Although the UK high street is undoubtedly under pressure, figures from two of the UK’s largest landlords this month showed that premium retail locations are still bringing in high rental yields.
While secondary and tertiary positions are seeing significant vacancies, so much so that we hear figures suggesting over 20 per cent of some UK high streets are lying empty, there are significant differences at either end of the market.
The headline locations that major retailers, and brands that have become retailers, wish to occupy are still in demand, and those retailers are still paying the high rents associated with them. We can conclude from this that there is either some immediate commercial return on this investment or that the tenants see some auxiliary benefit from being there. That could be the ability to provide consumer experience in a fantastic venue or it could be the profile that a primary position can bring to a brand.
As discussed in previous columns, there are success stories out there (Waterstones, John Lewis, H&M) but you only have to take a walk along the high street of any town or city and you’ll see the very familiar collection of empty units, charity shops, mobile phone stores and bookmakers.
Beyond those sad facades, you’ll find some familiar respite in the multinational chains that show up around Europe and the world. In terms of appearance, these identikit stores can certainly give us some direction as to what our consumers are looking for; they don’t become universal without offering either desirable products or great service or both.
We can learn from those stores, of course, but we can also observe what they are and attempt to be different. Our independent stores can offer an alternative to this global homogenisation through individual presentation along with product and domain knowledge and a consumer centric experience.
We can identify our own independent champions too. There are new speciality doors opening - or existing ones refitting - who are taking the feel and atmosphere of high end (dare I say cool?) stores and using that as the inspiration for layouts and presentation style of run and sport specialty. Particularly in major cities where our new consumer prevails, why shouldn’t a running shop take on the premium feel of fashion or other consumer goods? If the consumer is happy in that environment, and feels that the products and services available are suited to the premium feel of the store then he may also be prepared to dig deeper into his pocket for the right product.
The trend for clean, minimalist retail environments can also be low cost, and flexible enough to feature the experiential side of our industry with, for example, three-camera gait analysis and insole customisation can easily find a home inside such a store.
Every runner or sportsman wants to be a little bit better than they were yesterday. The right product and the right presentation of that product can help them feel they can be a little bit better, if they invest in that product. And honestly, if we do our job right, we’re not just selling them a dream, we are selling them a reality. The right product can make a runner a little bit faster or give them the capacity to train a little bit harder.
Conversely, a whitewashed slatwall behind rows of side-on shoes is no way to merchandise in 2017. This prescriptive presentation is both tired and ineffective. Displaying product in a more imaginative format can not only help sell a product in the first place, it can lead to add-on or future sales.
Great presentation will introduce the consumer to different products, and also to different conversations around those products. It can enable us to differentiate between product silos and brands. We can use clever presentation to introduce a different category to a runner, to show them a trail shoe or a racing shoe. It’s also possible to use colour to tell a story and to “shop a look” as our digital friends do so well.
We can even reference the allpowerful supermarkets and the techniques they use to maximise sales and to generate add on purchases. My favourite example of complimentary merchandising was in Tescos where packets of headache tablets hung happily in the drinks aisle alongside bottle of wine and beer! Maybe our alternative is to put blister plasters next to packs of comfy new socks, or earbuds and phone cases next to the shoe wall?
Let’s not just see the high street as a threat or as competition. We should embrace their ideas and respect their success. As the proverbial nation of shopkeepers, retail is one of the UK’s greatest industries and there are so many examples out there of good and bad.
To win, we need to be the same, but different.