As John Lewis announces £1 billion of online sales, what does that mean to the High Street?
Our offices are on a High Street, and we love it. So it always gets our attention when a new statistic or observation comes out about online sales or struggling retail stores. And whilst we are have facilitated and released several eCommerce stores, you can’t help but take a moment to wonder about how things have changed – and where it will all end up.
And for me, the release of this latest milestone from John Lewis is perhaps more pertinent than most, because John Lewis is like a complete High Street all under one roof! And if shoppers generated a billion pounds of sales online in 12 months, this would indicate more and more of us are walking the High Street from the comfort of our home or workplace, and with our trusty iDevices (25% of all JL web traffic was via Smartphones!)
In fact, more of us are shopping online than even John Lewis’s thought, having reached £1bn mark a full twelve months sooner than predicted! So there are few other stats that perhaps underline the shift in our shopping habits more than this one, or present such a chilling portent for those left trying to compete.
“Online sales are booming”
John Lewis is not alone it’s enjoying unprecedented sales. Debenhams is up 46% and others big names are releasing similar increases. Even Tescos has recently abandoned plans for 100 HyperMarkets because the huge retail floor spaces just cannot pay for itself. It’s focusing instead on it’s online business!
So does opening an online store mean similar success for anyone? Well, no. Because nobody seems to mention there are just as many online shops who are struggling in the face of competition from Amazon (and the Supermarkets!) etc. So it’s all very well to say online is the way to go, but it seems only for a reasonably select few. These giants are the ones spending gazillions on marketing, where £1m per month on Pay-per-Click is not unheard of. Plus offline and TV marketing to boost their everyday reach and awareness.
But I don’t think it’s that alone. I think these companies do so well online because they also have enormous physical stores in centres across the UK. This gives us confidence – the best of both worlds if you like. We get online pricing and convenience, plus a nice shiny big-brand store to take it back to if all goes wrong. It is that consumer confidence and offline presence that other online stores can find it hard compete with.
Where will it end?
So is this a really that scary or surprising, or just the natural evolution in our multi-screen world? Because we are not talking about a distant future in a far off place, where stores are ‘how we used to shop when I was a lad’ – but here and now.
I saw a friend of mine on Sunday walking along the High Street, and we agreed that one day in our lifetimes we will probably walk down this same High Street saying things like ‘remember when all these houses were shops! You know, when you could actually go inside the shops and touch things..’ (or park anywhere near them!) The really sad fact is I assume the shops will all go back to being the houses they started off as. As much as we may all lament and crave our High Streets, or fondly remember the markets and bustle, we are seemingly hell-bent on making it impossible for them to survive. Add to this ridiculous council rates and red tape, inflated rents, the inability to buy big and the ever increasing war on cars – what possible chance have they really got?
Physical shopping is, well…a bit physical for some people.
Online shopping is not an evil curse. The ‘problem’ is, it is often amazingly efficient and effective. Who has time to drive to town anyway, right? Or to carry heavy shopping bags around a five-acre supermarket car park in the rain, packing it all the boot and pausing only long enough before leaving to observe the new ding in your car door courtesy of the only other person shopping there (who parked three inches away from you in an otherwise empty car park).
And it doesn’t end there. Even the determined urban shopper is forced to navigate pedestrianised town centres, ridiculous parking charges and over zealous traffic wardens. Online retailers have no such worries. They are busy ramping up their schedules to fit our business lives. Is it really any wonder we are looking elsewhere?
Evolving to fit our changing lives
Online shops don’t down the shutters at 5pm, they fit into our hectic schedules and into our ‘me’ time. The dog’s walked, kids in bed – what better way to relax than to shop on the sofa with a coffee!? And by running three 8-hour shifts, fulfilment centres mean our late night orders can arrive before breakfast next day – almost quicker than parking in some places! It’s actually impressive. And of course, these stores and centres stimulate the economy, provide jobs – some even pay taxes!
Nice Market Town! But where am I?
I suspect this is why Market Towns throughout the UK are all starting to comprise of the same shops or businesses, who in essence are left to providing things you can’t easily get done on the Internet! Nowadays, you could be dropped in any market town in England and, aside from a few specialist stores and differing architecture, they all look the same.
You can’t get your hair cut on the Internet, or buy a house, get buried, eat a coffee & sandwich or meal, buy medicine or grab a pound store bargain there and then. Which is why, apart from the occasional Bank that can absorb the overheads and the Charity shops that don’t have to, almost every High Street that is still active now consists of a combination of hairdressers, food outlets, estate agents, funeral parlours, chemists and pound shops. In a play on an old credit card slogan: for everything else, there’s the Internet.
Browse in-store, shop online!
There are always strong and valid arguments for and against your standard shops. I love our High Street, but confess I shop mainly online even though I am witnessing its decline right in front of me (3 shops have closed this last quarter alone). And a recent survey said up 36% of people who do go to the shops, ultimately complete their purchases online anyway! They just go to have a look before searching online for the best price or most convenient delivery slot. In some cases, we do seem to like that tactile experience if we can get it, just not enough to make the trip or complete the purchase in many cases. Argos kind of bridges the gap, or tried to, with a catalogue replacing shelves of goods. But now even they are bringing goods out to the shop floor, perhaps to make a potential visit worth while? And I know of retail, shopping-centre based stores whose staff spend most of their day wrapping Internet orders up. Safe to say, they will not renew their leases when the time comes.
So is the time for debate is really over? Aside from street-food markets (you can’t eat online yet) it seems the masses have voted, and no amount of discussion alone will stem the flow. Ultimately, as shoppers have we already voted with our feet? Evidently we prefer shopping for slippers whilst still wearing them!
Can it Evolve again?
I hope the High Streets themselves choose to evolve and come back fighting. But they are going to need help – and a lot more than a visit and soundbite from Mary Portas. As our habits changed, the Internet evolved to serve them. Can the High Streets do the same? Because the community is not served by online stores. High streets should also be where we go to meet and chat and catch-up, to socialise and renew connections and relationships, and feed our own communities with more than simple transactions.
So before we add another thing to our virtual shopping baskets, let’s perhaps consider where we will experience and enjoy all these other interactions if the High Streets disappear…