Tuesday, 24 April 2012

Never Knowingly Downloaded

The announcement by John Lewis that it has extended its range of services to customers, by launching its first own-branded broadband service, marks yet another stage in the delivery of multi-service retailing by the multiples. In one sense it is nothing new. The retail multiples have been diversifying into financial services, mobile phones and broadband for years and, indeed, this latest move broadens John Lewis Partnership’s existing range of services following the launch of John Lewis Insurance in 2010. It also takes over from the existing Waitrose and Greenbee broadband services whilst broadband has become a commodity purchase in its own right over the last two years, more in keeping with the supermarket shelf than anywhere else. But aside from selling us consumer electronics, most of which would have a wi-fi functionality, what track record or expertise does John Lewis Partnership have in the sector that would make us lean towards them as opposed to another, apparently more specialist provider? And does that matter anyway? The answer is all in the brand. The reputations of some of the pure broadband providers seem to have become tarnished by perceptions of being fly-by-night, offering higher downloads speeds than in reality they deliver, farming consumers out to distant call centres or providing questionable levels of customer service. Although the actual broadband may be being provided wholesale to the multiples via one of the mainstream providers anyway, there seems to be greater reassurance from buying our broadband from a reliable and trusted source. And they don’t come more trusted than John Lewis. In the UK Customer Satisfaction Awards 2011 John Lewis was named as Britain’s Most Trusted Organisation whilst also being voted Britain's favourite retailer for the 4th consecutive year. But herein could also lie a potential pitfall. Whilst the John Lewis brand is already fluid and inherently encapsulates service in its retail promise plus the financial services they offer, how will their service guarantee work when they are reliant on a third party delivering the broadband infrastructure? If they are not completely in control over what they are delivering to people and something were to go awry, would this match consumers’ existing expectations of a John Lewis service? And if it did, would this undermine perceptions of the John Lewis brand across its portfolio? They start from a strong position, though. Already they have consumer trust and the belief among their target base that they are not going to be ripped off by a John Lewis proposition. All they need to do is carry across their “Never Knowingly Undersold” price promise, make sure the speed is good, the customer service up to scratch and they could be onto a winner. One suspects if they didn’t think they could deliver that, they wouldn’t have taken the plunge in the first place.

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