WOOLIES IS BACK! (And so are its demons)

After Christmas’s dirty, drawn-out process of administration that left a gaping £385m debt chasm, Woolworths is making a come-back – but this time, you’ll only be able to find it online.

In a deft move to side-step the crushing rental prices of the 807 larger-than-your-average stores nationwide, the power of the Woolies brand lives on but without the expense of staff, rent, business rates et al. Whose clever idea was this? None other than Littlewoods owners and power-brothers of the financial world Sir David and Sir Frederick Barclay, who own Shop Direct. The firm reportedly bought the brand name for somewhere between £5m and £10m. And with the strategic thinking of Littlewoods Online behind it, one of the UK’s largest online retailers, Woolies future should be looking bright.

But is it? We’ve had a look around the new Woolworths.co.uk, and we’re not so sure.

The site gets big ticks for being super-easy to navigate, and for the marketing concept of having a ‘Very Important Family’ club, where users can register to get special offers while getting the warm brand-affinity feeling they’re ‘joining the family’ (nicely playing on the nostalgia so many people still feel for the Woolworths name). Apparently 20,000 people registered on the site within a few hours of the announcement it was making a return.

And there’s a nice bit of CGI animation for the kids as well as an interesting (although slightly pointless and token) map of what other people are buying around the UK in real time.
 

The shop is split into three parts – main shop (kids focusing on kidswear, outdoorsy stuff, electronics and gadgetry), entertainment shop and pic’n’mix shop.

And herein lie the problems. Firstly, who wants to buy pic’n’mix online? It’s an instant buy, a treat, and on-the-spot novelty. And it’s not like the majority of supermarket stores don’t offer it anyway – it’s something to keep the kids happy while you drag them around the shops, not something to order and wait days for when you could nip to the corner shop and back in ten minutes. After the initial novelty value of it being Woolies pic’n’mix, we suspect this little concept is going to fall flat on its face.

But Woolies’ bigger issue, and the spectre that haunted it relentlessly before it folded, other than its poisoning running costs, was that it simply couldn’t compete with the newer and ever-more popular online sellers of books, DVDs, CDs, games, electronics and electrical equipment  - Amazon, Play, and those flashy young upstarts.

They more than often undercut Woolies on price, they were far easier and more enjoyable to use than traipsing up and down soulless neon-lit aisles infested with tantrum-throwing toddlers and bleached-out zombie checkout staff who looked like they wanted to fall through the ground and die, and they could provide a wide range of user reviews – not to mention ranges of different sellers who could offer second-hand versions of products for even lower prices.

But what do we see on the online Woolies? Books, DVDs, CDs, games, electronics and electrical equipment. And mobile phones and computers too, as if it was really going to stand a chance against the Carphone Warehouse, or PC World, who can offer price plans and network provider bundles on top of very competitive prices.

Woolies’ USPs are really floundering here – not only is it falling short on price competitiveness, its delivery dates are looking comparatively sloppy too. Three to five working days delivery for entertainment is just not up there with Play, who can do it in three to four working days (although that depends on the seller), and Amazon, whose sellers can often offer more like one or two working days.

The BBC reported the site's boss, Matthew Hardcastle, said that the online market was competitive - especially for books, CDs and DVDs, and admitted that many of Woolworths' traditional customers may not be regular online shoppers. We suspect he should’ve taken his own advice.

Yes, it’s nice to see a great, longstanding British brand restored. But we really do wonder what the strategic thinking behind all this is. We can only hope that the sales of kidswear and other items in the online shop are prolific enough to keep things going, and that the leeway online selling allows with not having to fill up shelves and stockrooms with forward-thinking huge orders in from suppliers will mean Woolies hasn't spent too much already on buying up items it may well not sell.

But, sadly, we won't be holding our breath.

 

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