News Retail & B2B Comms

High Street Woes?

High Street Woes?


Our Head of Retail  Comms – Suzanne Surridge, shares her views on the current state of the nation’s High Streets.

Mike Ashley’s had a lot on his plate this week with a Sky Sports interview sparking a swarm of speculation around the sale of Newcastle FC and on Monday he was in Parliament, discussing how to save the British High Street. I do enjoy football but as Head of Retail Comms at Cirkle, I am definitely more interested in the latter.

During his presentation at the Communities Select Committee hearing, Mike littered his speech with references to the fact he is in fact not God (who knew?) or Father Christmas (topical), leading to some witty Twitter repartee.   Amongst all that, he made some interesting points: “It is not my fault the high street is dying; it’s not House of Fraser, not Marks & Spencer or Debenhams’ fault. It is very simple why the high street is dying. It is the internet that’s killing the high street,” he said.

The tale of gloom from Britain’s High Streets: It’s certainly been a very tough year for retail in the face of the continued e-commerce competition, deep discounting and mounting property costs and with consumer confidence at its lowest level in almost a year, many stores are struggling to sustain profitable sales.  Tumbling profits accounted for a string of bad news from department stores, including 408 job losses for Fenwick, Debenhams set to close stores and The John Lewis Partnership announcing a decline in profits. House of Fraser was bought out of administration by Mike Ashley but on Monday he admitted that whilst he was trying to keep 59 stores open, it would be impossible to retain them all.  Home improvement stores have also been badly affected with The Times this week reporting that Wickes will be sold off or rebranded to a trade store like its sister brand Toolstation, according to analysts. B&Q also reported a 2.9% drop in like-for-like sales and Homebase has shut 40 stores with the loss of 1,500 jobs.

Proposed tax on online retailers:  To help breathe life back into the High Street, Ashley suggested that retailers with more than 20% of sales online should pay a 20% tax on those sales and this would force existing retailers to invest in High Streets. Indeed, in August Chancellor Philip Hammond admitted he was, ‘strongly considering’ introducing a so-called “Amazon tax” to try to rescue struggling retailers.

Don’t underestimate the personal touch: Given that online retail is dominating, let’s take learnings from there. A survey by Which? found that the most highly rated online shops were specialist retailers and the popularity of these sites underlined the importance of offering a personal, convenient service that gave, “shoppers exactly what they want”. I immediately thought of the nation’s thriving convenience stores, with sales of £38billion last year and the number of shops rocketing. The success of these stores is because they offer that personal touch, with the chance for a chat and a friendly exchange.  Our  ‘Retailer Inner Cirkle’ – a community of independent and convenience retailers – enables us to interact with these retailers on a regular basis to gain valuable insight about them, and their shoppers, which we use to feed our strategic comms campaigns for our B2B clients in the FMCG sector.

Provide an experience in-store: Research from Criteo showed that 40% of UK shoppers want more than a trip to the shops and tapping into this, retailers are now combining shopping with lifestyle experiences to increase sales. John Lewis unveiled its second Beauty Studio in its Cambridge store and Debenhams introduced a new store concept to ‘make shopping fun again’.

In September, our client Morrisons announced first half sales up 4.5% after its strongest quarter for nine years.  Its ‘Market Street’ fresh food concept has been a vital contributor to this success with its sense of theatre, as has been our PR which has been a proven footfall driver when supporting NPD and product innovation at strategic times.

So the answer for bricks and mortar retail?Make your store a destination and add value; make it an experience where people can have personal interactions and spend time and inevitably, money. A store offers the chance to see, feel and experience products in a way that you just can’t get online. Done well, stores can be an invaluable marketing tool for the brand AS WELL AS driving online sales. Even e-commerce goliath, Amazon, buys into this with the launch of an experience-led, pop-up fashion store in London in October. They used the store as an experiment to gather insight as they understand that, ‘with fashion consumers love to touch and feel the product.’

It’s encouraging to see our big high street favourites starting to adapt their offering to suit changing shopper needs. Plus, retail innovation and tech are constantly bringing new and exciting concepts to the fore, so I’ll be very interested to see how the retail landscape evolves in 2019.