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Poundshops go digital

Source: Phoenix UX, 8 February 2014

There was a huge gap in the market for an online poundshop but in the space of a week 3 discount retailers have gone digital: Hereforapound.com, PoundPanda and Poundshop.com.

Established UK discount retailers such as Aldi, Lidl, Poundland have been slow to move online, and perhaps for the best, letting others to trial this model and see if they can be successful online.

The biggest ecommerce challenge for discount retailers is the shipping process, as for low margin products, the costs associated (delivery, returns) are too high.

A very good example of a popular discount retailer which trialled the online model is Primark. The retailer partnered up with Asos last year for a 12 week long trial period to sell some products online, but the deal has not been renewed. At the beginning of 2014, Primark's finance chief John Bason declared that cyber shopping 'doesn't work at the lower price point' due to the staffing costs involved in delivery and returns.

With a market already quite competitive for 'bargain' offers along with the potential risk of costs associated with delivery and returns, it would be interesting to see how this market develops.

Both Hereforapound.com and Poundshop websites are reasonably easy to use, although there is still room for improvement for features such as navigation and product selection. If this model proves successful, poundshops should definitely invest in responsive websites as well.

In the meantime, Pound Panda was pulled down days after it was launched at the beginning of February, due to family 'misunderstanding', although the website Poundpanda.co.uk, still features a holding page which states it is just a temporary technical problem.

Poundshops go digital