Never Knowingly Undersold (Again)

On the 5^th of September 2024, John Lewis announced that their key policy of “Never Knowingly Undersold” was to return for the modern age, after the policy was withdrawn in 2022. Originally launched in 1925, in their Peter Jones store in Slone Square, this policy set John Lewis apart from their competitors, by being a retailer that could always be trusted on price and service. This policy will see John Lewis price match across 25 competitors including retailers such as Amazon (on technology), Harvey Nichols and M&S, with the emphasis also on quality and service.

Despite department stores being a convenient way to shop with everything under one roof, in recent years this particular area of retail has faced difficulties, such as a significant loss of customer footfall. We have also lost familiar department store brands completely from our high streets such as BHS and Debenhams. The Ordnance Survey data in 2022 showed that over two years department stores had reduced by 13.4%. John Lewis itself closed a range of stores in 2020 and 2021, including key stores such as Birmingham, Swindon, and York, to customer dismay.

Given such difficulties and the challenge of making a profit - why has John Lewis decided to re-introduce this policy in 2024?

Firstly, John Lewis is a familiar and trusted brand that is well-liked by customers, which is why so many were disappointed when their local store closed. The Never Knowingly Undersold promise returns John Lewis to the status of being reliable and trusted. At a time when we still feel the effects of the cost-of-living crisis, a price promise is reassuring. Secondly, whilst online competitors may be cheaper, there is still a place for the store, but as customers, we want good value. The latest ONS data shows that online sales have held steady since the pandemic peak at around a quarter of all sales, with July’s sales being 26.7%, this makes a price promise much more reassuring when shopping in-store and no need to wait in for a delivery! Thirdly, when customers are price conscious, they will seek out competitors which is why John Lewis has lost customers, this may be the key to winning them back. Finally, it is an easy-to-remember promise, familiar and a clear statement and very much reflects the brand values of John Lewis.

However, it is not just enough to focus on price – just a price promise is unlikely to be enough to stand out and revive the department store brand. As well as keen prices, customers are looking for quality, reliability and often a bit of excitement (which is why the middle aisle at Aldi is loved by many customers!). In addition to the return of the Never Knowingly Undersold promise, we are also likely to see more strategic developments by John Lewis. If they want to make their department stores attractive and keep the customers who do want to shop in-store, rather than being a store of 1925, they need to be the store of 2045. As customers do have the default option of buying online, stores need to be exciting and experiential. John Lewis has started by re-developing their beauty offering to create a more interactive experience that reflects customer needs (and is also more like their competitors such as SpaceNK). Anyone looking to take a break from shopping can also go to the roof of John Lewis on Oxford Street and relax in the rooftop bar and kitchen1864 once again offering an immersive experience. They have also stated that they will focus on quality and offer the best brands under one roof. Of course, if people are shopping in-store one core requirement is good personal service and advice, many customers have felt that in recent years the service in John Lewis has fallen far short of expectations, so the retailer will be investing in bringing more partners to help customers, aided by technology for a seamless experience.

To succeed today as a department store retailer, you need to cut through the competitors and be true, trusted and tremendously excitingly experiential!