Following a slew of high profile senior departures from NBrown plc over the last 12/18 months including the CFO, Buying Director, Customer Director (whatever that means) and CMO it seems that 'Steve Johnson' (CEO) and others on the board believe that replacing these key roles with people from the (non retail) airline industry Rachel Izzard (former CFO Aer Lingus) and wait for it...........'Sarah Walsh' from that huge physical retailing success 'Oasis/Warehouse' as CEO for 'Retail' - Now I don't personally know any of these new appointments and of course I genuinely wish them much success, but I have to think WTF is really going on in the mind of this board?.

N Brown plc is a UK based traditional home shopping online and mail order company, who back in the day held the prestigious sustainable business title of being over 100 years old, also back in the day it was the bellwether for the UK home shopping industry, something they basked in for longer than was healthy as the following will highlight.

In late 1999 following a strategic review of the 100 year+ offline catalogue business it was agreed to embrace the internet as a means of driving down cost.

It's at this point I was fortunate to be invited (recruited) to help them deliver the strategy for this key objective. As the newly created position of 'Group Head of eBusiness', I was pivotal along with a number of other internal stakeholders to take the then offline mail order business of 65 trading brands, and migrate as many existing customers (circa 2m) over to our online channels. 

Today eCommerce represents over 87%+ of total sales, the majority of that from a brand we launched in 2001 (SimplyBe) that generated 16% of first orders online and the old chestnut that is JD Williams. Yet the business and any sensible online and business strategy is in freefall as the 5 year share price, latest trading statement and board room turnstile will evidence.

It's also important to recognise that N Brown plc were previously perceived as the most successful direct home shopping company in the UK as measured by percentage of profit to turnover - but that was then!

The NBrown (JD Williams) story can be found (here) if it's something that's of interest to you. 

The key thing about N Brown (in my informed opinion) is that like others in the retail sector they have been led by analog leaders. As such they've gone from being poised to seize the UK and international market opportunity for online shopping. To do this required them to reinvent not only themselves but also an outdated business model.

In the early part of the last decade they were way out in front of anyone else with a huge (spending) customer base, immense brand equity, proven logistics, and of course the plethora of eCommerce platforms we had implemented in record time. 

Incremental change in a dynamic digital world is proving to be the real business threat, in particular when the online social media community has today become the killer App. 

Unfortunately and like many others in the industry this is a company that's had more than a decade of leaderless bewilderment, risk averse leadership, and without a doubt lack of clear innovation direction and a sound understanding of the tsunami of consumer behavioral change that's impacting retail businesses old and new alike.

As such they left the market wide open to numerous laggards and competitors (Shop Direct Group) and start-ups like ASOS, MissGuided and Boohoo.com - N Brown might argue that isn't their customer base, I would profoundly disagree. 

In its share listing it's described as;

"N Brown offers a range of products, predominantly clothing, footwear and homewares with a focus on underserved customer groups". 

By 2001 we grew an online business to £30m turnover in less than 18 months. Of course this move had a huge impact on reducing call centre cost, and of course we were seen as the 'business to watch by the City where the share price was suitably raised, and closely watched by others in the retail sector looking for that nonexistent eCommerce 'silver bullet'.. 

We even went out of our way to establish a 3rd party logistics company in order we leverage our IP and infrastructure for the burgeoning eCommerce sector. When announced (Zendor.com) also had a positive impact on the share price from city analyst that themselves were still trying to understand the ramifications on the sector for eCommerce.

This was a company with the opportunity to dominate and own the online space, key to this was the need for bold constant reinvention, innovation, and brave visionary leadership who could see and invest in the future opportunity. 

Unfortunately bean counters always choose the safe and incremental route, so rather than fixing the N Brown roof whilst the sun was shining they elected to use the medium to reduce cost as the primary strategy, the thrust to reduce the mail order side of things along with moving the brands and same discount led customer recruitment proposition into failed international waters.

We saw some shoots of innovative 'brand' thinking with the likes of 'Viva La Diva' and 'Discountworld' but none really gained the internal support needed to move the digital dial forward.

For me the worst decision in recent years taken by what was then the new CEO  'Angela Spindler'. Angela's view for the bright new N Brown future was to reduce paper based activity (fair enough) but also to push on with a physical retail store strategy for brands like 'SimplyBe' and male outsize brand 'Jacamo'. 

To do this they elected to test and trial physical retail space with a number of store formats to help with those 'under served' customers, after all this was supposed to be 'Angela's' strength and background wasn't it?. 

What was to be the new retail frontier turned out to be yet another expensive distraction from the core online business proposition, the logistics opportunity, and completely missing the behavioural changes in the consumer as a result of the global growth around social media.

The conversation and opinion piece that was prompted between myself and 'Drapers Record' was the recent red flag announcements regarding the senior team.

NBrown is a business that's historically been ran by finance people, during my tenure I worked with Jim Martin and the really great 'Alan White' - the background makeup of the board is no is no different today, other than these are not visionaries. 

If you look at the makeup of the board you will struggle to find anyone with a contemporary online retail or marketing pedigree - the majority are bean counters by profession - more of the same but with a tad more incremental change thrown in to keep the city happy?. 

Sure they pay lip service with the Non Execs like Matt Davies formerly of 'Pets at Home Tesco, and Halfords'. Then there's Richard Morros who built and sold online business printing card company moo.com, and finally 'Michael Ross' who sits as a advisor on 'Sainsbury's' board (need i say more) and sold his late 90's start-up Figleaves.com to NBrown who proceeded to fuck that one up as well.

Its an ineffectual analog board and non exec team acting as an echo chamber operating in a socially savvy digital world!!!

The N Brown business model is/was predicated upon all it's customers operating a credit account, which in turn has meant that the key drivers of the business were as a result of it's financial products, and not so much its sale of physical products to consumers.

Fintech has blown that model apart with the likes of 'Klarna' providing all kinds of retailers and consumers the opportunity to 'spread the cost' - instantly!!!.

Here's a snapshot of the most recent trading statement 16/01/20 note point 4 FS Revenue.

Steve Johnson, CEO, commented: "This has been an encouraging period of peak trading for the business in a highly promotional market, as we delivered digital revenue growth across both Womenswear and Menswear with particularly strong digital growth from Simply Be and Ambrose Wilson as customers responded well to our ranges. Financial Services revenue was down, reflective of our strategic approach to the retail business and continued tightening of our lending criteria.

So when I saw that they seem to be operating the same retail recruitment incest strategy we are seeing from other struggling retailers it caught my eye, attention, and concern.

Unless the board wake don't wake up and smell the digital and social coffee everyone else is drinking there are a number of things that will drive this freefall at a much faster rate then they have witnessed before;

• Work out where you can add value to today's customer and play to your inherent strengths for home shopping - reestablish the 'Why'.
• Social Commerce is here - what are you doing to exploit the opportunity and mitigate risk.
• With 3.8bn people on social media around the world your customer is your next competitor - what can you do with 'live streaming'?

Weibo recently announced that its native live streaming platform, Yizhibo, will be rolling out Taobao integration. While the development is big news in its own right, it also underscores the momentum driving e-commerce content marketing and what is going to define media, marketing, and retail trends for China in 2020.

When I see the continued rise of 'social commerce', and in particular 'live streaming'  (another thing we at NBrown experimented with back in the day, but difficult to do with a really shit internet connection) I wonder how much this analog minded board are looking at this and wondering "hows this going to profoundly impact us and change what we do as a business?"

In February 2019, Alibaba took on a 10.8 percent stake in Bilibili (Tencent holds a similarly sized stake), whose e-commerce business was growing sluggishly in comparison with the exponential growth of its live-streaming revenue. Content-to-commerce integration between Bilibili and Taobao swiftly followed.

This is real, this is happening now, what's your plan to rethink and save this 100+ year old business,along with its people and related supply chain?

In the face of a pressured financial services business model I don't think recruiting people to open up physical stores is really the priority - do you?

Link to original article below.