Comet pays the price for multichannel shortcomings?

1st Nov 2012

UK electronic retailer Comet, one of the most recognisable names on the high street, is reportedly on the brink of administration, with some 6,000 jobs at risk.

Bought by OpCapita for a mere £2 last year, the company is said to have made a loss of £35m in the year to 30 April, taking it to the brink.

And experts are laying the blame for the retailer's imminent demise at the doorstep of those at Comet that under-estimated the importance of a robust multichannel strategy.

Dan Wagner, CEO and Chairman of Powa Technologies, which is responsible for implementing online and mobile retail platforms for some of the leading high street names, said: “This news really does show the importance of interacting with today’s customers, and what happens when companies don’t pay adequate attention to this.
“The reason Comet finds itself in this position is because it failed to implement a coherent web, ecommerce and mobile strategy. For a store of its stature, Comet was relatively late to the party with regard to online retail, and as it result spent much of its time playing catch-up. The consumer electronics market has been particularly competitive of late, and those who have invested heavily in a multichannel strategy have reaped the rewards.”
Dan Wagner also founded ecommerce giant Venda, the world’s largest independent ecommerce platform turning over $35 million and processing in excess of $4 billion a year in retail transactions. The company is responsible for retail platforms for the likes of Tesco, Orange and Royal Mail.
He continued: “Regardless of size, companies can no longer merely pay lip service to online and mobile commerce, particularly because a greater number of transactions are taking place through these channels. And with the growth in popularity of tablet devices, this will increasingly be the case. The potential demise of Comet is indeed sad news for Britain’s high streets. A keener eye on online shopping would have helped Comet to maintain its favourable position in the marketplace.”
Jeremy Michael, managing director of customer insight agency SMG, adds that the electronic retailer's shortcomings in the online channel have been particularly damaging. However, he believes that the news isn't a death knell for the high street, provided that stores also have a strong online presence.  
“The rumours around the administration of Comet are a sign of the tough times. However, despite the negative news, we can’t see this as defeat for the high street and success for the internet," he explains."The key to a successful e-retail strategy is ensuring that the brand website matches the in-store consumer experience, with both accurately representing the brand’s core values. As online shopping has grown in popularity, many retailers have invested in websites without developing a clear and cohesive omnichannel strategy.
“Establishing a clear brand identity is crucial to establishing a loyal consumer fan base and retaining customers. As the high street evolves, so will consumers, but they will require a consistent brand message across digital and high street platforms. Retailers can then drive sales, improve customer loyalty and successfully navigate the important festive period.”

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