Brief History:
John Lewis was first founded in 1864 with the first store
opening in Oxford Street, London. The organisation is best known for its policy
of “Never Knowingly Undersold” which has been in use since 1925. They have also
won many prestigious awards over the years including Multichannel Retailer of
the Year, Best Online Department Store, Britain’s Favourite Retailer, Most
Trusted & Reliable Organisation (as voted for by consumers) and more.
Overall the business offers its own-branded product ranges
spread across numerous departments (as explained later) and “The John Lewis
Partnership”. This includes a partnership with supermarket chain; Waitrose,
John Lewis Insurance and Broadband services. Many previous customers have
praised John Lewis well as target audiences are appreciative of the fact the
department store has everything you could possibly need all under one roof.
The brand likes to regularly “give back” to their loyal
customers, thus offering a Partnership Card. Customers can earn discount
vouchers every time they spend within store, online or at Waitrose/Ocado. The
card also allows online security, access to exclusive cardholder events and
early-previews to special offers/sales throughout the year. John Lewis’ financial data
for 2008-2012 are shown below. The own-branded product ranges account for at
least 30% of these overall sales.
Financial Performance & AdSpend:
According to Mintel (2011), Nielsen recorded that advertising
spend by leading department stores advertisers increases by 10% each year. In
2011, the biggest ad-spend increases were seen by Debenhams and John Lewis,
both up by more than 28% than the previous year. 2011 was also a year of high
investment in major brand-building television campaigns by Debenhams, John
Lewis and M&S.
A
comparison of the target audience profile of John Lewis in comparison to other
department stores within the industry sector is shown in the figure below. Mintel indicates that “Other” includes
Harvey Nichols, Beales, Fortnum & Mason and Liberty which were original
options as part of the research study but returned sample sizes too small to
analyse in comparison to the overall results.
The John Lewis Own-Brand:
The John Lewis Own-Brand product range was first established
in 2001. During September, 2005 the organisation launched a trial range of
own-branded household appliances which proved to be extremely popular amongst
consumers. A limited edition range of electrical appliances including washing
machines and dishwashers were introduced in stores and online to see how they
would fair with customers. The demand for the products massively exceeded
expectations and in the Peter Jones store along, the range accumulated £1m in
sales over just seven weeks (Mesure, The Independent, 2005)
Merchandise Director, Jill Little said:
“It shows just how much trust and
interest there is in the John Lewis own brand. There is a lot more of this to
come”.
After its overwhelming success, the company decided to push
forward with this and plan major product-lines labelled with their own brand
name. Implementing this mirrored moves of supermarket chain, Sainsburys who
launched their own-branded items shortly before. Over the years, John Lewis has
collaborated with numerous high-profile designers to help launch their own-branded
lines of products from furniture and home wares, to clothing, to beauty. The
business has produced a wide variety of affordable designer-ranges exclusive to
their brand. In 2004 alone, own-brand lines account for 27% of overall sales,
or £130m as has risen by more than 10% in recent years.
More recently, John Lewis unveiled “its biggest-ever own
brand with the launch of a new home range online and instore” in September 2012
(Harrison, Retail-Week, 2012). The John Lewis Partnership Chairman Charlie
Mayfield identified the own-branded range as a key strength of the overall
organisation and the team has “upped the pace of product innovation”.
“Developing products you cannot buy anywhere else has never been more
important” he said.
John Lewis opened numerous own-branded “shop-in-shops” spread
out over 3,000 sq ft. as well as a designated area to the range via the online
webstore for their new line; “House by John Lewis”. To date, it is the biggest
own brand launch for the retailer in terms of investment and number of lines.
Continuous results have shown to be successful and customers are reminded to
keep a look out for more John Lewis product lines to be released throughout
2013. In addition to the home ware and furniture ranges, the organisation also
offers three own brand womenswear collections, two for men’s and
children’s-wear. The John Lewis PR agency (Rain Communications) regularly works
extremely hard to help promote these collections and additional information
regarding Rain’s services for John Lewis is continued on page 39.
Own-branded womenswear and menswear currently include;
- “John Lewis Women”: A collection of everyday essentials
- “Collection”: Smart work-wear still suitable for heading out
- “Collection Weekend”: Casual-wear range of wardrobe basics
- “John Lewis Men”: Style essentials for work or play
- “John Lewis & Co”: A range of Heritage-focused seasonal pieces, with emphasis on craftsmanship
The John Lewis clothing brand also regularly launches
limited-edition collections throughout the year forming collaborations with
stylish, high-quality designers at an affordable price. Each collection build
upon previous successful pieces, ensuring the elements customers loved the
first time around are interpreted in a new and exciting way appropriate for different
times of the year.
Overall, the John Lewis own-branded product ranges are going
from strength to strength offering customers a wide variety of choice. The
company are also proud to announce that they are the “only European retailer
whose entire own-brand range of large electrical appliances are A-rated and
above for energy efficiency” (johnlewispartnership.co.uk, 2012). As well as
being extremely profitable to the overall business, the own-brand helps to set
John Lewis apart from competitors. Head of Womenswear Buying Jo Hooper says;
“John
Lewis are the only store that has its own range of jersey, cashmere and
lingerie to rival our competitors, as well as powerful brands in clothing and
accessories. That gives us our USP, making us more special and creating strong
sales growth”.
According
to Mintel, John Lewis is not only the market leader and most consistent
long-term performer within the department-store industry; it is also the only
full-range department store chain, though Fenwicks comes slightly close. “John Lewis’ commitment
to the full range concept remains very much in place, on the basis that the
integrated offer pulls in customers and leads to many cross selling
opportunities”. (Mintel, 2012). The pie chart below reflects John Lewis space
allocation for each of their departments (including their own-name brands) as
of February, 2012;
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