As retailers such as Nike and Apple have shown, brands can often breathe fresh ideas and expertise into retailers and their customer service.
I have a bit of a thing about mobile phone shops.
Where I live in Putney, Southwest London, there is a relatively small and low-key retail offer comprising the high street and a small shopping arcade. However, there are no fewer than seven shops selling mobile phones.
Actually, there are now a mere six, following the demise of Phones 4U.
Will it be missed? Does the consumer really need so many stores selling one consumer product? Why do the networks feel the necessity to have their own stores?
Manufacturers and brand owners often complain that the retailers of their products act in such a way that they dilute the value of the brand. The effort put into design, production, glossy advertising and celebrity association by the brand owner can be destroyed in an instant by a shoddy store environment or poor customer service.
I always remember a senior executive at one car manufacturer lamenting that after all their efforts to create a positive and inclusive image for their products, it was destroyed in some garages by a supercilious or chauvinistic salesperson who virtually asked the question “so what colour would you like, love?”
Inevitably brands become tempted to show retailers how to articulate and sell their products and services, and so they set out to open their own stores.
The Niketown stores that opened in the 1990s in New York and Chicago dramatically illustrated the breadth and authority of the sports and products covered by the brand. The evocative clips of momentous sporting achievements, shown every 20 minutes or so on a giant screen in the store, left the consumer in no doubt as to what Nike stood for.
In the past consumer electronics –rather like my car example above – had always been retailed in a dull, sterile, macho environment. The customer was discouraged, or even prevented, from trying out the product.
It took a manufacturer to show them how to do it properly. Thirteen years ago the first Apple stores opened in the US, created by the same design agency that had worked with Nike.
Today, Apple stores are the shining example of how to retail consumer electronics. In the Regent Street store there are no till points, no shelves groaning with boxes, just tables on which you can play with the product.
Years ago, BT, British Gas and the various electricity boards all had retail outlets selling both the utility service and its related consumer devices, rather like the mobile network providers do today. Over time these outlets were closed, partly because other retailers – John Lewis, Dixons, Currys, Comet – simply did it better.
You could argue that mobile network-owned stores have added complexity and confuse the consumer. In an attempt to provide differentiation from one another, each one presents the consumer with myriad contract and handset options. The suspicion is that if it weren’t for the highly profitable business of providing the mobile network service, the retail stores might not exist.
All of which makes the merger of Dixons and Carphone Warehouse seem a very sensible idea.
- Peter Williams is chairman of Boohoo.com and a former chief executive of Selfridges