We thought we had heard the last of BHS, the high-street retailer which very publically fell into administration in April this year. But just as the media hype had started to subside, fresh news emerged of an unlikely proposition, and last Thursday the antiquated department store was resurrected as online retailer, BHS.com.
Despite failing to stay relevant on the high street, some might argue the revival of BHS.com represents a real opportunity for the store to reinvent itself in the fast-growing market of online retail. Without the burden of an outdated shopfront, BHS.com will be able target a new, digitally native generation alongside its more traditional and loyal fans.
However, BHS.com is launching at a time when several of its competitors have stepped up their efforts online, due to the steady decline in high street footfall. John Lewis, among others, is investing heavily in omnichannel technology, recognising the need to focus more on online customer engagement. And it’s not just rival department stores that BHS.com will have to contend with. The site will now be up against much newer players in the market, such as Made.com, which has built its entire business model around the online user experience.
The challenges BHS.com will face in the early days will no doubt centre on building a volume of customers, while still ensuring customer service matches the brand promise. In my experience, it is the ability to control scale that often overwhelms online retailers in this phase. Businesses that are successful grow quickly and, as a result, the customer often gets forgotten. Not in the sense of service but in terms of who they are and how best to engage with them. Returns and complaints processes may be top-notch but up-sell and cross-sell engagement of customers falls by the wayside. Too often, everyone is treated as the same “type” of person and retention rates plummet.
BHS.com will have to mine its customer data from the outset in order to forge ongoing relationships with shoppers. The question is: what data and information does it have on its current shoppers that can be used to leverage a relationship online? Any customer data from its previous incarnation should be analysed and used to find these people online, and more traditional techniques such as email marketing used to warm them up.
From day one, the site’s data gathering and permissions for use of data need to be set up correctly. BHS.com should be transparent about how it uses customer data in order to build trust. Data should then be monitored constantly to track how customer types are changing and diversifying so that targeted marketing strategies can be developed accordingly. According to CMO.com, 75% of consumers get frustrated when offers, ads and promotions have nothing to do with their interests. These kinds of mistakes are easily avoidable with the right data strategy in place.
Unfortunately for BHS.com, its “iconic British brand” is not enough to convince today’s promiscuous online consumer. The customer experience needs to be seamless and if BHS.com harnesses its data in the right way then it could become a remarkable success story. We will wait with baited breath.
Scott Logie is managing director of REaD Group Insight