Outspoken Retail King, Gerry Harvey, is well known for his negative stance towards the online retail industry. Yet in light of comments made at his superstore Harvey Norman’s recent annual meeting, is it time for King Gerry to give up the crown?
It’s hardly surprising that Harvey Norman Chief Executive Gerry Harvey is negatively bleating about the online retail industry once again. As Christmas looms, Harvey warned at the retail giant’s annual meeting yesterday, that the upcoming festive season’s sales period for Harvey Norman would only be “okay”. While the blame for this was laid indirectly on the online retail industry, Harvey made a number of interesting comments around the issue that simply begs the question: Is Gerry Harvey past it?
There is no denial that Harvey has done something great with his superstore chain – if he hadn’t, there is no way he’d now have 230 stores across seven countries, 50 years after first opening the doors of (what was then known as) Norman Ross. However, Harvey’s obvious reluctance to embrace the online retail industry makes one wonder if it is as a result of a genuine, yet somewhat misguided concern for an industry he is passionate about, or rather a severe lack of understanding of how retail is evolving in Australia and the rest of the world.
Over the years, Harvey has made no secret of his disdain for the online retail sector. Think back to the infamous “online shopping is a dead-end” comment, when he said “he wouldn’t spend another cent on his own retail business’ e-commerce interests”, as well as his vocal backing at the end of last year, of the National Retail Association’s (NRA) call to put a GST on products purchased from overseas online retailers. Harvey offered himself up to front the NRA’s campaign, which resulted in scathing backlash against Harvey directly, as well as his brand, mostly played out over social media by disgruntled consumers. While Harvey was forced to admit pushing this was nearly “suicidal”, by choosing to blame the dawn of social media for making him a scapegoat, he effectively failed to grasp the lesson in, or simply ignored, what had happened – consumers now have a powerful and public voice that can and will leave retailers reeling…and sometimes looking silly.
Although Harvey Norman finally launched its e-commerce site last week, and with its board predicting the online business will grow to one percent of total sales this year, and by one percent per year for the next three years, it still sounds as though Harvey is fighting the evolution of 21st century retail. As he so eloquently put it, he believes there are a lot of “bull s****ers” out there promoting the benefits of online retailing. He feels that accurate sales and profit figures are difficult to come by, and therefore businesses should be realistic about the effectiveness of selling on the web.
Other comments made by Harvey during the meeting suggested everyone will wind up regretting the advent of the internet in the near future, and even attacked the very people Harvey Norman sells to, with Harvey taking aim at technology-obsessed consumers who spend large amounts of time looking at computer, tablet and mobile phone screens, saying, “They live on the bloody things. It’s so invasive into your lifestyle.”
At the end of it all, while Harvey Norman, the brand, has taken the next step at bringing the superstore up to speed with progressive retailing, Mr Harvey, on a personal level, is still dragging his feet – and why he is, is still a mystery. His comments only serve to make him sound out of touch with, and confused about, the state of both traditional and online retailing in Australia, and the evolving profile of modern-day consumers.
It’s just so ironic that Harvey himself recently said, “The problem with our little world Australia (is) we wait too long to act.” Although he was referring, yet again, to placing a GST on goods purchased on overseas sites, why can’t he see that, when it comes to the future of successful and relevant retail, this is the point exactly?