RETAIL RENAISSANCE Part 2: New Retail Landscape 19th May 2021
At the end of the Middle Ages in Western Europe, the Renaissance emerged as an opportunity for new knowledge, techniques, and icons. Leaders were those who pushed into uncharted territory, disrupted the status quo, and created a vibrant culture of creativity and experimentation. With the UK high street decline reaching a fever pitch, it is time for a change.
A radical new vision will be required to redefine the role that high streets play in our lives.
While the future remains uncertain, people still crave enjoyment more than ever. Our recent research across leisure, retail, wellbeing, and hospitality, heightens this sentiment. Changes in consumer behaviour combined with the impact of technology and the effects of the pandemic have also rapidly affected the speed of change. Below, we explore the issues behind this retail apocalypse and the emerging solutions.
New Retail Landscape
In today’s hyperconnected world, convenience is the ultimate currency. Getting what you want, where you want, when you want – faster & smoother.
The current health crisis has accelerated this. With further onboarding of older generations seeing 30% of online grocery shoppers over 55 being first-time customers (Accenture, 2020), expectations around convenience will continue to rise. It is undeniable that retail today is led by a shopping journey that merges online and offline touchpoints.
After all 82% of customers consult their phones on purchases they plan to make in store. It’s a given, physical stores will have to seamlessly incorporate digital features to elevate the in-store journey and consistently consider ways to provide convenience.
Whilst brick and mortar cannot compete with the convenience and breadth of choice available online, it can, better cater to the human senses and offer a different set of experiences. With 81% of shoppers globally are willing to pay more for a better experience (Westfield, 2020) and 74% of UK millennials still prefer physical stores to online shopping (The Convergence Continuum by I-AM Shift, 2019).
However, retail is only part of the picture and it will become an increasingly smaller segment in the future of the high street. With the rise of online purchases, much of the commoditised retail landscape has become redundant.
It’s indisputable that the likes of Amazon have had an enormous impact on the UK High Street and have been able to profit from the lockdown measures. Since the start of 2020 the worth of the Amazon empire is estimated to have increased by more than half (Guardian, 2020). As expressed by retail analysts Natalie Berg and Miya Knights, “Amazon wants to be a supermarket, a bank, a healthcare provider and, by the time you’re reading this, it will probably be on the cusp of disrupting at least one more industry.”
Ironically, the emptying of the UK High Streets is creating an enormous opportunity for online centric brands such as Amazon, Ebay, Depop and even fitness company Peloton; allowing them to create a perfectly blended customer experience, by adding physical stores to match their digital retail mix. The shift to cross-channel experiences is largely driven by the data captured online, and brands will recognise how a physical presence can improve exposure and loyalty.
As we can see with the likes of Amazon 4 Star stores, Peloton’s new flagship studio in Covent Garden and pop-ups such as e-bay’s UK pop-up store hosting its small local business sellers, or online beauty brand such as Glossier that launched its immersive pop up store in London and had record-breaking footfall. We’re even seeing bold new concepts such as Farfetch’s launch of “Store of the Future” combining augmented reality shopping experience, emotion-scanning software, innovative payments solutions to bring together online and offline worlds. The blend of channels by using the best of both will pave the way for what to expect from the future of retail.
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