John Lewis is reinstating its “never knowingly undersold” price pledge on Monday, following a two-year break. For the first time, the policy will apply to online as well as in-store sales. It will use AI to match prices with those of 25 major retailers including Amazon, AO.com, House of Fraser and Marks & Spencer. The move marks a new direction for the company, which has been seeking to recover losses with the closure of stores and job cuts. While the company returned to profit earlier in the year, it is expected to continue shedding jobs.
John Lewis managing director Pete Ruis has admitted that the pledge was not “fit for purpose” in 2022, in a world that had changed since the pledge was originally instigated, and where local customers were no longer the norm. His predecessor, Pippa Wicks, who ended the pledge, asserted that it was not relevant to online and non-local shopping. John Lewis staff will no longer need to rely on pencils spreadsheets and trips to other stores to monitor prices from competitors.
The updated policy will only apply to branded products, but the use of software will make tracking prices easier and more efficient. Although the move has been welcomed by analysts, including Catherine Shuttleworth, it is unclear how much it will cost the retailer and whether it will help the company win back customers. It is also impossible to predict how easy shoppers will find the new pledge to use.
John Lewis must make these decisions against the backdrop of a difficult retail landscape following the pandemic and the rise of online shopping. The sector saw a net loss of 5,000 stores last year, and companies such as Debenhams and Marks & Spencer have been forced to close premises during a major overhaul of their businesses. In addition to John Lewis, trendy clothing shops Topshop, Cath Kidson and TM Lewin have all collapsed, only to emerge online, highlighting the transformation of the retail sector from physical premises to online retailers
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