“Retail is not dying, only boring retail is dying”. So said Christopher Cuvillier, CEO of property company Unibail Rodamco, owners of Paris’ Les Quatre Temps shopping centre which last summer acquired Westfield – best known in the UK for its two eponymous London malls.
He has a point. News reports of last year’s high profile retail failures were often accompanied by vox pop clips of shoppers commenting on dreary interiors, dull merchandise or lack of helpful staff.
Competition from online sites is generally blamed, but – while the figures obviously vary markedly between product sectors and individual retailers – over-all, online currently accounts for around 17% of total UK retail sales with forecasters predicting a 20–25% share within the next two or three years. That still leaves the vast bulk of retail turnover in the physical world, and those retailers that are continuing to thrive have not only embraced omnichannel, but are revamping their stores to enhance the customer encounter, make imaginative use of digital technologies and integrate social activities and leisure into the entire shopping experience.
Book shops were among the first to suffer from the Amazon effect, but the survivors – including many independents – do so by providing additional services that deliver new experiences for customers. While many have added coffee shops and reading areas, Beerwolf Books in Falmouth combines its bookshop with a pub and a programme of events which includes a ping-pong tournament. One Tree Books in Petersfield also stages numerous events, such as book signings, literary talks and poetry readings, and it hosts a monthly book club (complete with glasses of wine for attendees). In Munich, Hugendubel has rearranged its books into lifestyle themes such as “Immerse yourself”, “Learn, play and make” or “Horizons” instead of the usual genres. Its first floor café has an open kitchen where cookery books can also be found, while a sound-proof room allows for the quiet enjoyment of a good read.
Among the chains, Waterstones has moved from near total collapse in 2011 to healthy and increasing profits – up by 80% in its latest financial year. Key has been a new focus on localism with branch managers given free rein to select stock appropriate for their customers, rather than apply the “one size fits all” offering familiar in many multiples. High profile events – such as its popular Harry Potter nights – have also helped, as do the enthusiastic and knowledgeable sales staff.
While in-store events can build traffic and improve the customer experience, in an omnichannel world, shoppers also expect any store experience to reflect the ease and efficiency of buying online – which is central to Farfetch’s “Store of the Future” project, currently at the beta-test stage at stores in London, New York and Paris. Luxury fashion marketplace, Farfetch bought Browns – a long-established London boutique – in 2015 with the aim of creating a “pioneering mix of technology and in-store experience”. For Farfetch founder and CEO, José Neves, “The vision is to answer the question, ‘how will people shop for luxury fashion five or 10 years into the future?’ This won’t be purely online,” he said. “The answer, we believe, will be a seamless merger of a fantastic physical experience with powerful, yet subtle technology.”
The key starting point for “Store of the Future” explains the project’s CEO Sandrine Deveaux, is the ability to identify customers when they enter a store so that staff can greet them by name and instantly have insights into the sort of merchandise likely to interest them – just as happens online. Luxury brand shoppers spending thousands of pounds “want to be recognised” argues Deveaux, and can be extremely disappointed if they are not. The proposed solution, the “Farfetch pass” is currently being developed using five different technologies. The pass and other test technologies are all about enhancing the shopping experience rather than using technology for its own sake.
There is the connected rail, for example, which uses RFID and ultrasound to send images of any garment a shopper takes from a rail to examine, to the customer’s smartphone as a reminder of products that interested her. The connected mirror in a changing room allows the shopper to send requests for different sized or additional garments while sales staff can also use it to display possible add-on purchases. The mirror can even take card payments and arrange home delivery – solving another of Deveaux’s pet shopping hates: “It takes too long to pay,” she says, “you want to leave the store and move on to the next experience not queue to pay and then have to carry all your packages away”.
While such futurist developments may succeed for some, they are unlikely to dominate tomorrow’s high street. Joshua Bamfield, Director of the Centre for Retail Research, believes that “It’s more about what you can do with a mobile phone to enhance service than introducing high-tech. Maybe the ability to phone ahead to reserve a car parking place or alert the store that you’ll be arriving in 15 minutes to pick up an order will prove more attractive enhancements”.
It’s an approach which Debenhams is adopting as it battles its current financial problems. “Our customers are not just looking for product but for leisure and food,” says Ross Clemmow, MD of Retail, Digital, Food and Events, “and we believe we can be a good host for these activities.” The plan involves levering a shopper’s smartphone to integrate service activities – such as beauty salons or wellness advice – with retail activities like click and collect.
This could see a busy customer, for example, having their click and collect order brought to the beauty salon during a lunch-time nail bar appointment or prebooking a changing room to try on the dozen dresses reserved online rather than take them home and then have to return most of them. As Clemmow says: “Mobile can speed up the process”.
Forecasters have long predicted that online shopping would be the death of many of our high streets as multiple chains close unprofitable outlets in secondary sites, but as Professor Bamfield points out, the high street is merely a “micro-economic aspect of the surrounding area”. Those that are failing generally reflect problems in the rest of the town, so there can be no quick turnaround to restore prosperity. Positive action by local authorities can be vital: such as Bolton Council’s purchase last June of the town’s failing Crompton Place shopping centre as part of its long term plan to regenerate the town centre.
Successful high streets generally combine strong independents with additional resources that provide a reason for shoppers to visit them. “Typically”, says Bamfield, “that was the bank; but the banks have been closing branches so the high street has to provide something extra that cannot be bought online – fresh local produce, perhaps, or various personal services”. The list could include hairdressers, a dentist, pharmacy, library, restaurant, or pub, as well as newer models providing additional services to encourage greater footfall.
Perhaps we shall see the advent of clothes shops acting as click and collect centres for fashion multiples while also offering complementary ranges, alteration services or acting as secondary sellers for any returned merchandise. Maybe pharmacies of the future will combine health centres or satellite surgeries for suburban GP practices or tomorrow’s gift shops equipped with gallery space for exhibitions, a mini-cinema for art films or innovative pop-ups?
Online shopping is quick, easy and efficient – but a real world store also providing social interaction, personal service and novel experiences can be a successful competitor: just as long as it is never “boring”.