Movers & Shakers Q&A: John Roberts, CEO, AO World

 

John Roberts, CEO, AO World

Where did it all begin? John Roberts is resolutely from Bolton and is usually characterised in the press as either a “no-nonsense” or “loud-mouth” Northerner. He still lives in Bolton with his family comprising wife and their five children, some of whom are grown up and some of whom are still in junior school.

First proper job? Well he’s not known as the ‘kitchen king’ for nothing. Moben Kitchens was the place where the young Roberts first encountered white goods and rose to be head salesman. And it was also the place where he got fed up with incredibly long and convoluted supply chain that existed between customer and manufacturer in this sector. However, at around the same time the internet started to be a thing.

So to AO.com. When did that all kick off? Picture if you will this scene. John Roberts sitting in the pub with his friend. Famously that friend bets him a £1 that all his talk of selling directly to the consumer and undercutting the retailers like Currys through the internet amounts to nothing but hot air. Bet is taken. Appliances Online is formed.

Challenges – there’ve been a few… cash flow in the early days was most definitely an issue for Roberts, especially as his strategy was primarily to massively take the business away from Currys et al through low prices. He has described telling people in the office to make lots of noise in the beginning so that when people rang up it sounded like a hive of prosperous activity.

Until the part where: He understood that the way forward was to make the primary focus service levels instead. He realised that people got very frustrated with deliveries not turning up, parts being delayed, not knowing where to get the right and trusted engineer from and so AO.com, as it became, developed a reputation under Roberts’ watch of a really high-class service ethos whatever the value of the goods bought which it has retained through thick and thin. 100,000 reviews on Trust Pilot can’t be wrong.

Next challenge: Almost inevitably as the company made more and more money, thoughts turned to an IPO. But Roberts is probably not the person best equipped to deal with the city where it is fair to say he may have rubbed people up the wrong way. But the IPO itself was a resounding success on day one and made Roberts a fortune on the spot – none of which his children are destined to see. But that’s another story…

And then: And then it seemed for a period as though his brand of full-on, enthusiastic, hands-on management wasn’t quite what the company needed. Only one year after the IPO the company issued a profits warning while Roberts became increasingly frustrated with unforgiving shareholders and the tendency of the press to focus only on profits and ignore any bigger picture of investment.

So what did he do: Left the CEO position. In 2017 he handed the role over to his close AO associate Steve Caunce who had joined the business in 2005, who he said was effectively running the day to day business anyway. Less showy, less mouthy but an expert pair of hands to oversee foreign expansion. However after a hiatus of only two years John Roberts returned in January of 2019 to the role. Just after AO reported a first half loss but just in time for a resurgent trading statement which put revenue up 8.2% after a blinding Black Friday season.

Where are the opportunities for him now? Today Europe. Tomorrow the world! Seriously though AO are now in the Netherlands and Germany and focussing very much on being the leading European electrical retailer. Of course, he will always have to navigate the fact that white goods purchasing is heavily connected with the housing market which is currently stagnant. And that most of his goods are imported from the EU making it a costly affair right now. But in leadership terms he has said that he is now more respectful of his impact on the business and doesn’t go charging in with loads of impossible ideas but rather asks how he can be helpful to people.

So what’s the next step in plan Roberts? It’s only been seven or eight months since, it is fair to say, the business world was genuinely stunned by news of his return as CEO and Caunce’s step back. But what AO needs now is loud and proud brand awareness in lots of emerging markets and Roberts is surely the man for that. Added to this it looks like he has plans to do to the mobile phone shops what he did to Currys and Dixons – AO Mobile launched in August and they are also in the vanguard of the white goods rental movement. You just can’t keep a good entrepreneur down.

Defining quote 1 on being in charge again: “There’s nothing quite like being right at the cut and thrust. It’s a class A drug all of its own”.

Defining quote 2 on the IPO: “Would we do it again? Yes, but I would probably have got a slightly bigger flak jacket”.