UK retailer Sainsburys will open a pair of e-commerce research centers
May 12, 2015 04:38 PM
It’s been a busy couple of months for new e-commerce business initiatives at Sainburys, one of the biggest general merchandise retailers and grocers in the United Kingdom.
Late last week on its preliminary year-end earnings call, Sainburys, No. 14 in Internet Retailer’s 2014 Europe 500 announced it was aggressively moving ahead with plans to build and staff an e-commerce technology and digital marketing research center in Coventry, Great Britain’s tenth-largest city, and open a digital innovation laboratory in London.
Though Sainsburys has yet to say when the center will open, construction is under way on the Coventry facility. Sainsburys plans to hire hundreds more web site designers, programmers, digital marketing specialists and other e-commerce-related workers for the two e-commerce research facilities.
“We’ll be investing in a digital hub and we’re anticipating recruiting 480 people over the next period of time focused on improving our digital capability,” Sainsburys CEO Mike Coupe told analysts, according to a transcript from SeekingAlpha.com. “Over the medium to long term, that’s one of the areas that can significantly improve our offering and overall differentiate relative to our competition.”
Sainsburys isn’t saying how much it is spending on opening its new e-commerce research centers. But Sainsburys joins a number of retailing companies in the U.S. that also have opened and are staffing online retailing and e-commerce research centers. They include Walmart.com, No. 3 in the Internet Retailer 2015 Top 500 Guide, Staples Inc. (No. 4) and Sears Holdings Corp. (No. 5). Staples opened its center in 2012, the same year as Sears. Walmart.com created its @WalmartLabs e-commerce research center in Silicon Valley in 2011 after acquiring Kosmix, a technology start-up that focused on social media and mobile commerce.
When open, the Sainburys e-commerce centers will focus on devising new site features and functions such as more advanced and quicker buy online, pick up in stores features, which U.K. and European retailers refer to as click and collect. The center also will develop newer versions of mobile apps with improved features for letting shoppers create a shopping list at home, locate and reorder favorite items, find products in stores and scan price checks.
“The shape of our business is changing and digital and technology is a core part of our future growth,” Coupe said. “Ultimately these changes are good news for customers, and experts in our digital lab will be developing new ways of digital shopping to give customers the best access to our products, services and offers.”
Sainsburys also in March rolled our click-and-collect services to 20 stores across Great Britain with a total of 100 stores scheduled to be offering the service by the end of year. Sainsburys operates a network of 1,200 stores. “We’ll start trialing click and collect in different locations,” Coupe told analysts. “So as well as in our large out-of-town super stores over the next period of time, we’ll also try click and collect on some convenience sites where we’ve got car parks, which again opens up the online offer to more of our customers.”
Sainsburys will release full financial results including for e-commerce next month but for the 2015 fiscal year ended March 14 reported:
- Online sales grew 7% but the merchant didn’t break out specifics.
- Total sales declined 0.9% to 26.12 billion pounds ($40.43 billion) from 26.35 billion pounds ($40.79 billion) in fiscal 2014.
- Net loss was 166 million pounds ($257 million) compared with net income of 716 million pounds ($1.10 billion) in the prior year.