Waitrose and John Lewis set out bold plans to reach more customers

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Waitrose and John Lewis have unveiled fresh plans to become the go-to brands for customers who want quality, value and sustainability.

According to the company, the new Partnership plan sees the business continuing to adapt rapidly to changing shopping habits, getting closer to customers online and in-store. The business said it also plans to expand in new areas where it believes its values can be a force for good. 

John Lewis & Partners Kingston, Surrey. Partners from the Kingston Branch preparing for the store re-opening post Covid-19 Mockdown

Making value and quality more accessible

  • Affordable quality. Waitrose will continue to emphasise the value for money offer and ensure that customers feel recognised and rewarded for shopping with the brand. Waitrose’s Essentials range has seen sales rise by nearly 10% in the past six months. John Lewis will relaunch its Home range in the spring and introduce more affordable price points. This will reinforce fair value to broaden the appeal to more customers, recognising shoppers are especially cost conscious at the moment, the retailer said.
  • Digital and virtual. As shopping habits evolve, the business is bringing expert Partners and products into customers’ homes through a tap on an app. This means investing in more virtual services like personal styling, home design and the John Lewis Virtual Christmas shop.
  • Waitrose – delivered. The retailer aims to grow delivery capacity beyond 250,000 orders per week, up from 55,000 before the pandemic, to give customers greater convenience. And, it will save 25% of delivery slots for the vulnerable. To attract new customers, Waitrose plans more partnerships like the trial with Deliveroo, which delivers shopping in 30 minutes. 
  • Inspirational new services. The business claims to be a Partnership for positive change, improving lives and building a more sustainable future. It plans to grow in areas where these values are important to customers, like rental, recycling, savings, insurance and private rented and social housing.

More sustainable and ethical

  • Net zero carbon. The business is bringing forward its ambition to be net zero carbon by 15 years to 2035.  
  • Waitrose sustainable food ambitions. The retailer is committing to source only from net zero carbon farms in the UK by 2035. And in addition to its commitment to halve food waste in its own operations by 2030, it is extending this to its supply chain too. Waitrose also aims to help halve customers’ household food waste by 2030.
  • John Lewis leading the ‘made to last’ movement. The retailer plans to do more to ensure its products can be loved for longer and today makes three bold commitments: all product categories will have a ‘buy back’ or ‘take back’ solution by 2025; all key raw materials in own-brand products will be from sustainable or recycled sources by 2025; and it will develop sustainable rental and resale options for customers. 
  • Recruiting people from the care system. Today, the business is pledging to recruit people coming out of the care system to help them forge a career in the Partnership.
  • Real Living Wage. All profits it makes are either invested back in the business or shared with Partners as co-owners of the business. Today, the business said it is committing that when it expects to reach over £200m profit, it will pay Partners the voluntary Real Living Wage. The company also aims to pay a bonus when profits exceed £150m and its debt ratio falls below 4 times.

Backed by a renewed focus on service and cost savings, the Partnership aims to see profits reach £200m in the next two years and £400m by 2025.

The company said the Partnership plan builds on strong momentum in a tough year. It has tripled delivery capacity for Waitrose online to over 190,000 weekly slots in just six months. John Lewis is now a 60% online retailer, and has successfully adapted to offer many in-store services online.

Investing in the customer experience

The company is committing £1bn over five years to accelerate its online business and transform its shops. This will make it easier for customers to shop with the retailers on its websites and apps, and provide more convenient delivery options. And it is modernising Waitrose and John Lewis shops so the business has the right space in the right place.

The company is aiming to save £300m per year by 2022, making its operations and head offices simpler and more efficient. Making these savings is crucial to free up money to invest and to deliver the plan, the Partnership said.

Better together

Waitrose and John Lewis will work much more closely together, in store and online, bringing new inspiration and excitement to all customers. Already this year, popular Waitrose Christmas hampers are available through John Lewis and John Lewis Christmas trees will sit at the front of 300 Waitrose stores, with shoppable QR codes. 

The company plans to make John Lewis more accessible locally in different formats, building on significant expansion in Click & Collect. It will soon have 1,000 locations – through shops and collection points – to buy or pick up our products to reflect changes in how people are shopping.

The business is investing in data analytics and loyalty plans across its brands to reward and develop deeper relationships with customers. Customer research is under way to inform its new value pledge, which will be announced next year. Never Knowingly Undersold remains in place until then. 

The ambition for Waitrose, which was recently voted Which? 2020 UK supermarket of the year, is to be customers’ first choice for food and drink when quality, ethics and service matter. More of the business will be online, delivered and digital.

John Lewis’ focus is on meeting the needs of families with a variety of products, services and celebrations all under one roof and online. As shopping habits continue to evolve, John Lewis is aiming to become a 60-70% online retailer by 2025. 

Both brands will also add more local assortments that reflect the diversity of customers depending on where they live. 

Partnerships for growth

The company is creating partnerships to reach new customers and provide capabilities it doesn’t currently have, building on trials with Deliveroo and online furniture rental business Fat Llama. The retailer plans to add more products to Fat Llama after all initial products were rented out. 

Today, the Partnership has also announced an additional 25 Waitrose shops will join five other stores in the Deliveroo trial, which is attracting new, younger customers. The company said is also in discussions with Deliveroo about joint community initiatives.

Inspirational new services

After the first phase of improving customer service in core retail business, the Partnership said it is committing a total of £400m to grow in new areas where it is trusted and which fulfil customers’ needs. The company said it is doing so because tightening retail margins in the long term won’t allow it to pay the wages it would like, or invest in customers and communities. The company is targeting 40% of profits from new areas by 2030.

Financial services. The Partnership is committing £100m over five years to quadrupling its credit card business, offering new products and services like savings and insurance, where trust really matters for customers. It is announcing a new partnership with four best-in-class experts to create a new home insurance product for our customer. Customers will also be able to apply for retail credit across all channels through a deal with BNP Paribas from early 2021.

Housing. The company has identified 20 sites that it owns that could be used to benefit local communities by providing quality and sustainable housing, while providing a stable income for the Partnership. It plans to make planning applications for two of these in the new year in greater London. Entering the ‘build to rent’ market also allows it to furnish properties using John Lewis Home products and deliver Waitrose food. The company is a landlord already at three of our properties so this is an obvious extension, it said. And it is in talks with developers and investors who can help it achieve its ambitions. 

Outdoor Living. The company plans to start by joining up what it already does across both brands, including horticulture in Waitrose, garden furniture in John Lewis and plant nursery, garden design and landscaping services at Longstock Park on the Waitrose Farm. It is carrying out research to understand what customers want, and considering new partnerships and possible acquisitions. 

Rental/Resale/Recycle. This is a growing priority for customers. THe company has set targets on being more sustainable and it has more than 20 initiatives running across its different product ranges or being developed to test with customers.   

Sharon White, chairman of the John Lewis Partnership, said: “We’ve seen five years of change in the past five months and Waitrose and John Lewis have responded with great agility. Our plan means the John Lewis Partnership will thrive for the next century, as it has the last.

“We’re adapting successfully to how customers want to shop today, while showing the Partnership is improving lives and building a more sustainable future. We’ll share our success with our customers, Partners – who own the business – and our communities.”

Nina Bhatia, executive director of strategy & commercial development at the John Lewis Partnership, said: “This is a bold plan to grow our business and get us much closer to our customers. Waitrose and John Lewis are two of the country’s most trusted brands and we’ll offer the best products and customer service on the high street and online.

“We’re creating new inspirational services for customers where strong ethical values and peace of mind matter, like reusing and recycling products, personal savings and rented housing. Our plans will firmly establish Waitrose and John Lewis as the go-to brands for customers that care about quality, value, and sustainability.”