I am very cross this morning, my tweets probably show this only too well. I’ve had 2 radio interviews to discuss recent findings from Local Data Company and PwC regarding the level of openings and closures for high street chains (in this case those retailers with more than 6 stores). BBC Radio Sheffield were charming, listened to my thoughts, asked intelligent questions. London’s LBC were really challenging, apparently hoping I’d be full of doom and gloom… let me explain what happened!
Opening Statement: More high street stores are closing than opening…
I was listening to the preview before the conversation and the presenter, Nick Ferrari, said “the report says more stores are opening than closing” – here the age-old problem of lies, damn lies and statistics was happening… The report says that “An average of 14 town centre shops a day were shut by store chains last year as shoppers increasingly desert high streets for online and out-of-town retailers. Multiple retailers with six or more shops failed to open as many stores as they closed last year for the first time since 2008, according to a study of the 500 biggest town centres in theUKby PwC and Local Data Company.”
However, only last week Local Data Company reported that the average shop vacancy rate in the UK was STATIC at 14.3% – well unless something is opening to match the closures then that would not have been the case… and, according to BIRA (British Independent Retailers Association) something is opening, that something is Independent Retail shops.
I started by making this correction and went on to say that the future of our high street would depend on new, entrepreneurial retailers filling the void.
Next provocative statement: Let’s get real, an art shop would never open in Hackney!
Well possibly not if the media keep telling them it’s an impossibility! At this point I was getting quite irritated by the interviewer – now I know he is supposed to be challenging and push on the buttons to get the points of view raised etc… but I was not impressed. I am determined to champion retailers and this really irritated me! After the riots I went to Hackney with Retail Trust and I know it’s a vibrant, lively community. Yes they have some issues, no one would ignore that, but there is no reason to be dismissive! Independent retailers don’t have to be expensive! What if a young creative person in Hackney got a chance with a special rental deal to open a shop to showcase their work? As a person in the local community they’d know what an acceptable price would be, they’d deeply understand their customer… Furthermore I completely believe that communities are very supportive of their local talent, they know that those who take a few risks and stick their neck out can bring a bit of prosperity back to an area. I felt furious on behalf of anyone in Hackney with a glimmer of an entrepreneurial dream as the interview had just mocked the possibility of such a business ever being a success.
His perspective was people don’t have the money, they need food, shoes etc… Indeed, and that’s why supermarkets, out of town and internet will always be with us – providing the “boring basics”. Our high streets may become the breeding ground for new businesses offering unique products for the local community – there is a place for both!
Market forces are turning homogenised high streets back into local, social, community places
Portas review and many others before her identified issues with UK towns (and Cities) becoming “clone towns” – each like the next, nothing special, nothing different. This means there is no real reason to go to a town, battle the British weather, pay for parking, carry the shopping because if there is nothing different then a shopping centre or online is easier and a more “controlled” environment.
It’s also well known that markets increase footfall to towns – whether they are regular weekly markets or speciality markets, ALL the retailers see an increase in footfall on market days. Why? Because consumers are interested in the diverse products and unique items that they can find on a market. The shopping experience is a delight to the senses and it’s friendly, fun and experiential.
That’s the clue… people ARE voting with their feet and retail is being forced to respond. As I said to BBC radio Sheffield – “This the natural evolution of our retail model to meet the demands of a changing consumer, the changes are the natural ebbs and flows of the industry as it repositions”. Towns with a vibrant, relevant, unique offer that attracts their local consumers are doing well. Towns without that are not BUT as the multiples migrate away from failing towns they leave gaps that new, risk-taking, fresh businesses may fill and in so doing the high street becomes less homogenised and returns to being more at the heart of the local community once more. Over time I really believe our high streets will revert to the mix of businesses consumers wants – and that won’t be exclusively retail – it will include leisure, services and things to do e.g. Kids play centres, cinemas, cafes and galleries. Each town will regain it’s personality… but it won’t happen overnight!
This isn’t nostalgia, this is facing up to permanent change in the way we shop that has been driven by the internet
This week, at the launch of the Rochdale High Street Foundation, I talked about how the internet has only been “transactional” for 18 years (in 1994 Pizza Hut launched online ordering and it was the first consumer proposition to offer that). The fact is that there has been a consumer revolution! The NEW consumer has access to the internet any time, any place, any where (thanks to mobile) and social media is part of their normal mode of communication. Retailers could consider that a threat, or they can embrace the opportunity. A friend of mine, Thomas Power, forecasts that in 10 years we’ll have Amazon or Independent retailers and that’s all… perhaps a bit overstated, but his point is chains will consolidate to a few mega brands and then the only place for choice and diversity will be independents. I don’t know if it will come to that, what I do know is that the internet drives transactional behaviours – consumers check prices and compare products for the lowest price deal. They’re not loyal to big retailers, they just want value. Independents on the other hand can drive loyalty through being 100% in tune with their local customer. Loyalty is based on trust. Thomas’ wife, Penny Power, says that in this new economy businesses must win share of heart before they can win share of wallet. She is right. And people don’t usually “love” chains the way that they do their “friendly, local independent”.
So, the consumer revolution leads to a high street evolution – one which is local, is social, and embraces mobile (Lo-So-Mo) as it is called – this is the future of the high street; it’s just going to be a slow and probably painful process to arrive there!
Finally: Don’t let the media gloom-mongers drag your spirits down!
Before I finish I wanted to share that the interviewer said to me “I thought you’d be sharing a really gloomy outlook” – and I did reply something about “bad news sells”! Frankly we can’t ignore the pain of the shake-up of the retail sector and the ripple effect it will have on the economy BUT if all we do is focus on gloom no one will stand up to initiate the changes required. I want everyone to be bold, brave and to take (calculated / planned / considered) risks. If you see an opportunity in your town where a retailer has closed down, explore it. Landlords do not want empty premises and it is the next generation of businesses, young start-ups, who will turn the economy around. If you think you can do it then find out more. You may be pleasantly surprised
It is proven that consumers WILL buy themselves treats in times of austerity – to bring a little JOY into their lives. They have less to spend but there is still money being spent. Make sure it is with you!