Mark Hodgkinson, marketing and e-commerce director for HMV, talks to Helen French about making the most of a connected customer base and the Christmas sales...
HMV has been working towards becoming more of a technology retailer - is that still ongoing?
Yes – the area of technology where we believe we can make a difference is in what we call portable entertainment devices. If you look at the direction that entertainment is moving in, more of it is experienced through portable gadgets now. In the past you were accessing entertainment with CDs and DVDs, but increasingly it is through your tablet or your smart device.
If you’re looking at the entertainment that you are very well known for selling, such as music and movies, it’s being sold directly on those devices now, so it makes sense to sell the devices…
Exactly. If we want to stay at the heart of entertainment and be the specialist entertainment retailer then this is the direction that makes sense for us.
Is there a need to re-educate the consumer that they can come to you for gadgets now?
That’s the important thing. Some of the work that we need to do is about making it clear that that’s where we’ve gone and that’s where we’re heading.
The majority of people know we sell music and film. But when it comes to technology and games the levels of awareness are much lower.
What we’ll be doing at Christmas is clearly signposting the entertainment devices we sell to the customers, through our windows, in all our marketing, through POS, adverts – showing that we can meet all your entertainment needs.
Christmas should be a good test. Your sales for that period always come under examination, and yet technology is usually a good performer for you then.
It is, and tablet growth has been a phenomenon. We’ve been one of the few retailers with the Google Nexus, for example, and we’ve sold out of our first allocation for that. We know there’s demand there, and now we have to drive awareness.
Is part of that refreshing the look of stores?
A key aspect of doing that will be using entertainment to bring the technology to life in-store. Hopefully that’s where we have a point of difference, especially compared to our online competitors.
Another thing we can do is make the most of our passionate workers who are the experts in their field. If you are a consumer who’s very savvy about what the options are you might not need much advice, but many others are confused by the choice, and find advice instore useful.
There’s a lot of talk about multichannel at the moment, as retailers try to put a consistent message through all their channels. Does HMV face this as well?
Yes, and as a result we’re launching a service called myhmv. In its simplest form, we will roll free Wi-Fi out across all our stores. On its own that might not be that interesting but it’s what you do with it that counts. Effectively, when you go into our store you can interact with product on the shelves, but for the full experience you’ll be able to go into myhmv through your Wi-Fi connection and it opens up the broader world.
When you’re registered, and start to use the service then the landing page will become increasingly personalised. You might use it to get the latest offers or find out what’s new in store. You can read ratings and reviews, or watch video clips of product demonstrations, or share your views. You drive and navigate where you want to go. It brings technology to life.
And presumably it will further develop as you add in new services and so on...
It’s a journey not the destination. By opening up our stores in that way, as new services come on stream, we can introduce them to customers seamlessly. As people rely more on their portable devices, we’ll give them all the tools that become available. For example look at mobile payments, we’d be keen to move that forward. We want to give customers additional benefits such as click and collect, pay and collect. Myhmv can be an aggregator for all of that.
We have a new store in Cambridge that will be used to trial some new things out. It hasn’t got the myhmv service in place yet, but it does have a hub. It has a coffee shop area – the intention is to give people the opportunity to relax, have a coffee, recharge their devices.
You can try new headphones out with your tablet or try out your headphones with a new tablet.
Will people think you’re just reinventing the internet café?
Perhaps, but for me that’s where coffee shops are heading. Look at how people are using them now – they spend hours in coffee shops, using them for internet access or as an office. For us, it means you can rest, use the listening post app, sample some films.
Myhmv will be live very soon, then throughout October and November we’ll be rolling out free Wi-Fi and myhmv across the whole estate. Not all the stores will have myhmv hubs, but certainly the bigger stores will.
You’ve also recently introduced Click and Collect, is that right?
We didn’t want to make a big song and dance about it before we were satisfied it was working the way we wanted it to; it’s been running for ten weeks now, there’s been a three-fold take-up in the service and we’re confident there’s demand for it and we can deliver. The big thing is that it’s pretty much instantaneous as all the stock is in our stores, rather than held in warehouses.
It seems to be an important retail feature these days.
We see a big opportunity there at Christmas. Grocers become focused on groceries at that stage and online players can’t deliver all the way up to Christmas itself.
There’s a lot of big releases coming out this autumn and Christmas, in terms of both games and technology.
It’s good that there’s a lot of choice, though the flipside is that there are a lot of competing products out at the same time. From a retail perspective it might’ve been nice to have it spread through the year, although this year would’ve been an exception anyway because of the Olympics – there wouldn’t have been as many people in stores anyway. Instead we focused on multi-buys in the summer as a good way to increase value for consumers.
What else are you working on?
We’re also planning to introduce a Marketplace to the HMV website this side of Christmas.
Effectively, we will form partnerships with providers who can then sell through our website. One example of another retailer doing this is Amazon – but they quite often have competing products. Our priority is more to fill the gaps. Perhaps we don’t provide the full range in one sector, but someone can still come to our website and find the items they are looking for. Smaller, more local or niche merchants can benefit from our traffic.
We want to be the number one destination for entertainment and part of that is making sure people can find everything they need from HMV.
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