The High Street Revolution
As we slowly but surely begin to come out of lockdown, we can start to take stock of the damage that the Coronavirus crisis has caused. The fashion sector has been arguably one of the hardest hit, and with sales down almost 35% compared to last year, it's not surprising that many businesses have been forced to enter administration, including even major names like Debenhams, the Oasis & Warehouse Group, Cath Kidson & Laura Ashley. It's estimated that 20,000 stores which closed their doors at the beginning of the crisis will never reopen. But is the current crisis solely to blame for these closures, or was it just the last straw for a fashion retail industry already on the brink?
The outlook for 2020 was pessimistic from the beginning, with 2019 the “worst year on record” for the UK high-street. This downward trend reflected a change in consumer habits that has only been accentuated by the quarantine rules, and may signal revolutionary change to the high street as we know it.
79% of British adults now own a smartphone, and with the internet always at hand, it's easier than ever to order online. As stores remained closed, those retailers which already had a strong online presence were able to shore up their losses, but high street stores without an e-commerce option (TK Maxx & Primark being the most notable among these) have had to face 2 months without the possibility of making a single sale. And although non-essential stores are now beginning to reopen, consumers are likely to continue to be wary of shopping in busy stores as they once did and will rely more than ever before on e-commerce options. Industry experts are looking to China as the clearest point of reference regarding what changes we can expect post-coronavirus, and it's clear that innovative e-commerce solutions are leading the way in retail recovery there, including responsive mobile apps and social media sales – particularly on Instagram live. In order to survive into a post-coronavirus society, brands and retailers must prioritise their online presence, with brick-and-mortar stores serving as a supplementary service for those clients that prefer a more traditional shopping experience.
Over the past few years it has become a common sight to see To Let signs and empty store fronts in otherwise busy shopping districts, particularly the large retail units. Indeed, in the first half of 2019 a staggering 12% of shopping locations were left empty, the highest level since 2015. Major department store chains like Debenhams had been struggling for years, while House of Fraser was bailed out by Sports Direct owner Mike Ashley just a year ago. But why this change? Department stores had been a staple of the UK high street since the opening of Selfridges in 1909. The problem seems to be a combination of the rising cost of retail space and business rates, coupled with a change in how consumers look for fashion in a social media influenced society. No longer do customers visit major stores to browse the latest trends or shop for that must-have item. Consumers are now exposed to fashion trends via viral influencers and are more likely to shop for a unique or limited edition piece available from a small independent retailer than go for mass produced aspirational products. Plus, with trust in big brands declining due to a lacklustre response by many towards climate change and more recently the black lives matter movement, it would seem that smaller boutique stores may be the ones to pick up the slack as the big retailers begin to fail.
Innovation and Customer Experience
Even before the crisis, high street retailers were looking at new ways to entice customers back to their physical stores, prioritising customer experience and innovative services. At the vanguard of this movement is Sephora, who over the last 3 years have been combining the latest technologies with personalised customer service to create a flawless online/offline experience. Although some innovations may need to be postponed due to the new social distancing regulations (including on the spot point-of-sale services instead of cash registers), others such as in-store same-day pickup for online orders, or interactive mirrors which allow customers to try on products virtually, could be examples of the types of innovation that retailers will need to implement in order to survive in the post-coronavirus world.
The future of the high street is is not what we once thought it would be, and Coronavirus has hit fast-forward on the changes that were already beginning to be felt. As consumers slowly return to the “new normal” it's clear that the smaller boutique-style stores which offer a fluid online/offline service and enhanced customer experience will be the new leaders in high street retail. Change in times like these is inevitable. The retailers who are able to move with the change and capitalise on what the public wants will create the high street revolution.
Written by Amber Domenech