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House of Fraser Boots Zara

Retail Update: eBay investigates online shopper brand loyalty; Boots Hearingcare campaign ahead of Walgreens takeover; and House of Fraser sale


By Natalie Mortimer, N/A

September 3, 2014 | 6 min read

The Drum's weekly round-up of the retail scene is compiled this week by Natalie Mortimer and features a look at where online shopper loyalty lies when it comes to choosing brands; how Boots is changing its in-store offering ahead of its proposed acquisition by US firm Walgreens; House of Fraser’s takeover by a Chinese conglomerate; and how Royal Mail is adapting its service to meet online shopper demands.

How retailers can prevent customers switching brands

eBay Advertising has highlighted a trend in online shopping habits that has seen consumers shifting brand loyalty in an era of price comparisons, increased reliance on recommendations from peers, and ease of access to product reviews.

New findings from the auction site have revealed that many shoppers consider several brands before making a purchase, with only 37 per cent of online purchase journeys focused on just one brand.

Rob Bassett, head of sales at eBay Advertising UK, said: “On average, ‘switchers’ compare three brands before making a decision; by tapping into rich consumer insights, marketers have the ability to intercept or retain customers before they even consider ‘switching’.

"This also gives brands the potential to grow market share by tempting consumers to switch away from competitors,”

Shopping behaviour has changed significantly as a result of the recession, with consumers placing greater scrutiny on the products and services they want to spend their money on.

One way that Burberry is looking to tackle the issue of brand loyalty is via the release of customisable ads for the promotion of its new fragrance My Burberry.

The luxury retailer is tempting consumers with the ability to personalise its latest campaign ad via Channel 4’s 4oD TV catch-up service. After watching the advert viewers will be able to add their initials to a monogrammed My Burberry bottle which will appear on screen.

Perhaps not the best approach for customer retention came from Zara last week when it was forced to remove a line of children’s clothing that resembled items worn by Holocaust victims.

The blunder was first spotted by an Israeli journalist, prompting online chatter to quickly grow with many slamming the fashion chain’s error.

Alex Johnson, consultant at Insignia Communications asked whether Zara could be forgiven and said “In a climate where there will always be people looking for the next error of judgement or mistake by a big brand it is virtually impossible to make the right decision every time.

"However, learning from previous mistakes (Zara had a similar incident with its ‘swastika’ bag) and putting in checks and balances to reduce the chance of them happening again is key.”

Boots launches new campaign ahead of assimilation with Walgreens

Boots has kicked off a new campaign for its Hearingcare business as it begins to open new locations within its pharmacies - a move that will see it resemble the offering of soon-to-be new parent company Walgreens.

The Great Big Hearing Check campaign, which runs on radio, digital and in-store until 19 September, is supported by charity, Action on Hearing Loss, and aims to raise awareness of Boots' free test offering and the importance of receiving regular check-ups.

While the decision to move Hearingcare within Boots pharmacies wasn’t prompted by the takeover, it will afford the business an insight into how the US chain, which has “quite far reaching” healthcare services within its pharmacies, operates, according to Jonathan Gardner, ‎managing director, Boots Hearingcare.

The news of the Boots Alliance/ Walgreen takeover is followed this week by the acquisition of House of Fraser by Chinese department giant Nanjing Cenbest.

The estimated £148m deal has seen the British department store hand over 89 per cent of its shares the Chinese retail giant, with 11 per cent remaining at Sports Direct after the retailer acquired them in April.

The deal will see the international brands sold through House of Fraser brought to Nanjing Cenbest’s chain of stores, while the Chinese retail giant will develop House of Fraser’s global footprint.

Several markets including China have already been pinpointed as the next countries for expansion of the department store brand.

House of Fraser executive chairman, Don McCarthy, stepped down from his role.

Royal Mail extends offering to meet e-commerce demands

The increasing demands of the burgeoning e-commerce business in the UK has led Royal Mail to extend its opening hours to suit consumers.

The recently privatised group is set to pilot Sunday opening at around 100 of its delivery offices across the UK from this weekend (7 September) in a bid to make it easier for online shoppers not at home during the day to get their parcels.

Royal Mail will also begin a trial of Sunday deliveries to addresses within the M25 motorway this Sunday.

Last month Royal Mail began phasing in a new ‘click and collect’ service to 20,000 small and medium sized businesses as it moved to capitalise on its burgeoning parcels business.

House of Fraser Boots Zara

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