Case Study
Halfords – A Breakthrough in Multi-Channel Retail
Halfords is the UK’s leading specialist retailer for automoti...
Halfords current mix of channels now looks like this:
Stores
466 stores in the UK and Republic of Ireland
More than 40 mil...
Benefits
Halfords believe they have the richest form of truly integrated and
simultaneous multi-channel retail ever, which...
The strategy has had a profound impact on sales:
Traffic from mobile has increased by 248% (2.8m to 9.8m visitors)
in FY12...
Return on Investment
Halfords has enjoyed £20 cash margin for every £1 invested in the
mobile site and apps in the period ...
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Salmon Case Study: Halfords Multichannel eCommerce

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Salmon Case Study: Halfords Multichannel eCommerce

  1. 1. Case Study Halfords – A Breakthrough in Multi-Channel Retail Halfords is the UK’s leading specialist retailer for automotive parts and accessories, cycling and leisure. Salmon have been helping Halfords implement their multi-channel strategy since 2005. Responsible for designing, developing, integrating and supporting the various solutions that optimise the Halfords shopping experience across store, web and mobile. Challenge Historically Halfords did what most other retailers do when it comes to multi-channel retail, they offered customers an in-store shopping experience OR an eCommerce experience. This single channel approach meant that Halfords main differentiators, their helpful store colleagues and well-stocked stores, were not there to close the deal. Consumers like to interact with Halfords products, and discuss them with shop assistants. Whether a bike, a car seat or just a windscreen wiper, in fact, for every pound spent online, ten pounds is spent in-store by people who clearly need the store experience that is Halfords competitive advantage. Solution Salmon worked with Halfords to offer a hybrid solution, Reserve and Collect; all the benefits of online shopping including product guides, customer ratings, selection tools, videos, plus the benefit of being able to save on delivery costs, and the convenience of store collection with Halfords benefiting from additional sales of accessories in store. This was a great success, driving an increase in web customers visiting Halfords stores and Reserve and Collect accounting for 81% of online sales. Customers now had the best of both worlds. The value and choice of a great website, plus the physical interactons of a great retail environment, one enriching the other. In August 2010 Salmon enhanced Halfords existing commerce infrastructure to launch a mobile optimised website, a first for a non clothing brand. The mobile site was so successful that Halfords saw an immediate 200-300% growth in website traffic to the mobile site. Halfords were one of the first mass UK retailers to offer PayPal as a mobile payment method, allowing customers to choose to pay by credit/debit card or PayPal. Great! (v1.2) by anon Easy to use. The store locator was particularly useful when I was stuck somewhere in London needing wiper blades! Very helpful, very convenient.
  2. 2. Halfords current mix of channels now looks like this: Stores 466 stores in the UK and Republic of Ireland More than 40 million store visits/year Over 9,300 employees Over 14,400 in-store product lines (Over 400,000 available to order) Fitting and repair services carried out in-store by trained staff Online 43 million visitors (year to March 2012) Web traffic is growing at an annual rate of over 10% Online sales currently (FY12) represent approximately 9.0% of Halfords retail sales Reserve and Collect and Free Delivery to Store, Home and Work delivery 81% of online sales come through Reserve and Collect (as outlined above) Mobile Mobile-optimised website Text and Reserve, Reserve and Collect, Free Delivery to Store iPhone/Android apps Accounts for 17% of online traffic and 12% of orders (by value) Since launching the mobile site, conversion has doubled and traffic has grown at almost 250% In June 2011 Salmon developed iPhone and Android apps for Halfords enabling customers to: Find a shop using GPS, check opening hours, access store pages for every UK store, access comprehensive advice centres and ring the store if necessary. Scan in-store barcodes, accessing additional product information that previously only online shoppers could enjoy, like detailed product specification, related accessories, customer reviews and informative videos. Scan in point-of-sale QR codes to access more advanced product selection guides, like entering your car registration number to see which oil you should buy. Order items for home, work or store delivery as well as Reserve and Collect. Excellent (v1.2) by Goonerstar A fantastic app that’s easy to use and gives you all the info you could need to shop at Halfords. The camera scan is an excellent addition Useful (v1.2) by Cameron Cornish Useful app, very easy to get to the stores opening times Helpful (v1.2) by GingerAndy Great app, simple to use!! Halfords did well here as always!!
  3. 3. Benefits Halfords believe they have the richest form of truly integrated and simultaneous multi-channel retail ever, which is already being enjoyed by over 60,000 people who have downloaded the apps to date. The app has earned an average three star rating (the average is 2.7 for retailers) with numerous five star ratings and comments including “A fantastic app”, “This app is brilliant” and “Very helpful, very convenient”. Halfords staff are also enjoying the apps. Store managers have reported that their staff use the apps to support face-to-face discussions with customers, providing critical information they may not know off the top of their heads. A completely unexpected positive by-product. Improved Customer Experience Customers can now mix and match the best of eCommerce and retail like never before. For example: Nipping out in the lunch break, trying out all the bikes until they choose one they like, and then scanning in the code and ordering it for delivery to their home address. Ordering a car bulb online, and then driving to the store to have it fitted. Ordering a product not stocked in their local store and having it fitted when they collect. Smartphone owners can now access the depth of product information and selection tools normally only enjoyed by online users, with the scan of a barcode, including: Customer ratings and reviews Product videos Product and price comparisons Stock availability Buy or reserve Interactive tools that identify vehicles from their registration plate and then recommend the right product for that specific model Transactional texts (opted into by over 90% of customers)
  4. 4. The strategy has had a profound impact on sales: Traffic from mobile has increased by 248% (2.8m to 9.8m visitors) in FY12 Multi-channel revenues have grown from £19.4m in 2008 to 70.1m in 2011 (year-on-year growth has been +36.4%, way ahead of the industry average of 19.9%). New functionality encourages cross-and up-sell Year on year Halfords has seen a ten point increase in their Net Promoter Score, largely because of a substantial (ten point) increase in the number of people citing “ease of shopping experience” as their reasons for giving a high score. This has helped Halfords grow its revenues by 4.6% for the year ending March 2011, now totalling £869,700,000. Growth in multichannel in 2011 The following graphs show 2011 has seen substantial growth in multichannel sales and online customers visiting stores: Multichannel Revenue Growth +36.4% +36.4% +37.1% +93.3% £70.1m £51.4m £37.5m £19.4m 2008 2009 2010 2011 9.2%6.4%4.67%2.43%1.17% 85%77%74%54%n/a During FY11 online sales rose by 36.4% to £70.1m The Order & Collect service has driven a 5.3% increase in web customers visiting stores 20112010200920082007
  5. 5. Return on Investment Halfords has enjoyed £20 cash margin for every £1 invested in the mobile site and apps in the period since it launched in August 2010, meaning an ROI of 20:1. Halfords approach has been so successful that they are continuing to invest heavily in an evolving multi-channel development strategy with increased focus on mobile, including: Further communication of mobile capabilities in-store QR code tracking for in-store mobile optimisation Personalisation and re-targeting using IBM Coremetrics and Criteo Tablet optimisation: ensuring the app detects the device and so tablets and smartphones get suitable sites About Salmon Salmon is a highly innovative global systems integrator whose commitment to on-time, on-budget projects is increasingly embraced by the leading names in retail, insurance and financial services markets. Since 1989, leading brands have been turning to Salmon for its ability to build, integrate and support business-led systems that add measurable competitive value to their day-to-day operations – and to their bottom line. Salmon quickly understand business needs, creates realistic development schedules, and efficiently delivers solutions to plan; based around an ethos that marries a depth and breadth of development skills, with a management process that removes virtually all risk from successful project roll-outs. Customers include Argos, Boots, Bristol & West, Halfords, Novae, Swiss Re and W.R. Berkley. Salmon is headquartered in Watford, Hertfordshire and has offices in the US, China and Australia. For more details about Salmon visit www.salmon.com. Salmon Limited 64 Clarendon Road • Watford • Herts • WD17 1DA Tel: +44 (0)1923 320000 • Fax: +44 (0)1923 320023 • Email: info@salmon.com www.salmon.com *All rights reserved. All company and product names, brands and symbols mentioned herein are brand names and/or registered trademarks of their respective owners.

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