Regal, refined or "majestic" are terms often used in the world of fine wine.
So it's no wonder that connoisseurs and customer service have become the focus points for the growth of Britain’s largest specialist wine retailer, Majestic Wine, as it proceeds along Rowan Gormley’s five-year development plan.
At the forefront of this stands managing director John Colley, who is responsible for Majestic’s entire 211-store estate. He came into the business last September, at a time when it was already three months into its development plan. Majestic made clear that the appointment would not alter its direction, but speaking to Retail Gazette, Colley seemed more than happy with his new role.
Objectively speaking, Colley’s appointment may seem strange, as the majority of his career up to this point has been in the home & DIY sector. He admitted “people think of me as a DIY retailer”, but during his time with Argos, Kingfisher and B&Q he was active in not only managing business estates but also in developing multichannel capabilities. This experience is valuable, and hardly niche in today’s retail world.
After returning to the UK following his tenure at Praxis Netherlands, “a couple of options” were open to Colley. He said Majestic Wine stuck out – for a number of reasons.
“It just ticked a lot of boxes: great category, business and brand, and a big change program," Colley said.
He also highlighted the added bonus that “if you work in retail, you’re always going to be a wine lover".
According to Colley, Gormley’s position as chief executive was another big reason for his joining the group, describing him as a “successful and driven entrepreneur”.
Gormley was appointed CEO of Majestic after it purchased Naked Wines, of which he was the founder and which boasted a digital offering with the potential to transform Majestic’s ecommerce platform. Early into his appointment he said Majestic had excellent growth prospects, but his plan nonetheless drastically reduced targets for new store openings.
This may seem safe in terms of sustainable investment, though reduced expansion can lessen prospective profits, not to mention leave unsettled areas open for rivals. There is also the issue that it could put too much pressure on existing stores to perform.
“Not at all – it’s all about return,” Colley replied, insisting that Majestic’s current estate already gives “pretty good coverage” of the country.
“The goal for the future is to grow our customer base, which has been happening, and those customers we’ve had in the past coming back more frequently.”
Calling improved customer loyalty an “opportunity, going forward”, Colley stressed the importance of maintaining and encouraging the best staff to maximise patron satisfaction. This required a shapeup of existing policies, which Colley admitted had led to Majestic “losing staff for a whole host of reasons".
“We’ve made great progress in giving staff the recognition that they deserve. They get rewarded and feel like they’re on a winning team," he said.
Numbers of staff departures have slowed down significantly over the last few months. Certain managers at Majestic’s peculiarly named “Jedi-stores” even have the authority to run their outlets with more of an entrepreneur-like angle, implementing their own ideas with minimal micromanagement, and receiving recognition in return that encourages them to stay on.
“I think just having the empowerment to do things themselves in a whole host of areas such as recruiting their own teams, contacting customers directly, being practical about how they communicate - those simple empowerment initiatives had a result," Colley said.
“The big one was really around bonuses we pay the manager. The more money they make the more money they make. The Jedi stores have a conus structure not unlike other parts of the company, and have demonstrated that when managers are empowered to look after customers better, it drives growth.”
Colley kept coming back to improving customer experience as he discussed Majestic, especially regarding his view on the rest of the industry. Arguably, Majestic’s specialisation makes it vulnerable to discounters, with customers more likely to buy a cheap bottle of wine from a supermarket aisle while doing their weekly shop than to go to a completely separate store. German discounter Aldi has even won a number of rewards for its wine offering.
“I think it’s fair to say a Tesco or Asda customer is different from one in Majestic stores," Colley said.
"Though Aldi are doing a good job of targeting middle-England consumers, their range is small and their prices are aggressive.”
“Aggressive” prices may have seen discounters consistently take business from competitors, but Aldi’s expansion into wine shows it is not only going to diversify, but it is also determined to back up its prices with quality. In the face of this issue, Colley again emphasised customer experience.
“The Majestic experience is a reason to go to our stores because we have a unique proposition in the sector," he said.
So what exactly characterises this experience?
“There’s a whole host – you can come taste the wines, speak to a qualified member of staff, come to a tasting event, learn about food matching… that kind of customer service can’t be replicated in a supermarket," Colley responded.
Customers that value service and expertise seem to be the life blood of Majestic, and though this demographic may be smaller the company is determined to be its best option. A large part of this is emphasising and showcasing the diversity of its range, which mostly consists of brands from independent winemakers rather than supermarket suppliers: a great prospect for the established or aspiring wine connoisseur.
“We’re able to buy wine from fairly specific winemakers all over the world," Colley said.
"Our volumes are big enough to be relevant to them but not so big they can’t sell to us. We do sell some supermarket brands, but a big chunk of our products can’t be bought from competition.”
Added to that is an emphasis on making employees well versed in the know-how behind Majestic’s products, so that when selling these lesser-known brands customers have a unique experience, and an insight into wine that should hopefully keep them coming back.
Talking about where wine comes from and recommending pairings is a specialised service that is nonetheless a standard, well enjoyed way to expand one's experience of wine. However, it is also a potential casualty of convenience as retail moves more and more online.
Majestic’s platforms reflect this: its website displays several lists, including a "top ten" for its wine offering; a great tool for the specific kind of customer Colley values so highly.
Development is still ongoing, and the future of Majestic’s digital offering will be fuelled by its acquisition of Naked Wines. Purchasing Naked Wines in 2015 gave Majestic access to what Colley praised as a “world class” digital platform, and the now-subsidiary’s “experience and knowledge” is being leveraged to improve Majestic’s own offering.
“We are redeveloping our web experience, both mobile and desktop, and the Naked team are helping us do that. They’re rebuilding our kind of customer experience from a digital point of view," he said.
Customer wants in-store have also changed some of the basic elements of Majestic’s offering, such as the removal of the six-bottle minimum for purchases. According to Colley any “successful” business must know to adapt its offering. His tenure at Screwfix saw the opening of its first outlet stores, after years as an order-only retailer.
“Screwfix stores were unprecedented, but this was how to provide products to customers on the same day,” he said. Screwfix is now the UK’s largest multi-channel retailer for DIY tools and hardware.
“It’s important we’re always developing a proposition that adapts to the needs of the customer. It doesn’t change what Majestic is about. It hasn’t had any significant impact on the volume of wine we sell," Colley said.
With all things said and done, Colley insisted he was “very confident” about Majestic’s future plans, once more returning to “the level of loyalty we have from our customers” as the company’s ace in the hole.
“The advocacy we have from new and existing customers is incredible. They’re extremely loyal, and this puts us in good stead for the future," he said.
“Everything will be down to us. That was part of my role in joining the company. The strategy was laid out clearly by Rowan even before I joined. My job is to execute it along with colleagues across the store.
“With the acquisition of Naked and the plan Rowan laid out, I’m a very lucky chap.”
A flair for wine and confidence in your boss’s plan can’t be a bad combination, and as a testament to Majestic’s drive for specialisation, Colley was happy to make a personal recommendation when given the ultimate wine question: red or white?
“Definitely red. We’ve got a very nice rioja in reserve, very good value.”