With the likes of Debenhams and House of Fraser facing difficulties, and more established players such as M&S and John Lewis struggling for sales and even issuing profit warnings, the British high street isn’t exactly buoyant at the moment.
Barclaycard’s data shows that the retail sector continued to struggle in October, with department store spending down 5.9% year-on-year amidst high profile store closures, while spending on electronics reached just 1.8% growth, below the rate of inflation. Clothing spending also declined by 2.4% – the biggest dip since October 2017.
In the face of difficult times on the high street, some retailers are responding intelligently to this downbeat environment by providing customers with more of a compelling reason to spend big at their stores rather than shopping online.
You can find a lot of inspiration from the grocery sector, with the discounters Aldi and Lidl continuing to operate from a strong position, largely thanks to offering an efficient, streamlined offer to customers.
Moving to smaller stores with limited stock gets rid of clutter and provides customers with more of what they want. Therefore, it’s no surprise to see M&S stripping out various sub-brands and products. M&S’s CEO Steve Rowe made shrinking the number of clothing lines a central tenet of his strategy and decreased store space devoted to clothing by 10%.
Providing customers with a compelling reason to return can also be boosted by offering one-off experiences. John Lewis is now looking to add special film screenings to some of its stores in the hope this will keep customers inside for longer periods of time.
Pop-ups can also be desirable. The car industry, in particular, has done a great job of utilising one-off locations to create sales opportunities, with Jaguar using its sponsorship of Wimbledon to offer a limited virtual reality experience at Waterloo Station featuring Andy Murray.
Utilising in-store technology
Arguably, tech is at its best when it simplifies or enriches the in-store experience. Travel agent Thomas Cook has stepped into the 21st century by successfully offering virtual reality previews of holidays to customers inside its branches.
Meanwhile, Barclaycard is simplifying the in-store experience by trialling our new Grab+Go technology. Big four supermarket Sainsbury’s has done something similar with its scan and go app, which also means you never have to queue for a checkout till and can just leave once you’ve selected your items by paying digitally. In one of our recent white papers, we looked at how training staff in the right tech can have a transformative impact on the in-store experience.
The reality is high street retailers can no longer rely on traditional sales. Thanks to the rise of the Amazon’s of this world, returning an item has never been easier. New research from Barclaycard shows that a quarter of retailers (26%) have seen a rise in returns in-store and online over the last two years, with the number of returned items up by 22% on average.
This has understandably had an impact on profitability. Therefore, making sure your store has alternative sources of generating revenues is imperative. Debenhams hopes it has got this sorted with a new trial of in-store gyms in select retail locations.
Whatever your approach, there’s no shortage of brands innovatively fighting against the current slump on the British high street.