Matt Henderson, co-founder, Rangespan
1. What is the greatest opportunity for your business?
Predicting the future, specifically we predict which products will succeed online and which won’t out of the 200 million unique products available on the internet. To do this across such a wide range we need to track and make sense of a range of data that tests the latest technologies and mathematical methods. It’s a huge opportunity because retailers waste billions of pounds each year on carrying the products that customers don’t want and not carrying some products that customers do want. Our predictions are getting very accurate and it is super exciting seeing how retailers apply that insight to their business.
2. What is the biggest challenge to your business?
Inertia is the main challenge. As a sector retail has a high focus on current operations and not a lot of time or money left over to consider building future processes. This makes change slow. Retail is becoming a technology industry where more and more of the processes could be made more effective through the use of technology. This means that retailers with a high capacity for change and technological innovation are leaping ahead while the others, the slow changing ones, are getting left behind.
3. With the benefit of hindsight what would you have done differently so far?
In my career I’d have embraced technology earlier. I’d have dived into the strategy and detail of what’s possible with software earlier. At Amazon I learnt about this and now I realise that developing your own direct skills in technology at even a basic level helps you to understand what engineers and data scientists can do. This marks you out as a 21st century leader. At Rangespan this has manifested itself in a mandate that all our employees learn SQL. This has led to innovations and automation from all parts of the team that we wouldn’t have otherwise got.
4. What is the future of the physical store?
Vertically integrated brands will occupy a higher proportion of the High St than they do today. For example, Ralph Lauren and Marks & Spencer are more insulated from price competition than those retailers who only stock other manufacturers’ products. These latter retailers will decline as a percentage of the high street. There will also be more products being sold with services around them rather than just single-time transactions.
5. What will the high street look like in a decade?
We’ll see lockers as they are a space efficient way for click & collect services and are also time efficient for customers to use. There will also be plenty of co-location whereby some stores will only be in a physical space for certain times of the year. This will lead to more of a blurring between pop-ups and fixed stores. There will be more of the concept of showrooms and stores will be used by brands to embody their brand identity, with the brand thinking of the rent and rates costs as part of their marketing budget.
6. Will mobile devices be the primary sales channel in the future?
Electronic will be the primary sales channel but will it be mobile? It depends how you define it. There will be a continuum from small devices to desktops and they will all be used by shoppers. Electronic commerce will grow until it is the primary channel overall, and even in categories where it less than 50% of sales are over electronic devices, you can be sure that more than 50% of the research will be done electronically.
7. What other retail business do you admire?
One is Zalando – for its speed of growth and the scale of its ambition. I also admire AO.com because they are one example of several retailers who have out-Amazoned Amazon in certain categories. AO.com has brought personality to a bland category and now has an unassailable lead in a category where economies of scale count for a lot. Tiger is another great business that adds a touch of whimsy into the everyday, which is hard to do. M&S’ problems are partly down to it not being able to imbue its products with whimsy.
8. If you hadn’t been a retailer/service-provider-to-retail what would you have liked to do?
Architect, because you have a concrete output, or a civil engineer. I like industries where you can look back on a year and see what you and your colleagues have been able to build.
9. What marks out of 10 do you give yourself so far for achievement?
Five, as I have set a high bar. I’ve worked with some great people, there have been some good financial outcomes, and I’m proud of what has been done but I’m hungry to do more and for Rangespan to do more. As Jeff Bezos would say, ‘it’s still day one’.
10. Who would you place in the Top 20 Multi-channel/e-commerce Movers & Shakers?
Chris North, UK MD at Amazon is very impressive. He’s very smart, fast and decisive. And including marketplace sales Amazon UK must be over £6 billion in annual sales by now, so love them or hate them, they are the biggest online retailer by a long shot. Nick Robertson of ASOS would be the other obvious top dog.