Paul Coby is IT Director at John Lewis
The old adage of ‘innovate or expire’ has never been truer than on today’s high street and the retailer stampede to harness startups’ technology is now well underway.
Our annual JLAB accelerator is in its third year and in the last two months alone, a host of other retailers have announced their own programmes, all in search of a cohort of early-stage startups who can introduce innovation to corporates in exchange for vital investment.
Retail technology is now truly global and this year’s JLAB received applications from as far afield as South Korea, Belarus, the US and Hong Kong. Is it any wonder why big business is keen to capitalise on this diverse display of entrepreneurship?
A win for customers
Customers will be the big winners from this relationship. Over the next five years, we’ll likely see a dramatic change in the way we shop as tech developments lead to the customer experience becoming more convenient and more exciting.
By collaborating with startups, retailers are able to fast-track the latest products onto the market and into our homes, and incorporate systems that revolutionise the day-to-day shopping experience.
At JLAB’s Pitch Day this month, 25 carefully selected startups presented their ideas to a John Lewis panel, all vying for a place on the 12-week accelerator programme.
Concepts included a platform that lets you rent clothing on a monthly subscription; an AI-controlled wearable scent bubble that releases fragrances; and sleepwear that uses body temperature modulation to improve sleep.
Accelerators like JLAB can provide vital support for these kinds of vibrant young tech businesses.
There’s the potential for funding of course, as well as the prospect of their products appearing on John Lewis shelves in the future. But we’ve found that the aspect that most appeals to startups is the opportunity to tap into our retail expertise.
Bad accelerators damage business
A number of the companies we’ve met have come away from previous accelerators feeling they didn’t derive that much from the experience.
While many corporate programmes provide excellent opportunities for fledgling entrepreneurs, others have been criticised for providing little more than a drawn out due-diligence process. It can appear little more than corporate investors getting a ‘try-before-you-buy’ deal with no guarantee of end investment – or value of any kind – for the startups.
I believe a purely financial attitude serves neither party well. The chances of big business uncovering the next ‘unicorn’ are slim, so equity will likely never bring the retailer earth-shattering amounts of cash.
From the startups’ perspective, enrolling in a three-month programme is a significant commitment that needs to offer more than a potential cash prize.
Aside from investment, this year’s JLAB programme will provide extensive mentorship from our senior executives who have years of experience in understanding customer trends and retail market patterns. They know what sells and how to sell it.
This sort of expertise is worth far more than funding. It can be transformative for a fledgling company, turning tech pioneers into thriving businesses. I also hope that the values of the John Lewis Partnership will rub off on them.
If programmes continue to provide shoddy experiences, startups could easily turn away from accelerators, and towards other forms of fundraising and mentorship instead.
And the end of the corporate-startup relationship would prove deeply damaging to big business.
No startup slides
We launched JLAB not with ambitions for equity, but a desire for insight. John Lewis is one of the country’s leading retailers, but we recognise that our customers’ habits are changing at a rapid pace and as retailers we have to learn to change.
These young, agile companies can help to bridge this gap. With this in mind, we rejected the option of hiring a bells-and-whistles, ping-pong-and-slides startup den in East London and instead we welcome the finalists into our Victoria HQ. Here they can work alongside our retail experts and IT teams. We aim to encourage idea exchange on both sides.
We want to develop ideas and products that excite our customers and keep them coming back.
We also want to keep ahead of the latest tech developments. Disrupting a sector is all well and good when you’re pulling the strings, but being on the back foot can spell disaster – see black cabs and Uber, hoteliers and Airbnb, or retail banking and fintech.
Our mission is to bring the innovative startup mindset into our own business. By nature, these fledgling companies have to overcome challenges every day, and they’ve succeeded thus far with an inventive and agile approach to the problems they’ve encountered.
They are restless and driven. They are constantly searching for solutions and we hope this restless frame of mind is infectious.
As a business about to celebrate our 153rd birthday, it would be all too easy for John Lewis to excuse outdated practices with a nonchalant ‘we’ve always worked like that’.
But the way all of us shop is evolving almost daily and accelerators provide a perfect avenue for retailers to not just keep up, but set the pace.
We must constantly strive to deliver the best experience for today’s customers and the mentality of startups – who live and die by how innovative they can be in an intensely competitive market – is a fine example to live by.
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