UK: Case Study: B&Q Direct
Last Updated: 7 May 2003

B&Q Direct’s online transactional website, www.DIY.com, was launched in January 2001. By March 2003 it had become one of the largest stores in B&Q and its continued rapid growth will soon make it the biggest store in the group. The site sells a range of 14,000 products and is already the number one store for many heavy and bulky items and many other smaller product ranges.

As well as generating considerable revenues of its own, DIY.com is part of a wider, multi-channel retail strategy that includes call centres and catalogues. All channels feed each other. For instance, 10% of those that shop in-store have researched their purchases online.

A critical component in the overall success of DIY.com and the B&Q Direct call centres is their ability to process credit and debit cards efficiently and to restrict the level of card fraud. In September 2002 B&Q Direct appointed DataCash, a leading UK-based provider of outsourced payment processing and fraud prevention solutions, to handle the credit and debit card processing for both DIY.com and all its call centres.

Before DataCash was appointed, B&Q had used a software solution provided by a US-based company to handle its card processing. B&Q had two key issues with this solution, one technical and one business, which led them to look for a new supplier.

  1. Technical Issues
  2. B&Q were using a software product from a US-based company. This presented three key issues.

    Firstly, because it was a software product it needed to be installed on B&Q’s own machines in their own premises, all of which had a significant Capex cost. Also B&Q had to design, integrate, test, implement, and most importantly, incur the cost and time of feeding and watering the hardware, software and communication links with the banks required to support and run the card payments processing cycle.

    Secondly, there were issues with the quality and timeliness of the software supplier’s technical support, some of which were problems inherent in transatlantic time differences. It quickly became clear that B&Q needed a locally based supplier if they were to get the quality and speed of support they expected.

    Thirdly, the focus and pace of software development was not in line with the desired direction for B&Q Direct, which was geared towards taking advantage of quick implementations of new value-add initiatives across the UK card processing market. At a time when the protocols and standards for processing e-commerce card transactions are still evolving, this lack of focus and commitment began to become a serious issue.

  3. Business Issues

Keeping fraud to a minimum is vital to any retailer, especially when margins are under constant pressure. Before the appointment of DataCash, B&Q was suffering from unacceptable levels of fraud, and was therefore under significant pressure to reduce its fraud percentage.

B&Q began to research suppliers of payment processing solutions that were able to support new UK-based anti-fraud initiatives like AVS/CSC, deliver fraud screening solutions and were committed to future card industry initiatives such as Verified by Visa.

In August 2002 DataCash was confirmed as B&Q’s payment processing supplier. In September the DataCash solutions were switched on. DataCash now processes all transactions that come from the web, store-supporting call centres and B&Q’s main call centre in Gateshead. The appointment of DataCash has resolved many of B&Q’s issues:

  • DataCash is a fully outsourced, hosted solution meaning that B&Q are no longer required to feed and water the hardware, communications and processing cycles. Delivering World Class service availability of over 99.99% allows B&Q to focus on its core skills, maximising the earnings potential from its web site and call centres.
  • As a UK-based company, DataCash is sensibly located to provide B&Q with high quality, highly responsive technical and account management support.
  • DataCash’s XML APIs were "extraordinarily simple" to integrate. "The whole process of design, integration, testing and implementation took six weeks. Post-live support lasted two weeks. In the context of the size of the overall project, this was very light", says Matt Louth, Head of Application Development at B&Q Direct.
  • Meanwhile, DataCash’s web-based, real-time MIS Reporting service enables B&Q to monitor and report on transactions on a summary-to-detailed channel basis.
  • Within six months fraud has quickly been reduced through a combination of AVS and highly sophisticated, customisable fraud screening tools. Experience suggests this will continue to fall as historic data allows for more fine-tuning of the fraud screening rules.
  • DataCash, through its early accreditation and support for Verified by Visa protocols, has demonstrated its commitment to keeping pace with future trends and requirements.

Quote from Gavin Breeze, Business Development Director, DataCash:

"B&Q Direct is a delight to work with. We take great pride in our ability to deliver World Class outsourced payment solutions and relish the challenge of meeting the demands of leaders in their industry. In the six months since we began working together, B&Q have seen their transaction volumes significantly increase, and at the same time fraud has been significantly reduced."

Quote from Matt Louth, Systems Manager, B&Q Direct:

"Our aim is to make a customer’s shopping mission as quick & easy as possible, and as part of delivering against this principle we have chosen to work with DataCash. The integration of our web and telephone sales channels to the DataCash solution has allowed us to minimise any payment related delays in order processing, whilst providing a toolset that leaves us better able to detect fraud."

About DataCash

DataCash is a division of Auxinet PLC, which began developing electronic payment technology for many of today's commerce-enabled web sites in 1996 in response to the emerging demand for secure, real time e-commerce transactions. With a customer list including FTSE 100 and dot.com companies, Auxinet has an enviable track record of delivering market-leading payment solutions supported by exceptional customer service. DataCash’s early lead in developing "credit card not present" transaction environments, gives the company a distinct advantage in servicing the demands of organisations, whether they are selling via the Web, Interactive TV, Kiosk, Call Centre, Interactive Voice Response ('IVR') or even High Street point of sales channels.

About B&Q

B&Q has been in the DIY business for more than 30 years and is the UK’s most successful and innovative home improvement retailer. B&Q employs over 33,000 people in over 320 UK stores.

B&Q operates two different kinds of stores – the larger B&Q Warehouses, which cater for the needs of the keen DIY’er and trade with their wide range of products and staff expertise, and B&Q Supercentres which are convenient for most people to pop into for their everyday needs.

DIY.com was launched as a fully interactive e-commerce site in January 2001. It stocks approximately 14,000 products and is a subset of the B&Q Warehouse range.

Contact names addresses:

DataCash

Gavin Breeze

Director

Gavin@Datacash.com

T: 07770 752 563

B&Q Direct

Matt Louth

Systems Manager - Application Development

E: Matt.Louth@b-and-q.co.uk

T: 02380 625156

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