Physical retail spaces have been on the decline for over 100 years; between 1950 and 1997, the number of shops declined sharply from 585,000 to little over 300,000, equating to a 49% fall (Independent, 2020). The lockdown, caused by the recent pandemic, has seen footfall on the High Streets fall by over 50% (BRC, 2020) so not only are there less shops available, fewer consumers are stepping out onto the High Street and increasing numbers of consumers are intending to continue shopping online.
Retail spaces have slowly adapted over the years and begrudgingly opened their doors to innovation, with the introduction of self-service checkouts in 1984; gaining popularity in the 1990s with the expectation of till numbers rising to 325,000 by next year (BBC, 2020). This comes at a cost. The introduction of self-service sees a fall in demand for employee headcount, meaning more employees out of work due to a rise in technological optimization and efficiency. Yet there also appears to be a shift in attitude towards retail therapy with shoppers revealing a preference towards the convenience of online shopping, as can be evidenced by the stagnant High Street, but demonstrable rise in overall retail sales (BBC, 2020).
Disrupters, such as the recent pandemic lockdown, forced change in consumer behaviour but such change has previously been seen. A milk float, for example, is no longer a common sighting but has remained a viable business practice for the iconic milk bottle to be delivered straight to your doorstep, as well as the introduction of a variety of alternative flavoured milk and dairy-free alternatives (Milk and More, 2020). A rise in demand for doorstep deliveries from milkmen and women has been seen as an alternative to supermarket online delivery slots and in-store visits (BBC, 2020). However, gone are the days when you can have a friendly chinwag with your local driver; replaced instead with delivery drivers making desperate attempts to “deliver” to meet stringent targets; leaving parcels in plain view on doorsteps, wedging parcels through cat flaps and even hurling packages through open first floor windows (This is Money, 2020).
Perhaps the increasing pressures placed on the High Street as a result of COVID-19 were simply a well-needed wake up call to shake up existing practices and encourage retailers to reconsider the in-store customer experience. British Retail Consortium have partnered with Validify to assist retailers in reinventing their stores to appeal to the “modern shopper” (British Retail Consortium, 2020). The impacts of COVID-19 have not been the cause of this shake-up, but have most certainly caused an acceleration. However, this does not necessarily mean that the death of the High Street is in sight; retailers may simply need to step up their game. For example, Primark, a fast-fashion retailer, could be considered to be one step ahead whereby the shopping experience on offer has reached a whole new level; 5, to be exact! With the grand entrance of Primark Birmingham High Street, you can pick up a new outfit, grab a bite to eat, razzle and dazzle with the latest hair trend, whilst picking up a Disney themed onesie for your friend’s baby shower and a Harry Potter inspired gift for your neighbour’s birthday. If you or your phone needs a recharge, you can relax next to one of the many water fountains for a boost of energy, whilst plugging in your mobile device (Birmingham Mail, 2020).
Companies, such as Primark, who are willing to adapt and respond to changing customer behaviour seemingly will be the ones who thrive. Other retailers have also set out to redesign the customer experience. For example, Furniture Village recognised that consumers disliked queuing, so quickly introduced an appointments-based system, and Sofology and Signet Jewellery are seen to be utilising advances in video technology to allow face-to-face conversations between its sales representatives and its consumers (British Retail Consortium, 2020) allowing consumers to have the same experience from the comfort of their homes.
However, it is unsurprising that the British public is confused. One minute, the Prime Minister is telling us to stay home, next he is telling us to go out. On the one hand, households are encouraged to have a financial buffer of three months’ worth of essential outgoings (Money Advice Service, 2020), but on the other hand retailers want us back in the shops to take advantage of the sales traction from impulse purchases (BBC, 2020), whereby shoppers needlessly purchase items which are neither needed nor essential, despite growing unemployment rates and falling incomes.
Although the High Street diminishing has seen the introduction of digital transformation, there is a concern for millions of people’s pensions and savings which are tied up in commercial property across the country. As of 2019, M&G Property Portfolio, a leading asset owner and manager, had investments in 91 UK commercial properties, ranging from shopping centres to retail properties (BBC, 2020). With a fall in demand for commercial space to house a retail outlet, commercial property is left abandoned, unwanted and its valuation crippled causing rising fears that long-term financial security is being wiped out. As a result, in August 2020, trade bodies were asking for further Governmental support in the form of a Property Bounceback Grant; the scheme would provide rent support to businesses whose income was wiped out due to coronavirus, fearing that without such support many of these businesses will disappear. It is expected that such a scheme would cost £1.75 billion, and would save 375,000 jobs and generate a 400% return in tax revenue resulting from the creation of economic activity (BRC, 2020). However, such further support could unintentionally encourage businesses to stagnate, whilst relying on governmental support, instead of seeking new ways to operate and adapt their business models to accommodate the changing consumer behaviour. The High Street was struggling pre-pandemic and so perhaps it is time to be out with the old and in with the new, making room for innovative, pioneering new businesses.
Businesses now, more than ever, need to remain agile and seek to provide products and services that the future consumer will want, as opposed to developing products and searching for ways to sell that product.