Alex’s blog: Boohoo’s online marketplace move – how will consumers fare?

4 min read
January 29, 2021

News this week that Boohoo Group has bought the Debenhams brand and website after the once-loved department store chain’s collapse just before Christmas has genuinely fascinated me.  

Retail groups buying up other retail brands to expand their reach, or indeed their product offer is not exactly ‘news’. And in the wake of the pandemic it was clear that some big name store chains were going to struggle – be it because they hadn’t produced the most effective online shopping offer, that their in-store experience was the focus (and they haven’t exactly had the opportunities to showcase this lately), or it – sad to say – has simply become ‘not of the times’.

But this latest move has left me wondering about a genuinely changing face of shopping – and I’m not just parroting ‘the shift to online’. I’m talking about a more substantial shift to this concept of the online marketplace – the term Boohoo Group is using to describe its aspiration. While this undoubtedly means a much-desired diversification for the group – which operates almost wholly in fashion, does it really mean the opportunity for consumers to be ‘diverse’ in where they can shop – and is it truly inclusive to all consumers when it’s cast under one umbrella?

What does our data say?

For those that may not have heard of Boohoo Group, it’s the owners of fast fashion clothing brands Boohoo.com, Nasty Gal, Prettylittlething and Miss Pap. All operate online only. However, it has in more recent times bought struggling established high street fashion brands including Karen Millen, Warehouse and Oasis – but only the websites. 

It’s clear that Boohoo brands – particularly Boohoo.com itself – are regular destinations for the online shopper in their droves. We can see this closer to home by the number of complaints we receive. Across the group (not including Debenhams as yet of course) Resolver saw just over 20,000 complaints in the past three years. 

High complaint volumes alone do not mean these brands are ‘poor’ and looking at our data we can see that in the main Boohoo and its brands have a good track record for a satisfactory resolution. But the types of issues people complain about are interesting. 

Deliveries not being received are predictably high up there given the online only nature of the group’s offering, but more than one in 10 referenced a problem with the products customers received, whether it be deemed poor quality, was faulty or had broken. 

This to me is slightly concerning, considering that over the same period, while Debenhams alone registered more than 11,500 complaints over the past three years, just 2% of these related to problems with the products. Again, it’s more than likely given our data that these complaints were handled by Boohoo to their customers’ satisfaction, but it does resonate that not being able to see and touch what you buy can be more hassle than you perhaps realise, and I wonder what this means for the products it’s not universally known for when Debenhams ‘joins’ Boohoo’s online platform in spring next year.

The department store experience versus the ‘online marketplace’?

What is interesting to me then is the choice to buy the Debenhams brand and website in terms of the group’s longer-term aims. Unlike Boohoo’s other acquisitions, Debenhams as ‘a brand’ is not synonymous with individual product lines such as clothing, beauty or even homewares. Of course it’s known for selling all these types of products, but the brand itself is connected with the once iconic ‘department store’. 

So, while Debenhams doesn’t specialise and does offer a place to buy other brands it is still very far off of the aspirations of Boohoo to provide an ‘online marketplace’ platform. I’d argue that (discounting those that flocked to the sale after its collapse) Debenhams shoppers online were there for that department store ethos. A more careful choice of brands, not an exhaustive plethora of anonymous products (typical of current online marketplaces) and perhaps more tailored (if not necessarily personalised) approach to its customers, rather than a slightly faceless, distanced approach. 

Boohoo is already stating that while Debenhams brands will continue to be sold on Debenhams and Boohoo’s other websites, there are plans to introduce new brands in the future – to many a logical expansion, but to others will it represent an attack of the senses, and will that, given Boohoo’s current target market (16-40 year olds), pave the way for a lack of inclusivity for certain types of consumers?

But it’s innovation right?

I’d also question the ‘innovation’ here. Online marketplaces have been around for a while and among the many points about consumer rights being more woolly if you buy from them, they – let’s be fair – have not always had the best track record for great customer resolution.  

I do feel that this is a bold business move for a group that has clearly been successful in its endeavours the past few years. But the online marketplace mentality of ‘buy everything here’ but with little personal touch or communication directly to your customer I think takes away from the experience, even if that experience is digital. And, with news that ASOS is circling the most well–known Arcadia Group brands (Topshop, Topman and Miss Selfridge) it looks like this trend for ‘choice’ under one umbrella is set to continue. 

I’ve often said that ‘disruptors’ encourage innovation so should not be dismissed, but there is a point where innovation alone isn’t enough if the customer service is poor and people struggle to get things put right when they go wrong.  Let’s hope Boohoo plans to retain the old fashioned customer service principles of the Debenhams brand while making good on its promise to add ‘more new brands’ to the platform once it’s established.

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