How did it all go so wrong? Perhaps that’s what Gerry Harvey is thinking right now. And so he should. In the space of a day, the canny retailer has succeeded in turning his own reputation from a positive to a negative.
Earlier this week Harvey was the home-grown success story, the eccentric billionaire with a canny ability to predict and tap into the psyche of everyday Australians.
Today he is the public face of a badly crafted campaign to force and shame Australians into curbing their online shopping behaviour. Harvey is now perceived as an arrogant capitalist, interested only in lining his own pockets with the limited cash earned by hard-working Australians.
How did it all go so wrong? To an interested observer it is quite clear. The campaign by the Australian retail industry is flawed no matter which way you look at it.
Politically, there are no votes in it. It pays to remember that it took three politicians to attempt bringing in a GST (Keating, Hewson, Howard) before it was successfully introduced by Howard in 1998. Even then it was a high-risk strategy and it would take a brave politician to extend the GST’s scope even now.
At a policy level, the imposition of GST on online purchases increases rather than lightens the regulatory load, with no discernable public benefit delivered as a result. No modern government would interfere in a market by increasing regulation without being able to point to a considerable public benefit.
From a behavioural perspective it would take more than a 10% tax to dissuade online shoppers, particularly when the price differential is often more than that and online shoppers still don’t have to contend with carparks, checkout queues or limited choices on the shelves.
And perhaps most importantly, the campaign is flawed from a communications perspective. Its key messages have no resonance with the people whose behaviour it is trying to influence, namely the politicians and the shoppers.
It appears the retailers’ campaign was neither strategically planned nor deployed.
No organisation should try to influence or change public policy without covering all these bases. The retailers should have been armed with market research and economic modeling to demonstrate that their case was legitimate and that it could deliver both political and public benefits as well as the behavioural change they sought.
They should have engaged on this issue at the departmental level first, with complementary briefings provided to MPs, key ministerial advisers and relevant journalists. This “pincer movement” strategy has the best chance of securing the attention of decision makers and creating the necessary momentum to get a favourable policy decision.
If these avenues have been tried and failed, it may have then been appropriate to take out ads in the newspapers.
But there is an old saying in the world of lobbying and advocacy: if you have to run to the media, then you are admitting that your other lobbying strategies have failed.
Going to the media is the final resort, a very public last-gasp attempt to shanghai a minister into a favourable decision. More often than not, this tactic will fail too because it is seen by both politicians and public servants as unnecessarily aggressive, overtly disruptive and ultimately self-centred. None of these perceptions serve well when one is trying to influence government.
And finally, perhaps the greatest weakness in the retailers’ campaign is its demonstrated misunderstanding of shopper motivations and behaviour.
Instead of spending mega-dollars on newspaper ads, the retailers should have taken steps to understand why customers shop online and how they might be enticed back.
The GST campaign suggests they have not done this even this basis homework, because it is clear that people shop online for more reasons than price alone.