Online shopping is just one of the many wonderful developments since the turn of the millenium. No queues, stock readily available, and no need to leave the house? Yes, please!
Unfortunately, like many industries that have suffered from the advancements in technology over the past few decades, the High Street is enduring a considerable challenge from online retail, as stores close at an alarming rate across the UK.
Household brands such as House of Fraser, New Look and Marks & Spencer have recently had to shut down stores to preserve running costs and restructure their sales strategy. This year, popular fashion chain, Select, was forced into administration. What’s more, as detrimental an effect this is upon business, this causes a grave concern for employment.
This year, the British Retail Consortium published figures suggesting that 1 in 10 town centre shops are vacant, furthermore the amount of empty shops increased by over 7500 last year.
As a result, it is predicted that approximately 40,000 jobs have been lost or risked in the UK.
As displayed by the graphic above, the ratio of online sales compared to High Street sales is increasing drastically, especially during the festive period.
What’s stopping the High Street from becoming obsolete?
Karen Millen, former owner of the clothing brand that bears her name, was quoted as saying in a recent interview with the BBC,
“It’s still about experience…
People are looking for combining shopping with an experience and social time, a place you can eat, meet friends and shop…
It’s a place where you won’t be rushed, and you can find something that is destination-based, whether it’s for entertainment, food, products or the environment, and walk away with a gift for the home.“
The overall point being that stores need to be attractive places to visit. If your store is messy, disorganised and offers slow service, customers are likely to prefer finding your products online.
If your store is pleasant, clean and is known for quick & friendly service, people are more likely to go out of their way to visit, even if shopping online is more convenient.
As an example, in a recent Which? Survey, household high street chain, WHSmith, was ranked as lowest for customer satisfaction. Surveyors stated that stores were ‘cramped and messy’, also ‘staff members are very unhelpful’. There is even a Twitter account, @WHS_Carpet, which has over 26,000 followers, dedicated to exposing poor retail displays in a tongue-in-cheek manner; with the most popular culprit being – you guessed it – WHSmith.
This further proves that if you don’t provide a good experience for your customers, they’re likely to be dissatisfied; if they don’t enjoy shopping with you, they will either take their business elsewhere or look online.
So how can brick-and-mortar stores protect their business?
Recently, Tesco suggested that the government should introduce a 2% online sales tax in order to aid the disadvantage that businesses with physical retail space currently face by providing an incentive for shoppers to visit stores instead.
Most importantly, if online shopping became a premium to be paid for and shoppers did indeed rely more on brick-and-mortar stores again, this would provide more employment security and ultimately stronger communities.
As effective an idea this may be, unfortunately there’s nothing thus far to suggest this is being considered. However, we’ve put together a few tips that high street retailers can implement:
What keeps physical retail business afloat?
- Exclusivity – Providing a service or product that is niche will attract customers to visit your store, especially if it’s not something they can simply order to their door.
- Superiority – Like any industry, it’s important you stay determined to beat your competitors. If your competition is ahead of you in any kind of statistic, always take this opportunity to assess what they do different: Is their service quicker/friendlier? Are their locations better? Do they have a more accommodating store design?
- Keep up with trends – Don’t be too stubborn with tradition. All trades evolve and demands fluctuate, so pay attention to the changes in your market.
- Location – This may seem obvious, but now more than ever it is important to situate your business where it is likely to be convenient. This is why the amount of vacant stores on our High Streets is such an issue, if all the stores around you are vacant, people are less likely to stop by if they aren’t already looking for you. Relocation can make all the difference to your profits if you do so efficiently.
- Reputation – This ties in with brand awareness, whether your store has always been reputable for product quality, friendly service etc. or has struggled with certain statistics in the past or present, it is vital in this age to do everything you can to upkeep a good image. While this starts with the quality of your stores and the products & service offered, you can use other methods to boost the perception of your brand through advertising. Consider if/how you use Social Media to build a rapport with your customers.
- Click and Collect – If you can’t beat them, join them. While you may not want to conduct business online for various reasons (particularly the difficulties of a delivery service) click and collect enables your business to compete online as well as drive visits to your store. Furthermore, if your store layout is appealing enough, customers collecting their orders may be tempted to make some extra purchases.
At Retail Maxim, we keep updated with changes in the retail sector because we don’t want our clients to fall behind. For more information on how to prevent your store’s profits declining in the digital age, contact us.