Retailers are beginning to emulate the idea-incubating cultures that exist within the most successful technology companies, but there is still some way to go before they admit that failure is not always defeat.
Speaking to Ikea yesterday about the plans it has for its recently launched iPhone application, it struck me how much the spokesman from the retailer sounded like he worked for a technology company. And in a good way.
Ikea launched the app – which provides those that download it with a mobile version of its entire catalogue – as part of its experiments into how it can reduce the number of catalogues it prints; while at the same time providing a new way to assist customers when they come to its stores to shop.
Bearing in mind Ikea’s stated strategy to continue to invest in its store portfolio for the long term, it makes sense to try and improve the customer experience. But rather than rolling out a bells-and-whistles iPhone application, it has kept it simple, and instead invited feedback from customers on what they want to see added. The launch of the next version of the app based on this response is to be launched imminently.
Focusing on simplicity, and by building on the development in increments, Ikea has the opportunity to learn from its customers rather than telling them what they want.
At the same time, it didn’t invest a huge sum in the initial application, and had it proved a failure it could have quickly cut its losses and moved on to the next idea.
This is how big technology companies work. They invest a little time and money in lots of ideas, and don’t see it as a failure when they come to the conclusion that some things aren’t going to work. As the balance of power between consumer and retailer has shifted firmly in favour of shoppers, this is how more retailers need to learn to work.
Contrast this with what still occurs in many retail businesses today. I know of a major retailer in another European country which has a reputation for being forward-thinking in technology terms. But in the company culture there is no room for failure. This means that projects only ever make it to pilot stage if the IT department can give a 100% assurance that the trial will lead to a full roll-out. This kind of defeats the point of doing a pilot at all.
Giving people time to think up ideas and ways to express them is the easy (or easier) part of an innovation push. Where the likes of Google, Amazon et al. excel is in the hard part, understanding that it is OK to leave some ideas in the incubator after you’ve invested in them, as long as you learn from them too.