February 19, 2011

Talk with retail designer legend Rodney Fitch

Rodney Fitch (photo: EHI)
Rodney Fitch: A legendary retail design pioneer
Tesco more trustworthy than the Bank of England? Aldi, Germany's most revered food retailer, not trusted in the UK?!

These are just some of the controversial opinions stridently voiced by international design guru Professor Rodney Fitch.

Like Dr. Johnson, Rodney Fitch (72) is both a good friend and a good hater.

Many in the trade speak well of him, but those who have felt the lash of his eloquent tongue are not likely to forget the experience.

His comments on Neal Lawson, the left-wing retail critic and author of "All Consuming", are not for the faint-hearted.

This very characteristic is a great boon to the interviewer. Fitch never pulls his punches and is as verbally entertaining as he is astute. In fact, his so-called "Rodney-isms" have become almost legendary in Anglo-Saxon business circles.

Enfant terrible with CBE

Although he now carries a CBE after his name, Rodney Fitch was always something of an enfant terrible for the British Establishment. As early as the 1950s, we find him involved in the campaign for nuclear disarmament. This conjures up a delightful vision of him marching arm in arm with Bertrand Russell waiving a "Ban the Bomb" placard in London's Trafalgar Square.

Since this time, Rodney Fitch has consistently re-invented himself. Perhaps his greatest creation, however, was to found Fitch in 1972 which later became the first design company to go public on the London stock exchange.

Past colleagues, such as Clive Woodger, who worked closely with Rodney at Fitch in the 1980s, remember him fondly as a "great communicator to clients" and as "a manager who attracted a wide range of talented people".

Design as strategic factor

Fitch was also largely responsible for the massive growth of design as a key strategic retail factor in the 80s. Fitch clients have included such stalwarts as Marks & Spencer, Best Buy, Ikea or Tesco. With interludes, Rodney Fitch was connected with the company he founded (now a part of Sir Martin Sorrell's WPP empire) for nearly 40 years.

In 2009 he relinquished his position as Chairman to take up a professorship of Retail Design at Delft University in the Netherlands; Fitch also lectures at Mumbai university. Woe betide those MBA students who have not heard of his Victorian favourite, William Morris!

Beyond these academic commitments, Rodney Fitch remains one of the great inspirers and ambassadors for design.

INTERVIEW


Professor Fitch, if you had to name one key cultural trend which will influence shopping in the future, what would it be?


The key issue for all retailers in the future will be the point of view of the citizen consumer. By this I mean the redefinition of value, a rediscovery of trust, as well as an expectation of honesty, integrity and authenticity.

Doesn’t virtually every retailer claim this for himself?

The fact is that one retailer says “Trust me!”, and another one says the same thing, but shoppers trust the one and don’t trust the other. Why do people trust Tesco and not trust Aldi UK? They are in the same business, but one is more trusted than the other.

Could you be more specific?

Back in 2008, I organised some consumer research into the issues of trust and authenticity, this was at the height of the financial crisis. We found that the most trusted institution in Britain was Tesco -- more than the government, the opposition, the Bank of England, the big banks or even neutral advisory services such as the Citizens Advice Bureau.

Why do you think that Tesco has such a high trust rating?

It has to do with the way they position themselves and conduct their business around “we are always there for you”.

Your findings are astonishing from a German point of view because Aldi enjoys a tremendous amount of trust in its home country…

I only have a view about Aldi in the UK. When the financial crisis first appeared, the impression in the market place was that they were simply capitalising on the financial crisis and exploiting it for their own ends; they came across over here as advantage takers.

Why then did Aldi UK boom in the recession?

It is significant that Aldi fell through the floor as soon as the pressure was off. They didn’t build any trust when they had every opportunity to do so; they simply built more Aldi stores. All they did was exploit the circumstances, and you had this uncomfortable image of some fat grocer sitting behind a desk rubbing his hands in glee at the discomfiture of the customers.

But didn’t Tesco, Sainsbury and Waitrose also profit from the crisis by introducing and/or expanding their budget lines?

Yes, but unlike Aldi, these reactions came across as helpful in making available cheaper products.  One of the very smart things which Tesco and particularly Waitrose did was to infer that they were not going to reduce quality anywhere, whether in store fixtures or fresh produce.

Instead, Waitrose, our higher end grocer, introduced 1,000 products and put them out as value lines in order to deliver cheaper but ‘Waitrose quality’ products to their suffering customers.

If Aldi offered you a consultancy contract, how would you help them to seem more sincere and caring in the eyes of the UK consumer?

Your mythical consultancy would have a many-facetted task. It has something to do with the product offer. I also think they need to do something with their stores and their fresh produce.

Above all, I don’t think they communicate well enough. They have no “higher purpose” – only cheapness and, even in these value-driven times, that is not enough since there is much more to value than price.

Aldi would argue that the best form of communication is low prices…

They lack a unified communications programme and use very, very poor language to express any authenticity, sincerity and integrity -- our higher purpose.

Do you see any further challenges facing mass retailers beyond the central issue of sincerity, integrity and trust?

I am constantly astonished how little effort mass market grocers put into differentiating between the genders. Men and women shop entirely differently; it’s in our DNA, men are still hunters and women gatherers.

Aren’t you just regurgitating a myth?

Plenty of research, yet alone experience, demonstrates that men want to move around a store as quickly as possible and women do not. So, a man who goes into a store with his wife becomes a burden, and a man who goes into a store on his own is seldom catered for.

What then would you suggest? Would you copy Cora’s experiments with gender marketing in France where it devotes whole parts of its hypermarkets exclusively to women?

Regardless of whether this is a good or a bad idea; at least they are attempting to accept the facts of shopping life.

But is it a good or a bad idea?

Cora may well find that more women shop in the “male” parts of the store because women also have a masculine side and often shop for men. That said; it is not a question of making one part for men and one part for women. It’s about making store navigation and the customer journey appropriate for each individual customer.

Why do you think that most retailers have put so little thought into tailoring their stores to meet the expectations of specific customer segments?

A retailer who really loved his customer would be customer-oriented rather than supplier-oriented. Regrettably, most retailers are supplier-oriented. Instead of thinking about the expectations, hopes and fears of their customers, many just think about the trolley as it goes around the aisles and plan the store from a “trade” point of view rather than a “customer journey!”

How can retailers improve their offer to cater more effectively for specific customer segments in often large and complex catchment areas?

The key is surely customer information. One of the reasons Tesco is the most innovative retailer is because of its customer knowledge. Through its loyalty cards it knows so much about its customers that it is able to locally tailor its stores in terms of size, layout, consumer information, product categories and service etc.

What will be the mass retail format of the future? Or will it all be channel blurring?

The genuine beauty of retailing is firstly that one size does not fit all and secondly that there is room for everything. I don’t see that there is just one format of the future, the key to success lies elsewhere. Let me give you a “Rodney-ism”: no retail format can be successful unless it meets the expectations of the society that it serves.

How far should retailers go when meeting the expectations of society? Should they, for instance, provide “retailtainment”?

It depends on the consumer culture. In Asian hypermarkets and shopping centres the entertainment value is often as important as the shopping component.

That’s not the case in Britain; people do stay in the better shopping centres for a little while after they have completed their purchases, but they soon go home. In, for instance, Singapore or Bangkok, however, they might spend the whole day in the shopping centre.

O.K., but should retailers aim to be a social hub within the community, or should they stick to what they do best, i.e., selling products?

I don’t believe gluing a community together is the essential role of the retailer. In Japan, due to space shortage, much of its shopping was and is vertical. On the top floors of department stores you can find schools, conferences rooms, training classes, yoga and cookery classes, baby care etc.

However, seen from a western perspective, I regard them essentially as an add-on, and they won’t persuade anyone to buy more biscuits.

How then can the mass market retailer create a shopping experience with a “boomerang effect”?

Another Rodney-ism: “Only one retailer can ever be the cheapest,” in the same way that there can only ever be one tallest or shortest person.

If you are the cheapest retailer, that may be reason enough for your boomerang effect, i.e., I will always go back there because I know that it will always be the cheapest. Every other retailer then has got to do something else -- be it through design, promotion, NPD etc.

In other words, retailers must build something unique into their positioning which will always draw the customer back?

This is particularly important in today’s world where mobility and the internet have made shoppers less brand loyal and more promiscuous in their shopping.

Won’t customers simply always search for the lowest price online?

No, for instance, I will always buy my white goods and many other big ticket items from John Lewis because of the service quality. I will always go back to them rather than searching the internet for something cheaper. And there are plenty of successful online retailers whose prices are far from being the lowest available.

Will stores still be needed in 2020?

I think one of the really big challenges is how physical retailers will also become online retailers without losing business. Retailing is a kind of zero-sum game. Let us make the assumption that 35 per cent of all retail sales in the year 2025 will be online. Now, what does, for instance, Metro Group do about that?

Yes, what is Metro going to do about that?

Obviously, just building a website won’t compensate losing 35 per cent of the sales from your physical stores and winning this volume from the competition is not viable. So you have to fill this hole with an online offer that is seamless.

The brand positioning, both online and in-store, has to be seamless; the service quality and the service design need to be common; it should be as easy to navigate a store as it is to navigate your website and vice versa.

You have to get your supply chain and your price points in line. You have also got to be very clear about what you can do well online and what you can’t, and then make a virtue of both.

To conclude with a question particularly relevant to the recent festive season: Could retailers do more to help us eat more sensibly?

I think it is very interesting that you pose such a question because I think it is a very statist one. What the hell has it got to do with a retailer that you eat too much? That’s your problem, not the retailer’s!

In our western society retailers are the whipping boys. Because they happen to sell donuts they are accused of fattening the nation. That is totally unfair. Retailers have become easy targets for bureaucratic and incompetent politicians and a lack of consumer discipline.

But doesn’t the State have to foot the bill for the health consequences of obesity? Why can’t it appeal to retailers to market healthier foods?

Retailers have a long-term interest in healthy customers.  But the State’s role is to educate the people, provide security and defence of the nation etc. A retailer’s job is to make available to the population as wide a choice in as many varieties and at as many price points as possible.

If that means donuts with pink, green and brown toppings, so be it, that’s democracy. In fact, retailing is the greatest and only true democracy in the world there so that citizen consumers can make their own democratic choices. It is certainly not democracy to say that no one can sell donuts because all you people out there are getting fat.

 
Related article in German: Interview by Mike Dawson in Lebensmittel Zeitung, no. 5, 04.02.2011


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