HOMECHOICE: Omnichannel Rollout Boosts homechoice Ambition

One of South Africa’s favourite retailers is celebrating four decades of success. Homechoice, founded in 1985, in a very different South Africa, has for 40 years been adapting and learning to deepen its understanding of “her” – its core demographic, more than 80% female, usually mothers, in the mass-middle market (75% LSM 4-8), earning around R10,000 a month, between 30 and 60 years old, living in the country’s urban areas, and utilising various channels for shopping.

“She’s always shopping somewhere, she just might not be shopping with you,” then-CEO now Executive Chair Shirley Maltz told Enterprise Africa in 2018. “If she’s not shopping with you, it’s because your products are not good enough. Whether it’s your merchandise, customer service or whatever. We push ourselves very hard to stay apace with the customer.”

This pursuit of the customer trends, and the agility to meet her needs, resulted in the adoption of a multi-channel strategy seeing homechoice move from traditional direct selling via a catalogue, to digital channels – underpinned by a large call centre – and now a bricks and mortar store network.

In 2018, the company was celebrating the opening of its second physical premises in Maponya Mall after opening its first showroom in Wynberg. Another followed in East London before a flagship was unveiled in Rissik Street Johannesburg before a further launch in Nelspruit.

Now, the focus on using different channels to reach consumers is more important than ever as shoppers’ habits change quickly. Managing Executive, Richard Eberlein tells Enterprise Africa that the company’s focus will always be around connecting with her in a way that suits her while maximising value for homechoice.

“Our key strategic objective for our customers is for us to design and decorate her own room. We can fulfil all of the design and delivery, and we can offer that with affordable credit over six, 12, 24, or 36 months. That helps us to get to the mass market within South Africa,” he says, highlighting the importance of relevant credit options that few others have bothered to innovate.

“This year, we have focused on our active marketing customers. As a direct marketing company, we focus a lot on how to retain and get lifetime value from our customer base. We have been busy improving that lifetime value. We want to meet her with the right product, at the right time, in the right place, while giving her the right credit so that she can afford it. The result has been great growth in our customer base that sets us up for the next three years.”

MANAGING EXTERNAL FACTORS  

Eberlein has been in the retail and hospitality industry for his entire career and has developed a strong skillset and problem-solving nature for almost all challenges that come up throughout trading cycles. But those outside of the control of the business are always more difficult to hurdle.

“In South Africa, the Post Office has been very challenging. We used to send a catalogue to 500,000 customers monthly. The Post Office began failing in 2018 and we had to look at alternatives to get a catalogue to customers and that was a challenge,” he says of infrastructural problems. “POPI has given us some challenges as a direct marketing company looking to contact customers. We have put strategies in place to work to that. Covid created its own challenges, and we were able to equip our call centre agents to work from home, whether that was in townships or suburbs, and that enabled us to trade through Covid.” 

Often, the solution to even the toughest challenges is strong local partnerships. Here, homechoice is well-equipped. The company has longstanding collaborators that are themselves industry leaders in their fields. 

“We like to work closely with other local businesses in partnership. It’s about working together for the benefit of all rather than just one company taking advantage,” says Eberlein. 

These partnerships are based around delivery of the highest standards. Eberlein and homechoice accept nothing but the best from supply chain partners, and the standing of the company can only grow if the customer is revelling, returning, and recommending. 

“From a product point of view, we have a key focus on the quality we offer our customers,” he explains. “We will not be fighting at price level. In South Africa, a lot of our competitors focus on lower income groups and compete on price. We would rather focus on quality and give our customers the opportunity to pay over months rather than paying in cash for something that will not last them.” 

Delighting customers in this way, encouraging generational adoption of the brand, while embracing new channels sees the ambitions for growth not dampened since Maltz suggested in 2018 that homechoice was cautious about continental growth.

“Currently we are in South Africa with a small presence in Namibia, Botswana, eSwatini, and Lesotho but the key focus post Covid has been South Africa,” details Eberlein. “As an omnichannel retailer, we traditionally focused on having a large call centre but we have moved away from that in the past few years to concentrate on our showrooms. We have an aggressive showroom rollout combined with a digital strategy and we are well set for a strong 2025 and future growth.” 

This growth will come from the company’s unrelenting focus on understanding her, being there for her, and offering what she wants when and how she wants it. Within the omnichannel strategy, this foundational conviction will continue.

“We have 40 years of quality, 40 years of being there for our customers by offering credit that they might not have received previously, and 40 years of strong partnerships. We are not old, we are looking forward to the next 40 years at least. We are very resilient and able to adapt, and we are always building new platforms for growth,” Eberlein concludes.