This first ran here in the Huffington Post.
Not many industries can resist change for 50 years and still keep growing, so it is was a pleasant surprise recently that retail sales growth has returned.
Perhaps less surprising was last week’s news that only seven per cent of an innovation fund set up to help the high street modernise has been taken up.
It has become a common lament to hear the high street lick its wounds and complain of clone towns, the move towards out-of-town shopping centres and the rise of internet shopping. To this you can add the worst economic conditions in living memory. But pointing the finger is missing the point.
As the health of retail remains a key bell-weather of economic optimism, the return to growth is undoubtedly good news. It may signal a return of consumer confidence and perhaps a feeling that the worst could soon be over.
Celebrating last week’s good news too soon, though, could miss a few of the more important lessons.
The first, that the world has changed, is obvious. The need to think multi-channel and the need to find a way to coexist with the internet are both well-trodden paths. To thrive again, the high street must become more of an enjoyable experience that customers want to seek out.
In this context, individual businesses need to communicate more clearly with customers. They need to sell their “story” as much as the inventory of what they’ve got on their shelves. They are not just about products and price any more.
For the high street as a whole, one of the lessons from Mary Portas’ government review of the high street has been that united neighbourhoods can stand together more strongly. If a lot of businesses are working together to bring individuals in, they collectively benefit from the combined foot fall.
Perhaps more importantly though, the high street needs to review its competitive set and adjust accordingly. In other words, one of the paths less trodden in understanding the pressures on the high street is that everything really has changed.
Traditionally retail has been about Findus competing with Birds Eye and Tesco for our “fish finger spend”, or M&S persuading us to buy our T-shirts from them instead of Selfridges. In other words, retail has always competed with retail.
Now, as “shopping” has increasingly become a leisure activity, or experience, retail has to compete with every other leisure activity. Customers are no longer just deciding which store to buy their T-shirts from. The decision now may be whether to buy a T-shirt at all or to stay in and download a movie to watch on their flat screen telly.
Competition for the high street is coming from more than the supermarkets and the internet. It’s coming from everywhere. It’s time to step up and start innovating.
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