‘Wild Wednesday’, hot on the heels of Black Friday, has seen shoppers flocking to newly opened stores, but as the collapse of Arcadia Group, Debenhams and Bonmarche within three days of each other shows, retailers can no longer rely on physical retail to see them through.
In fact, one of the main reasons why Arcadia is said to have failed is that it simply didn’t take the threat of online from the likes of Boohoo – now a suitor set to potentially pick up many of Arcadia’s brands at a bargain price – Missguided and Asos seriously enough.
For Arcadia, relying on a predominantly physical retail presence not only hampered it during lockdown, but also saddled the company with a hugely expensive property bill. It also set the company up to fail whenever the online revolution came. Coronavirus hastened that, but it was coming anyway.
So, what now for retailers as physical retail teeters? Online has come to the fore with the world on lockdown, but it too has to adapt if it is to survive. Right now, consumers face a conundrum: shop opening is unreliable at best and potentially visiting retail locations is a health hazard; however, online can’t match the ability to browse, see, hear, feel, touch and taste.
Consumers are also increasingly worrying about the environmental impact of increasing levels of delivery from ecommerce.
Online may have helped some retailers through the pandemic so far, but ecommerce is going to have to make some substantial changes across 2021 to make it fit to fill the gap that the high street will leave.
Mobile is likely to play a key role in that process. This year’s Black Friday has seen some 50% of ecommerce traffic come from mobile devices, again demonstrating that not only are consumers switching to online faster than ever, they are doing so via their handsets.
John Lewis, for instance, is winding up its cross-border operations, but is at the same time trialling using Pinterest to market and sell – predominantly through mobile – as it looks for new channels to market.
Mobile is also opening up the ability to make ecommerce highly convenient, while sitting at the nexus of online and the physical world, making the high street safer to use and thus making physical retail work again.
What is clear is that something has change with retail, both physical and online, to make both work for the consumer and to work together.
Back in the 1980s, the UK’s manufacturing industry pretty much collapsed, unable to compete and no longer the global colossus it once was. Many of the sites where factories, foundaries and steel works stood were knocked down and redeveloped as ‘enterprise zones’. These zones were snapped up by what we call today entrepreneurs and property developers as the UK shifted to a service industry economy from a primary manufacturing economy. At the time it looked like carnage, but looking back from 40 years distance, maybe it had to happen. It brought us huge retail parks after all.
Perhaps now, all these years later, those physical retail parks are facing their 1980s moment, but maybe technology can be used to develop these sites so that can enter their next era and not have to be demolished. I like to think that in those 40 years we have learned something.