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Kent comment: Survival of the fittest on Britains high street
Debbie Kemp, Business Management Lecturer in Retail and Enterprise from Kent Business School at the University of Kent comments on the latest three retail casualties on the British high street and how retailers can hope to survive another year of trading.
She said: Retail is all about selling the right product, in the right place at the right time. Unfortunately the three major UK retailers who went into administration this week have something in common; they are selling products that are out-of-date with the needs of consumers.
Although Saturday mornings browsing through racks of CDs and DVDs in HMV or Blockbusters are fond memories for many, online retailers offer the same products often at a cheaper price. Other products are simply downloadable at home which is more convenient and often a cheaper alternative.
Bookshops on our high street could be the next to fail and certainly face the same pressures of immense competition from online retailers. Likewise, the growth of major supermarkets into non-food related products could cause further concern.
Some retailers are however bucking the trend. Ones that have embraced multi-channel retailing include John Lewis, Waitrose and Argos. Argos reported nearly half of their Christmas sales were made online this year, whilst ASOS - a high fashion on-line retailer - also reported record sales.
Others to buck the trend are those appealing to consumers with lower prices, such as Lidl and Debenhams. Debenhams started a 50% off campaign throughout December ahead of their competition. But it remains to be seen how this has impacted their profit results, released in April.
It truly is survival of the fittest in the current retail environment and only those that exceed customers expectations will survive this year - whether they are big high street names or small independents.
On the high street, stores need to give consumers a compelling reason to brave the congestion and ever-increasing car parking prices. Good value products sold in an engaging environment, combined with good customer service and knowledgeable friendly staff will still appeal to the 89% of customers who choose to spend money in a physical store. However for retailers this is not an easy task as business rates and rents continue to rise, and leaner, more cost efficient online retailers continue to grow and convert customers. Some may however find it surprising that still only 11% of retail spend is actually online in the UK.
A flexible approach to serving the customer which is still steadily increasing in popularity is the provision of ordering facilities and delivery options. Similarly, creating more social spaces in stores on the high street encourages consumers to visit and crucially stay longer. For example, Waterstones has introduced Costa Coffee shops in their stores to increase footfall.
Story published at 10:04am 24 January 2013
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