Magazine article Marketing

Brand Health Check: John Lewis

Magazine article Marketing

Brand Health Check: John Lewis

Article excerpt

The retailer has lost some of its lustre, but are the Olympics really to blame, asks Joe Thomas.

John Lewis' decision to blame declining sales on shoppers being distracted by the recent Olympics and school exam results will surely be ranked by excuse-watchers as about as plausible as that used in 2002 when some companies pinned their corporate misfortunes on the death of the Queen Mother.

Everyone knows it is a worrying time on the high street, but blaming Beijing 2008, which could have boosted the retailer's sales of sports equipment, seems disingenuous. A reading of the runes shows sales have fallen on 11 occasions in the past 17 weeks.

John Lewis, whose profits fell 27% in the six months to July, has become renowned for catering to the needs of the middle classes. But, as the recent slump shows, the retail giant might need to assess its appeal to customers. Increased competition from online retailers means John Lewis can no longer be 'Never knowingly undersold', and the retailer needs to come up with compelling reasons for people to shop at its stores.

Although its decision to invest heavily in renovating and developing stores illustrates that the partnership is building for the future, there does seem to be an image problem. The decision to use supermodel Karen Elson in its latest ad campaign gives an indication that this is being addressed, but will it be enough? We asked Alistair Green, planning group head at Bartle Bogle Hegarty, who handled the KFC and Levi's accounts, and Steve Hastings, planning partner at Isobel, who has worked on Harrods, for their views.

DIAGNOSIS

Two experts offer their advice on reinvigorating the John Lewis brand

ALISTAIR GREEN, PLANNING GROUP HEAD, BARTLE BOGLE HEGARTY

We have all been bombarded with the same dismal headlines, 'Recession fear' and 'It's going to get worse before it gets better'. It is not surprising retailers are suffering, including the British stalwart John Lewis, although M&S, Next and Laura Ashley are even worse off.

There are four tenets to a successful retail business: store, service, price and difference, and in all four John Lewis deserves pretty respectable scores.

Store - its decision to hold back marketing spend to fund large-scale refurbishment to its estate was sound.

Service - its level of service is superior to the competition, because employees enjoy the benefits of ownership.

Price - for its middle-class target, John Lewis is broadly competitive, although it is being challenged by e-shop prices, especially on electrical appliances. …

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