just didn’t seem to be a particularly compelling proposition when you factor in the cost of shipping and returns. The real question is – why invest in online at all?
The retailer has been somewhat tactical in its strategy to choose click and collect as its launchpad into ecommerce. One of the primary concerns for any retailer implementing a new channel is that it might cannibalise revenue from existing channels rather than create an entirely new revenue stream. For Primark, click and collect is a way to introduce a digital channel that serves only to enhance existing sales channels, and which additionally provides shoppers with greater convenience and flexibility.
Primark’s lack of tech experience
Primark is pretty green when it comes to deep tech and this could affect success in the short term. It has left it so long that the brand is now up against competitors that have a ‘digital first’ mindset and have streamlined their online experience and processes and learned from years of painstaking trial and error. If Primark fails to deliver an experience that satisfies unforgiving consumer demands then it could put a serious financial and operational strain on the business. Whatever happens there will be disruption to its store network as staff are trained up and stores are remodelled to cater towards this new service.
Harnessing a test and learn approach
Though click and collect makes sense given the retailer wants to still maintain sales from its stores, it is not the easiest nor the safest route into ecommerce. It could perhaps have focussed more on a test and learn approach first with a limited set of customers. One alternative could be to harness its loyal customer base and launch a VIP customer site where loyal customers are rewarded through exclusive previews on new product lines. This adds a layer of mystery and exclusivity for shoppers and is also a good way to understand who its loyal customers are and how it can retain them. This approach also has the advantage of being manageable in terms of scale, by giving it time to learn and understand how ecommerce can best work to their advantage. From this, there are endless opportunities, such as turning it into a subscription service if demand is there in order to superchange customer retention.
Primark is undertaking a huge challenge in its click and collect service and it is an ambitious first step into the world of ecommerce; it will need to deliver to high customer expectations if it wants to succeed. If Primark is serious about fully expanding its offering to online, then it must ensure that a culture of ‘test and learn’ exists from the start, so that it can build its expertise gradually without harming revenue or customer goodwill. Primark can find success online, but it needs to understand that the already highly competitive landscape will not make it easy.