Shopping in Oxford Street

John Lewis goes ‘digital first’, a reminder that branding is just part of the equation

The move to digital has been the most important business story for the past two decades. So it didn’t surprise me to hear John Lewis announce that it was to become “digital first”, despite the fact that it is best known for its brilliant shops, full of nice things and a good café. Its Oxford Street store has an outside balcony where you can go for coffee, looking out over the busy street. But I always liked print newspapers, too, and magazines printed on coated paper. Yet for the past 15 years we’ve all known that the convenience of online is more compelling.

It has been a difficult year or two for John Lewis. Before then, at marketing conferences and events, speakers would present an emotional Christmas advert by John Lewis and highlight that the company was amazing at marketing. I did generally like those adverts, even though I’ve always been sceptical of those in the advertising community to assert that a frequently displayed TV advert is always directly responsible for a company’s profits. I mean, cost control, point of sale promotion and convenience are other, often more important, factors in profitability.

Yes, John Lewis has done a fantastic job at establishing its brand. It has made itself totally dependable in the eyes of the public – and I like shopping there. But its unwelcome financial results, closure of stores and restructuring of staff is a reminder that branding is not everything. In fact, when companies drink too much of the branding Kool-Aid they can remain wedded to minor brand points that have no relevance in the modern world. Does “Never Knowingly Undersold” mean anything when you can check easily prices on Google, when they’ve excluded online retailers, and when we all know that the group’s food stores are expensive but better?

The MIT academic Donald Sull talks about how companies, responding to a change in the external environment, often engage in “active inertia”. They double down on what they did in the past in the expectation that it will work again.

Fortunately, John Lewis – at least in its words – seems not to be falling for that trap. The challenge now is in implementation. Its high street business could be both a useful source of cash and a complement to the online shopping experiences – as with Apple – or a hinderance to making the difficult decisions. Only time will tell.

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