IN-DEPTH Wiggle and Chain Reaction Cycles: iteration and international growth

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IN-DEPTH Wiggle and Chain Reaction Cycles: iteration and international growth

31 August 2018 by Christian Annesley

 

Growth is a constant for successful, internationally minded retailers, but the question of how to approach that growth never goes away. Retail’s complexity and the long list of potential country markets where there’s a chance to work harder and do more sees to that.

 

For the cycle-run-swim business WiggleCRC, in 2016 the question of international expansion got even more complicated with Wiggle’s merger with cycling-focused Chain Reaction Cycles. Why complicated? Because it doubled in an instant the number of opportunities in country markets that needed dedicated attention.

 

How has Geoff Bull, the group’s head of digital marketing, navigated that challenge? “One of the points of the merger lay in the symmetry between the businesses,” Bull told delegates at IRX 2018. “Even as they came together, both businesses generated less than half of revenues in the UK and actively marketed in 20 countries – broadly the same 20, too.

 

“On one level, that’s a great platform, but it still leaves a huge amount to think about. Wiggle has 14 versions of its website for different markets, while CRC has nine different skins for its site. The focus on opportunities is different, too.”

 

EASY AND HARD

So far, so complicated – but the essential point that going international as a retailer in this online age is easier than ever before in history holds good. And it’s why both sides of the business already had such an international focus.

 

The question, says Bull, is how you methodically approach all the daily challenges that arise when selling into different markets. “There are hundreds of variables to consider, so you need a way of prioritising that you can trust,” he noted. “The internet has been a great enabler by reducing the barriers to entry into markets, and reconfiguring the value chain, but it has also increased competition. Customers are price-sensitive and will go elsewhere if there is any friction in a would-be purchase.”

 

What WiggleCRC has on its side for international sales, besides functioning market-ready websites, is how it sells non-perishable goods that can ship worldwide and in a realtively easy regulatory framework: “That big picture is ideal, clearly. It means there are low marginal costs to enter a new market. But as soon as you start working at growing in a particular market there are decisions to take – and you need some methodologies to proceed.”

 

LEAN AND AGILE

Bull highlights how agile and lean start-up methods like those set out in Running Lean can help with iterating towards approaches that solve customer problems in particular markets, with the added benefit that those same methodologies can often map to software development tasks in parallel.

 

“To guide us through the problem/solution process, we use a decision tree to explore potential solutions. When you are faced with lots of opportunities and choices, you need these routes through decision-making to take action with confidence.”

 

RETENTION AND FOCUS

For example, the marketing team might ask itself what drives loyalty and purchase behaviours in a particular market, and identify how reduced friction and a great experience plays its part, as does some extra thought and attention to the detail of the experience to make someone feel extra-special. Incentives also help, of course.

 

“From here, we’ll get more granular, looking at the role played by help and advice, speed of delivery, cost of delivery and customer service, say, towards delivering a good experience,” Bull noted. “The point is that by embracing a process like this we find subtle differences need to be made in each market – differences we would miss if we didn’t have a method and a means of scoring and weighing our choices.”

 

Working effectively with an offer in a country market isn’t just about refining your processes and proposition, of course, but also involves making bigger investment decisions that might aim to open up new opportunities. Here, Bull was clear that the financial overheads are fundamental and can’t be ignored: “If you are trying to rank opportunities, the cost of doing business counts. Asia might represent a big opportunity, but you cannot escape how it’s a long way away compared with Ireland – and comes with extra overheads to deliver against language needs next to Ireland, as well. So those trade-offs play a big part in the calls that get taken.”

 

Bull concluded by emphasising how the whole process around international trading is defined by trade-offs – that is, what’s doable technically set against various commercial and practical realities, and the possible upside involved: “But it’s through testing around your trade-off decisions that you can start to build a picture of your optimisation priorities – whether those are in data, payment, pricing, customer services, marketing, translation or delivery. In each country market, the priority list will shift around all the time, and look different to other places, too, but the work still has to be done – and keep being done. In fact, I would have to say this commitment to an iterative method is nothing less than essential. It’s what keeps the business relevant and customer sales strong.”

 

This feature first appeared in the IREU Strategy & Innovation Performance Dimension Report. Click here to explore the Top500 series further.

 

Image: Fotolia

Original source: InternetRetailing

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