High street retail isn’t dying. But boring high street retail is.
High profile high street casualties are numerous at the moment. It’s happening throughout the retail, hospitality and leisure spectrum.
Recent examples are Toys R Us and Maplin, which account for an astonishing 50% of the roughly 650 shops and restaurants, run by a handful of major chains, that have shut since the start of 2018, or are at risk of closure. In the world of hospitality, Byron, Jamie Oliver, Square Pie and many others have felt the heat.
Of course, we take seriously the scale of the problem facing British retail on issues such as business rates, Brexit and lease prices—particularly in the Capital—but we also appreciate that innovation and differentiation are key to success.
The generational mobile gap
In a 2018 survey of 2,000 18-35-year-olds across a number of UK cities, figures showed that 74% still prefer physical stores, but 51% also said they’d love to navigate, get information and pay using their phone instore. Ultimately, customers don’t want to be limited by a store’s maximum stock, opening hours or a fixed customer-staff interaction model. They want to be able to buy from their favourite retailers, with full knowledge of their purchase, anytime, anywhere.
The role of mobile in the success or failure of retail is now undisputed. Some of the world’s most successful food brands are now mobile-first. Look at the success of Deliveroo, with its $2bn valuation in 2017 and its 40,000 global workforce. All for an app-based delivery service.
This narrative isn’t limited to the UK, either. It’s happening around the world. In a report by PWC, 40% of respondents to a survey of 18-24-year-olds in the Middle East, a preference was expressed for purchasing online. Their main motivation? Price.
But this doesn’t necessarily mean a race to the bottom in high street retail. It simply means that retailers need to provide customers with greater freedom. In other words, provide customers with experiences they can’t get anywhere else.
Ultimately, the global trend is that young audiences are looking for greater purchasing freedom.
- A survey from Omnico finds 70% of shoppers aged under 35 would like to see store hours extended.
- A survey by Google shows that 72% of shoppers visit a shop to check out a product, with plans to purchase online.
This all amounts to an omni-channel approach. Where customers use brick and mortar stores as showcases for brands’ products, centres for learning and some purchasing, they then use online to extend the number of key touchpoints and make their purchase.
Those businesses that meet the changing requirements of their customers will succeed, relative to those who remain entrenched in the past.
A recent trend in retail has been showrooming: The idea that the store environment can act as a physical look book for the brand’s products. A good example of this is Paper Mache Tiger, which uses its physical space to display the latest designs for the season to the press and stylists.
This has become prevalent, especially in high-end fashion. But with customers looking for greater choice and selection, retailers have discovered that offering customers the opportunity to access and make purchases in these showrooms can be lucrative.
At Paper Mache Tiger, for example, beyond the threshold is a coffee machine, tables and instagramable plants, followed by purchasable clothes. This is a showroom and shop combined into one.
During the week, the space is run by retail staff, with the sales and communications team taking weekend shifts. pretty much ‘everything but the couch can be bought’. There are also in-store events, with plans for an upcoming Christmas party open to everyone, press and consumers. This is showrooming and store evolved, glued together by a strong marketing and PR function. It’s anything but boring.
High street retail is not disappearing. Only boring high street retail is. If brands want to thrive in today’s market, they will need to adapt to the changing demands of the customer. At CADA Design, we have expertise helping brands to transform and grow, providing strategic insight that very few others could. If you’d like to speak with us about how we can help you adapt. Contact us today.