Primark has taken another step towards a fleshed out e-commerce offering, albeit on a very limited trial basis to date and still with an emphasis on the store network.
Back in April, the fashion retailer upgraded its website - not before time - but maintained it’s longstanding argument that the operating model of the firm is not compatible with full-blown e-commerce. At around the same time, diginomica noted that Primark was performing better in the Vaccine Economy than a number of pureplay internet-only competitors which had thrived during the COVID shutdown of physical outlets.
Flash forward a few months and Primark is now about to trial click-and-collect in a limited exercise centered on the North-West of the UK and focused on children’s apparel. Is this the first step towards something bigger? Well, perhaps, but as CEO Paul Marchant makes clear it’s first and foremost about making the stores bigger on the inside than they are on the outside. This TARDIS-like thinking is intended to bring much more of the Primark inventory to the physical outlets than is currently possible:
We are space constrained in many of our stores. If you think about the complexity of a kidswear offer, you have babies, you have younger and older kids, you have accessories footwear, essentials nursery - there's a lot to try to fit in, particularly in the average stores and even more so in the smaller stores. So what we're looking to do here is to offer a much expanded range of children's lead products, complementing the already strong in store offer. So we are looking to build our click-and-collect proposition to some 2000 options across all areas of kidswear, from newborn right the way through the teens.
And if you look at the components that make up the product proposition, it’s very exciting that 40% of the total options that you'll see on the click and collect offer will be exclusive to click and collect. You will not be able to find those in any of our stores, including the large stores. If you're an average sized store, you'll typically have double the choice now that you currently have, through click and collect, and in smaller stores you'll have up to four times the product choice that you currently have within the four walls of the stores.
As for the choice of the North West as the trial region, Marchant explains:
We like this region. It gives a very good representative sample of different store types and different stores sizes. On average, the stores within that cluster will be 43,000 square feet, which is bang in line with our company average. However, there's a huge range of sizes within those 25 stores. So, for example, the smallest store is 13,000 square feet, which is in Wallasey, which is based about six miles outside of Liverpool city center, up to 150,000 square feet in Manchester city center. We're targeting the launch towards the end of this calendar year. We really expect this to drive high footfall to stores and deliver incremental sales, both through existing and new customers. It's about giving more choice to our existing customers, it's about driving new customers into Primark and giving our customers more reasons to shop with Primark and visit our stores.
There will be physical alterations within stores to accommodate the increased online offering, he adds:
When the customers arrive in store, we want them to have a great experience when they come to collect their order. So we are creating new designated areas in the heart of the store from where the customers will collect their orders. We've achieved this by repurposing our current customer service desks. We've recently moved our returns away from the customer service desk to now be able to be a place for all of our sales in store. This means that we can repurpose the customer service desks and have no reduction of our store selling space, which is very important. We have clear signage to navigate the customers to this department throughout the store.
Customers can select a nominated collection date up to a week in advance which is really important. We will notify the customer as soon as their order is ready. Click-and-collect orders are free for the customers to collect and will also accept returns free of charge in store. All the click-and-collect orders will be processed and dispatched to store from a UK distribution center based in Leicestershire. Our product suppliers will prepare the majority of the stock to be e-commerce-ready. For the duration of the trial, the replenishment and the distribution to the stores will be a manual pick-and-pack operation. We believe this to be the most pragmatic and cost-effective way to get the site up-and-running. We have a great partner in Clipper who we have worked with on logistics. But I think once we have the results of the trial, we will look to automate that proposition.
And of course, the underlying tech stack has had to be upgraded to support the new initiative. Oracle has been implemented as the main tech platform and is now present in all stores and depots throughout the company. Primark is also tapping ino A new EPOS system is being rolled out across the network, while there’s also been a push to bring in management talent from the likes of ASOS, Net-a-Porter and Farfetch among others to complement existing in-house capabilities.
As for the relaunched website, that’s working well, Marchant concludes:
We designed the site to be a mobile-first design. Nearly 85% of all traffic accesses our website through mobile devices. We have a much richer product content, multiple images per product, multiple colorways per product, still at the same amazing price that customers love and also highlighting sizing information to help the customers work out what size is appropriate for them. In terms of the content of the site, we're now showcasing 70% of that total product range, up from only 20% on the old site. Very importantly, our customers are now able to check the availability of the product that they're looking for in their size in their chosen store. We really believe that that's a great route to drive footfall, ultimately drive conversion.
We're very pleased with the response from our customers to the new site. There's strong performance from all the metrics that we are measuring. Firstly, it's important to say the traffic in totality is up around 60%. Since relaunch, customers are viewing double the number of pages they were versus the old site. Very significantly, about 15% of the visitors are using that new stock checking facility. It's a new functionality and bearing in mind this is a strong indication of the customer's desire to purchase and therefore visit store, we are really pleased with that number.
It might all seem a bit cautious in its approach compared to some, but this sort of trial is standard practice at Primark as George Weston, CEO of the firm’s parent Associated British Foods, reminds us:
Trialing is how we always enter new markets. We trialed five stores in the north east of the United States when we first went in there. It's how we learn. It's how we optimise. Trailing has stood us in really good stead in the past and we don't apologise for doing so, again.
There’s still no sign of any kind of delivery option anytime soon. As for how wide the click-and-collect offering gets rolled out…watch this space.