How the High Street has Re-invented its Proposition to Unite the Digital Shopper

“The demise of the high street”, “number of UK high street shops falling sharply” “is it the end of the high street?” are just a few of the headlines that have furnished the business sections of the nations broadsheets over the past few years with each article providing its own assessment and reasons but all seem to be in collective agreement when aiming the blame at the growth in users preferring to complete their purchase patterns online.

Indeed the trend to online purchasing is obvious. Forrester expected the overall UK online retail market in 2011 was worth £28.6bn, representing nearly 10% of the overall national retail market.

This growth has continued into 2015 supported by user adoption of mobile, smartphone and tablet devices migrating users away from the traditional desktop which not only has accelerated the rise of the “portable shopper” but has also opened up new digital channels for savvy retailers to interact with new audiences supported by a multi-channel platform strategy.

For retailers, the OFCOM Communications Market Report provides some fascinating insights in how they need to consider optimising their retail propositions (source: http://stakeholders.ofcom.org.uk/market-data-research/market-data/communications-market-reports/cmr14/)

  • 44% of UK households now have a tablet
  • More than a quarter of over 55’s using a tablet as their main computing device
  • Desktop PC ownership had dropped from 44% in 2012 to 35% in 2014

Global Web Index provides similar findings when in a survey of it asked: “which of the following devices do you personally own?”

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Source:  https://www.globalwebindex.net/

 

High Street fighting back

By differentiating it’s proposition from the growth in ecommerce, the high street has created uncontested market places which ecommerce has created for the high street to help it transform it service offering to UK shoppers. “There is an opportunity for the high street to unite the digital shopper with the physical world and use technology to enhance personal shopping experiences”.

Here are 4 key elements the High Street is using to re-invent their proposition to service the demands of the digital customer:

 

1 – Click and Collect –

Click & Collect provides the opportunity, convenience and speed of delivery for the customer to purchase an item from a store’s website and collect the item from their high street store, eliminating the need to take out personal time for of a courier service to deliver to your home address or having to deal with arranging an additional delivery slot and posting back returned items

The growth in click and collect is set to continue through to 2018 as the chart below describes.

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Source: http://www.e-commercefacts.com/background/2013/07/clickcollect-forecast-uk/index.xml

 

Econsultancy  have also reported that nearly two-thirds of consumers have bought products online before collecting them in-store

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Source: www.econsultancy.com

With the growing trend in more users using Click & Collect, Amazon have also created their own proposition called “Amazon Lockers”  which drop off points are used across UK shopping centres

 

2- Re-inventing Bricks & Mortar Stores

Digital brands are turning to bricks and mortar stores to help support their brand proposition and to also allow interaction with potential customers. The recession saw the emergence of a pop-up shop culture where short term tenancy deals were struck up with brands looking to cash in on seasonal demand peaks or location based demand.

Google have entered this market by running a concession in London called the Google Shop retailing their full range of devices

 

3- Same Day Delivery

One of the key issues for online retailers is the set-up of centralised warehouses which restricts the speed in delivery of products to customers. Brands that benefit from bricks and mortar have both an offline and an online presence can capitalise on this by turning their bricks and mortar stores into flexible warehouses to service the local customer and in turn provide same day delivery.

A number of start-ups have moved into the market to provide same day delivery services to support brands that have redefined their proposition to bring together a multi channel approach. Start-ups such as instacart,  deliv  and blablacar. There seems to be an appetite for this approach as Deliv raised $6.83mn to accelerate their growing service across US shopping malls

 

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Macy’s is a good example of this in how a traditional offline retailer has re-invented itself by supporting it’s online proposition in turning their bricks and mortar stores into multiple warehouses to service online fulfilment. This video  suggests a future will not be of pure-play retailers but of retailers who have an offline presence (to service speed of delivery, customer service) with their focus being on getting their products and services faster to the customer

 

4- Context Marketing

Delivering the right message to the right audience of users at the exactly the right time is becoming more essential for retailers to cut through the noise and attract their target audience. Contextual marketing provides the opportunity to make personal connections via high street stores through technology that delivers the right message to the right person at exactly the right time.

Described in the book, The Age of Context,  5 forces of context marketing were identified: mobile devices, social media, big data, sensors and location based services

Sensors – The rise in smartphone usage has meant new opportunities for physical stores to target the right audience with targeted messaging. According to a recent survey by Google, 84% of users browse their smartphone whilst shopping in physical stores, providing the opportunity for retailers to drive targeted messaging to individuals about a latest product promotion.

Mobile – Making it even more convenient for shoppers to complete their task in a shopping mall has been an essential ingredient for retailers keen to further enhance their proposition to customers. Starbucks recently introduced the concept of a mobile ordering payment system within their app allowing customers to walk to the front of the queue and pick up their coffee of choice.

Location – Mobile app based taxi company, Uber took the interesting approach of adjusting fares based on the weather at a given location

 

The rise of the “portable shopper” has opened up new digital channels for retailers to exploit and adapt their product offerings but at the same has meant an opportunity to bridge the gap between online and offline and provide a truly multi-channel offering.

 

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