‘Retailers must innovate to survive’

RETAILERS must innovate or die, Asda’s chief executive Andy Clarke told a major conference in Yorkshire yesterday.

Mr Clarke told the summit in Leeds that innovation in online retailing is being led by the UK, at a time when many consumers are surviving on a tight budget, and using hi-tech devices such as smartphones to place their orders.

He was one of the keynote speakers at the Leeds City Region Retail Innovation Summit, which was held at the Asda MCE centre, in the Old Carlsberg Bottling Plant in Leeds.

Sign up to our Business newsletter

The summit, which was supported by Leeds and Partners and UKTI, showed off the region’s rich retail talent and acted as a platform for debate about sustainability and investment.

The event provided Asda with the opportunity to show off one of its latest innovations - a 3D scanning device that can make tiny models of shoppers.

“What’s the importance of having a five inch model of yourself?’’ Mr Clarke said.

“We’ve just been incredibly surprised by how quickly customers have embraced this piece of technology. In Trafford Park we launched our first 3D scanning booth. It has a queue every day. We’ve been surprised at how people want to use it. So it’s grandmothers coming with their grandchildren, so they can watch them grow.”

The 3D scanning system was also proving popular with families of armed forces personnel, who were about to be posted overseas, and newly weds.

Mr Clarke added: “I would say we’ve seen more change in the last five years (in retail), than in the previous 25 years.

“Our customers want to shop 24/7. Online shopping has fundamentally changed the shape of the industry.

“One thing is absolutely clear. Those retailers which manage the interface between digital and physical will be the long term winners. I’m absolutely certain of that.

“Those retailers that have managed their property estate in the right way, to grow and develop, and intersect the digital agenda will win in the future.”

New research shows that 32

per cent of online orders are now made on smartphones, which was another sign that the world has changed, said Mr Clarke.

He added: “The proportions (of shoppers) are still significantly more in stores, but of-course the growth is driven out of how the online space is growing.

“This year, we’ll have 670 click and collect sites. That’s just our business. Being a retailer in this market is incredibly exciting.

“It’s exciting if you’re a retailer who is innovating..There are many businesses that are struggling and find life challenging.

“If you don’t innovate, you’re going to slow down and eventually you’re going to die.

“The economic situation has changed how our customers think,’’ he added.

“Every month we prepare a document called the Asda Income Tracker. It’s become richer and richer in data over time, as we’ve given it more credence.

“We’ve developed it as a tool to help us run our business more effectively. What does it feel like if you’re on a budget in Britain? And how much disposable income have you got?”

“Innovation in the online space is definitely being led from the UK. Retail is exciting, it’s changing, it’s evolving and it’s evolving fast. If you’re in retail you know that. What will retail look like in five years? Well. we’re making our guess. Strategically we’ve been reviewing our business over the previous 18 months. We launched our strategic plan in November last year. We’re now in an execution phase of that plan, which is challenging at times. You’ve got to stay ahead in this industry if you want to survive. In five years’ time. there will be more change. Who knows what the fascia of the high street will look like in five years?

“It could look very different from what it is today.”