After years of rumour and speculation, health & beauty retailer Superdrug is finally launching a loyalty card next week, as it takes the battle firmly to its high street competitors and continues its process of necessary evolution.
2011 is set to be a year of development for the business as it tries to change its perception among UK consumers, and Commercial Director Steve Jebson suggests that the new loyalty card will make the company stand out from the crowd.
“It’s a mirror card - one side of it is an amazing mirror, which is of course a handbag essential. There’s nothing like it out there in the UK at all,” he tells Retail Gazette.
“Many people carry loyalty cards but actually you need to demonstrate a point of difference - we will be doing that with the offers we provide.”
Superdrug’s great rival on the high street, Boots, has set the benchmark when it comes to health & beauty retail loyalty cards with its Boots Advantage offering, but Jebson suggests that his company’s new scheme is not just another rewards programme.
Instead of just increasing the weight in people’s wallets and handbags, a frequent scenario for many consumers in a world where store and reward cards are available on mass, it is hoped that the Superdrug Beauty Card will truly stimulate loyalty.
“We did some work finding out how many loyalty cards people had and often it was as many as ten or 11 - that’s not loyalty, that’s just collecting rewards, not building a relationship,” Jebson argues.
“Superdrug actually wants to build a relationship with our customers and ensure there is loyalty. We will demonstrably reward people for their changes in behaviour, rather than getting them to collect points endlessly.”
Tied in with the focus on loyalty is the revamping of online operations at Superdrug.
Jebson is approaching his second anniversary as Commercial Director of Superdrug having joined from Woolworths in 2009, and he admits that the company has been slow to establish itself as an internet retailer of choice, perhaps due to some of the decisions made by previous management.
It is full steam ahead under the current regime though, and a new online workforce has been recruited to ensure the company’s approach to internet retailing is done correctly, with the Commercial Director admitting it takes time to make a success of online retail.
“We’ve actually doubled the size of the team in the last two months to start doing online properly,” he adds.
“We are a late developer when it comes to e-tail, but we see its value both as a transactional and educational platform.
“It’s classic multichannel really, we need to make sure that both our stores and website are great places to buy.”
And that is exactly what Superdrug is doing. Another seismic change in the retailer’s operations is currently underway, which will see a large percentage of its property portfolio take on a fresh new look in the year ahead.
It launched its first TV advert for a decade at the end of 2010 urging shoppers to “take another look at Superdrug’, and the company’s Wimbledon outlet reopened in March with new wider aisles, more product information and an opened-up shop front that abandons the promotion-heavy window displays traditionally associated with the retailer.
Products for men have conveniently been moved close to the tills, allowing male shoppers to avoid the female specific aisles if they so desire, while there is a pharmaceutical consultancy room located at the back of the shop.
Although slightly resembling a department store in terms of the way perfumes, colognes and other beauty equipment is arranged, Superdrug is keen to avoid the ‘white coat’ consultancy approach and is happy to give its customer the chance to try products for themselves and pick up knowledge from the newly installed signage.
“We are going to open a number of concept stores in the coming months, and with the different segments of stores we have they will be trialled in a variety of places, from local high streets to shopping centres,” Jebson explains.
“We have found there has been a big improvement in the perception of Superdrug, the shopping environment and the interaction with our teams is better - it is all about providing accessible beauty to our customers.”
Superdrug is a retailer making great strides right now, and it is encouraging to see a business with a predominantly high street bricks and mortar presence take assertive action to draw people back into their local town centres. So how can others follow suit?
“Retailers need to ask ‘what is our purpose? What would customers miss if we didn’t exist?’ and then build on those strengths,” the Superdrug boss notes.
“I believe retailers who haven’t been clear about purposes will lose.”
Jebson’s CV includes stints at Asda and Sainsbury’s, as well as six and a half years at Superdrug’s parent company AS Watson. He has worked on both the buying and supply side of retail.
He is passionate about the high street and its importance to the overall retail landscape and admits if he could find the solution for how retailers could combine to encourage higher footfall in town centres he would be probably be a richer man.
“Individual retailers can do great things to make high streets amazing whether that’s a farmers market, a Primark or a Poundland opening - all of this can reinvigorate an area, offering something interesting and motivating that you can’t get out of town.
“One of the biggest challenges now is how retailers can work together - the high street has a fractured landlord base and is not like a shopping centre where one landlord can take control and decide on a proposition.”
The year ahead will provide an indication as to whether Superdrug has the right formula, but it is arguably too early to assess the impact recent changes have had on the business.
Being owned by Asian retail group AS Watson, Superdrug does not release regular financial results, so it is difficult to get a true idea of the retailer’s current trading patterns and levels of profitability, but Jebson notes that recent measures have been well received and are helping move the business in the right direction.
For example, while many retailers struggled in the snow over Christmas Superdrug reported a 1.7 per cent year-on-year increase in like-for-like sales, the first notable signs, perhaps, that the company’s TV ad campaign starring Gavin & Stacey’s Joanna Page, is working.
“If you’re going to be a bricks and mortar retailer and survive on the high street you’ve got to be good - we looked at ourselves and said maybe we need to update,” Jebson states.
“I aim to make Superdrug a beacon of modernity as a place to shop. We’re not ignoring discount or value, but customers expect more otherwise they have no emotional attachment.”
With the obvious nods to value for money, quality promotions and convenience still very prominent, but with the added bonus of a unique loyalty programme and tidier stores, it appears Superdrug is changing with the times and attracting new admirers, but without alienating its core customers. For the future of the high street, that can only be a good thing.