It seems that a week does not pass without another high street brand announcing profit loss, store closures or job cuts. Household brands that have graced the high streets of the UK for decades such as Woolworths, Toys R Us, Phones 4 U, British Home Stores, House of Fraser & Homebase to name but a few, have fallen victim to changing times. Footfall is declining, our spending habits are changing, and the willingness to embrace technology by consumers has led to these corporations restructuring and cutting costs in an attempt to reverse their sharp fall in profits.
The main challenge for the high street comes from E-commerce stores such as Asos, Pretty Little Thing, Gymshark, Wish, Boohoo, Ocado & Jacamo who operate online and incur a fraction of the overhead costs resulting in year on year profits and growth. These E-commerce stores provide convenience by allowing us to purchase from the comfort of our home or office at a more attractive price including free next day delivery thus avoiding traffic, travel & parking restrictions, saving us time and money, all this accompanied by a larger selection to choose from 24 hours a day, 7 days a week. E-commerce stores have also adopted social media platforms like Facebook, Instagram & YouTube as their preferred method to market their products and services. Traditional advertising methods such as television, radio, and publishing, although serve their purpose, are becoming less cost effective and less engaging. The ability to target a more specific audience on these platforms at a fraction of the cost means a higher return on investment.
This leads us to question why the world’s largest online retailer Amazon, is determined to add Bricks to Clicks. Since 2015, Amazon has trailed various concepts including their highly anticipated Amazon Go – physical stores where shoppers scan their mobile phone upon entry, grab desired items off the shelf, and automatically get charged the right amount after exiting without the need to queue and pay at a cash register. Amazon is hoping that by making convenience store trips even faster, it will raise the bar and make it more appealing for customers.
Our high streets are suffering but the term “Death of the British high street” for now, seems extreme. What we can be certain of is that the landscape is changing, and fast. Brands such as Utilita, Tesla & Dyson are opening stores albeit in small numbers, and retailers such as Zara, Primark & Screwfix are thriving due to their combined online and offline strategies and customer loyalty. Struggling retailers need to adjust and embrace changing markets or risk becoming yet another casualty of modern times.