John Bovill, Group IT Director for Aurora Fashions, says that consumerisation is quite simply changing how his company operates.
“The fashion business was a push model; we used to push out to the market,” he says, looking back at how recent technology-led transformations have affected his sector. “But consumerisation is turning that push model on its head. What we have now is a pull model, where customers are shaping their own buying experiences.”
Such tech-savvy individuals now have easy access to high-powered mobile computing in the palm of their hands. These devices are being used to purchase goods electronically and they are being used to connect to, and influence peers, in online social networks.
The result of consumerisation for a company like Aurora Fashions – the parent company of brands such as Karen Millen, Oasis, Coast and Warehouse – is a shift in how electronic commerce is managed and monitored. Estimates suggest that peer-influenced word of mouth is the primary factor behind as much as 20 to 50 percent of all purchasing decisions, according to consultant McKinsey.
Consumerisation, then, is affecting which goods are talked about and purchased. Big business must be ready and Bovill says Aurora has taken strategic steps to deal with the popularity of social media. The fashion group has already developed a strong Facebook and YouTube presence, but has concentrated primarily on mobility.
“Our business is very, very simple. It’s about delivering what the customer wants. Our customers are interacting with us and we need to have an underlying strategy to deliver to the changing way in which the customers are touching our brands,” he says.
“I think what we’ve all recognised is that, if you think about the devices that people use, we now live in an information age. The sales of mobile devices, tablets and smart phones are going to outstrip PCs this year, and the reality is that customers are interacting with our brands through mobile technology.”
The group – which has about 500 stores in 48 countries, and an annual turnover of £700 million – heralded the beginning of its consumerisation strategy through the deployment of e-commerce sites for all its brands. The benefits of that move are already clear, with 10 per cent of Aurora’s revenues now coming from online sales.
Such developments, however, are just the start of the company’s consumerisation strategy. Sales proportions for the online side of the business are growing at a double-digit rate year-on-year. And eighteen months ago, the group deployed its first iPhone application for browsing products online.
Bovill estimates the app took about three months to develop. The retail giant drew on the expert help of an external agency and has since gone on to develop apps for all its brands, with a continual improvement process set in place. Overall costs, suggests Bovill, are minimal – but the results for Aurora are noticeable.
“Because we have common systems and platforms, it’s relatively simple to introduce new apps,” he says. “Once we go live for one brand, then we can commoditise the app very quickly and roll it out to the other parts of the company.”
Some of the initiatives being undertaken by Bovill are very smart. As well as offering users the option to buy products through the application, one of the group’s apps allows users to buy and text mobile gift vouchers. Recipients are sent a unique code by text that they simply enter into the chip and pin system at tills to redeem their vouchers.
“I think we’re slightly ahead of the curve,” says Bovill, a somewhat modest claim given that the group’s social media developments are receiving wider praise. Oasis’s app won the Oracle Retail Week Retail Technology Initiative of the Year award in 2010.
Further steps to build on this strong mobile platform strategy are already being taken. In conjunction with BT Expedite, Aurora recently implemented a web services layer on top of its till and customer relationship management applications. The layer creates standards that allow the company’s e-commerce systems to be platform-independent.
Retailer Warehouse implemented the layer in August last year and other brands have subsequently gone live. “It’s a key factor,” says Bovill, referring to the successful implementation of web services. “You can only deliver across brands if you use a standard deployment method. And as a result, we’re now in the process of rolling out a mobile agnostic web site, so we can deploy apps onto any device, whether it’s operating system relies on Apple, RIM or Android.”
What becomes apparent is that the Aurora has embraced consumerisation. It is quite some achievement, but other CIOs should note that the creation of a consumer-centred focus requires a transformation in thought processes and attitudes. To fully embrace consumerisation, says Bovill, the entire business has had to think differently.
“We’ve changed structurally as the type of technology and the customer interaction have matured,” he says. “Now, when we’re deploying a front-end web design, we think about the mobile format. And when we think about a change on the web side of the business, we think about what impact that will have on the stores. It’s becoming ingrained – we think across all the channels now.”
Further innovation could come in the form of quick response bar codes and radio frequency identification tags. The use of such technologies in-store would potentially allow customers to scan codes and price tags with their mobile devices, allowing individuals to find out more information about the items they are considering buying. That development, however, is still some way ahead.
“We need to be conscious as an organisation deploying technology that we are in a period of considerable change,” says Bovill. “What underlines everything we do is that it has to be fit for purpose. We have to remain true to the fundamentals of business and be careful not to get carried away too soon.”
He says selections of which technologies to adopt need to be based on more than an enthusiasm for what is new and cool. CIOs have to pick what is appropriate. Bovill, for example, says there are a lot of conversations about the use of digital media in stores and the potential deployment of kiosks. However, he questions how appropriate such technology would be given the context of store size.
“Technology is important, and is much more customer-facing than it used to be. But we are a product-led business,” says Bovill. “We’ve always got to remember the implications of change on our core business aim of fulfilling orders at various touch points. We’ve got to deliver what’s appropriate and fit for purpose, based on the environment in which we trade.”
Despite such caveats, Bovill says companies who are half-hearted in their adoption of consumerisation face problems. “It’s where the customer is moving and it is a trend that will gain critical mass before most people realise,” he says. “You have to really try. If you don’t, anything else you do will look defensive and you won’t be relevant to the customer segments you’re after.”
And Bovill has clear advice for companies that are looking to adopt consumerisation. The key factor, he says, is strategy – Aurora was very clear from the beginning that it was going to offer a multi-channel approach to the customer which catered for the web and was device agnostic. Beneath that strategy, Bovill provides support through clear policies and procedures.
“Always listen because people always have an opinion on technology. Understand how customers use technology and how they are going to interacting with your brands. Then use that information to better inform your strategy,” he says.
“Be very open to ideas, but understand the core of your business and recognise potential limitations. Where you are implementing new consumerisation strategies, make sure they are appropriate and aligned with the DNA of your business.”