Having spent 12 years as a researcher specialising in the world of NPD and branding, Pinnington rose to the position of Deputy MD at Research International before joining Incite Marketing Planning as a Board Director. In 2004 she founded Shoppercentric which provide brand owners and retailers, including Travis Perkins, Coca Cola and Philips with the perspective that drives shopper marketing and retail strategies. Now she leads a team of seven staff including an ex head of research at M&S and a director with a decade of experience of providing shopper insight for Sainsbury’s and Cadbury. In the cosy surroundings of Mayfair’s Charlotte Street Hotel, we let Danielle get a few things off her chest.
The big four supermarkets are ‘under pressure’ according to grocery analyst experts Kantar Wordpanel but they are fighting back. Sainsbury’s are set to see their convenience offering outnumber their supermarkets for the first time by the end of the year and Morrison’s will crank out over 100 smaller ‘M’ stores across the UK by the beginning of 2014. This growing trend could prove vital to the big fours fortunes. We discuss the growing trend of supermarket convenience stores and how the big four are adapting to their new locations – just round the corner from where you live.
“We’re getting a sense that supermarkets are recognising that they need to be more tailored in what they are doing. When Tesco launched Extra/Metro originally, it was as if they simply squished it down from a standard supermarket planogram”, she says.
“But what you’re seeing now is they are taking stock from what the local requirements are; whether that’s catering for different cultural needs or reflecting the fact there isn’t anything local in the area for miles around – so you can almost see the thought ‘let’s start selling some local produce. Let’s have an area where you can buy local jams etc. and support the local community.’
“My interpretation would be that that is because they are giving local managers more opportunity to flex, they are recognising the benefit from having a more local planogram. Co-op have always done it, and it’s taken the likes of Tesco and Sainsbury’s longer to catch on. But you’re starting to see it flex more as they are chasing the convenience sector – and that will only work well if delivered against the local needs. I think you’ll see more and more of it, particularly in London.”
According to the ONS report in July on the retail industry, sales volumes sold by retailers rose by 3 per cent as the industry experienced growth for the third successive month and Pinnington believes that talk of the high street being dead is far too premature with British entrepreneurial spirit so prevalent in the UK.
“The development of Click & Collect could help with high street regeneration. We’ve got a very entrepreneurial retailing industry so talk of the high street being dead is way too premature and we’re seeing some really great ideas and innovations out there.
“The high street will look very different but the biggest challenge is understanding what shoppers want and how to tailor an offer to fit them. Mobile could be used to bring people through loyalty initiatives. It’s difficult because shoppers’ needs will change depending on what you present to them. It tends to still feel that retail is about: ‘We’ve got all these ideas and this is what we should do. Rather than, ‘What do shoppers want and how can we create and change our offer to better meet their needs.’”
It is hardly surprising that Pinnington is so focussed on the customers’ experience – her company is called ‘Shoppercentric‘ after all…
Citing an example from 2004 when Asda and Tesco launched TV screens in-store, she affirms the reality that new technology isn’t always the best route to go down for retailers.
“Tesco made a big splash about these new screens and said they’d be the next media channel. Those original systems have long gone. Screens are starting to come back in but are being used in a very different way and that reflects a big issue for retail: just because you can do something doesn’t necessarily mean you should do it. What they didn’t understand was what shoppers needed those screens to say. Now they’ve had more time to better understand shoppers they started to use screens more sensibly.”
Tesco’s major refurbishment of the Tesco Extra store in Watford is a topic of great interest in the retail sector. Could a unique mix of community space and interactive screens make retail even more of a ‘day out’ and a place to meet people rather than just a place to shop?
“(Tesco Extra in Watford) is a stunning store actually, with lots of ideas in there and their TV screens have a real purpose to them,” she says sincerely.
“Here, the screens they are using are interactive, they’re telling shoppers things that they want to know in a way that helps people very quickly. So understanding shoppers is vital.”
Over the last five years, numerous retailers have exited the high street in the wake of fierce online competition and high business rates. Whether Ed Milliband can reverse the proposed business rates rise in 2014 remains to be seen and Pinnington believes that more well-established retailers could continue to go into administration.
“WH Smith continues to worry me. Their travel section seems to understand where they stand and what they’re offering but on the high street it’s still as if they’re saying ‘lets throw just everything in there.’”
The famous quote from legendary investor Warren Buffet “You only find out who is swimming naked when the tide goes out” continues to be apt for today’s retailers. Who could be next on the scrapheap?
She holds the likes of fast fashion pioneers Zara in high esteem but recognises mainstream retailers have a real battle on their hands.
“The mainstream brands continue to have an issue squeezed from below by value fast fashion, and from above by premium brands tapping into quality. Investment pieces come from premium brands now, not necessarily somewhere like M&S as in the old days.
“M&S and Monsoon sit in that middle ground pricing wise and quality wise so how do they keep going and move forward? I think those brands have to be more creative in what they are doing. And if you look at the department stores they have done an awful lot of work over the past few years to change their offer but their challenge is to deliver a coherent path to purchase whether in-store, online or mobile.”
And what about the bread and butter of physical store retailers - good old fashioned customer service?
She tells us with decisiveness that there will be a shift in the way staff is trained in physical stores, “I think there’s going to be a lot of pressure on sales staff to be experts, not just till administrators if you like. Staff are increasingly going to be part of what you go into a store for. “