Cook acts after Browett upsets the Apple cart with half-baked retail recipe

October 30, 2012

The surprise is not that John Browett, former Dixons CEO and Tesco high-flier, quit Apple after only 6 months. The surprise is he wasn’t fired earlier: or indeed that he was hired at all.

Not that there’s anything wrong with Browett’s retail skills, in their place. Which is, or was, running a British high street retailer; not at the helm of the retail arm of a global corporation fanatically dedicated to innovative product launches and superior customer service.

The announcement of Browett’s departure, which coincides with – but is only tangentially connected to – the sacrificial dispatch of Scott Forstall, head of iPhone software (for the horlicks he made of the new Maps app), has been greeted with widespread “told-you-so” cynicism. And nowhere more articulately than in the comments section of The Telegraph online.

My own favourite? Quote from Mr Cook : ‘Mr Browett had a commitment to customer service “like no one else we’ve met.” ‘ Similar to Morecambe and Wise writing: ‘We shall tell all our friends’ in the visitors’ book at a particularly awful Blackpool b&b.

Quite. The fault lies not so much with Browett (who is in any case going to walk away with much of his £36m golden hello intact) for initiating ‘pile it high and flog it cheap’ tactics – the only thing he knows – but with Apple’s chief executive Tim Cook. Whatever was he thinking of when he made the appointment late last year? Browett is the complete antithesis of everything Apple stands for.

It’s not about command-and-control retail structures where costs are minutely controlled. It is about money-being-no-object where customer service is concerned. It’s also about silo’ed autonomy, something alien to Browett’s own retail culture.

Cook can chalk this one down to inexperience. But it does make you wonder whether he’s got a sufficient measure of the “vision thing”.

HMV outfoxed by Dixons recovery story

January 6, 2011

It’s probably just as well I can’t remember the name of the national newspaper pundit who, only the other day, tipped high street retailer HMV Group as one of the hot recovery plays for 2011. Yesterday, its already severely mauled share price – down 80% in the last year – lost a fifth of its value on news that like-for-like sales over Christmas had been abysmal, and that the company was going to have to sell off 60 of its stores as a result. Not that I had invested. If I were to take a punt in this sector (which I’m not), I would select Dixons – which has some interesting parallels to HMV. But more of that later.

Simon Fox, HMV’s dynamic chief executive, started out in 2006 as a latter-day Prometheus; now he resembles nobody so much as Icarus. HMV has pleaded it had an awful end to the season (which it did). But then, so did everyone else, and look what that didn’t do to John Lewis sales over Christmas. Behind mitigating excuses lies an increasingly sad reality: HMV’s visionary strategy for coping with drastic structural change brought about by the internet has failed.

“Sad” because if anyone was equipped to bring off mission near-impossible at HMV, it was Comet-bred Fox. Fox has shown a gamut of qualities infrequently found in one chief executive: drive and leadership (of course), imagination, flair, tenacity. It’s not as if he hasn’t had some decent job offers along the way, too. The stewardship of ITV – we now know – was not the nightmare it then appeared, and helming the media company’s turnaround would have brought recognition and reward far in excess of anything Fox could ever earn at HMV. So, to that list of qualities we should perhaps add loyalty.

Unfortunately, the feat at HMV seems to have been superhuman – beyond even the powers of a demi-divine titan. In the bid to address the classic “clicks and bricks” dilemma facing legacy high street retailers – particularly those involved in the technology and entertainment sectors – Fox has scored highly rebranding HMV as an online brand, but stumbled on one of the basic precepts of his trade: retail is detail.

We can admire the strategic vision of recasting the core gaming and DVD area – together with a new co-venture into cinemas – as ‘screen-based entertainment’. We can appreciate the imaginative logic of introducing fashion lines into the high street offer. We can even sympathise with Fox over the catastrophic decline in CD and album sales generally – which has far outpaced predictions. But, oh dear, what about customer service? Judging from online commentary, not from the commentariat but the general public, HMV has become a byword for ignorant, unhelpful, under-manned and under-managed frontline staff. Only in part is this down to cost-saving retrenchment, which has squeezed numbers and forced out experienced (and therefore more expensive) sales people. Oddly, this shortcoming seems to apply only to the HMV arm of the group. At Waterstone’s – similarly ill-favoured by the e-commerce revolution – the lesson has been learnt that solicitous attention to customer needs is an integral element of post-digital survival in the high street. No coincidence, perhaps, that the book shops have weathered last year’s turbulent conditions rather better than the music and DVD side.

It’s not something that has gone unnoticed at Dixons – not so long ago the uncontested winner of the wooden spoon award for customer service. Like Fox, Dixons’s chief executive John Browett is a retail high-flier. His previous employer Tesco – which he left in 2007 – valued him so highly it would not let him stop working a day before his gardening leave was completed. In some ways, Dixons (then DSG) was in more of a mess than HMV Group when Browett joined. In a knee-jerk reaction to the internet, it had unwisely relegated the historic Dixons brand to an online presence (airports excepted) and confused the high street offer with a rebrand. Browett has managed to unwind most of this, regrouped the Currys and PC World brands under the Dixons monicker, streamlined the consumer electronics offer (with such rabbits out of the hat as an exclusive distribution deal with Apple over the iPad launch) and, most importantly, perhaps, embarked upon a massive staff retraining exercise. Halfway through his four-year turnaround programme, Dixons appears to be heading for a profit. We’ll have to see whether Browett maintains the momentum in 2011. But from the present vantage point, Dixons appears a much better recovery play than HMV Group.

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