One of the reasons we at Impulse love this industry, is the everchanging shape of it.
Although Covid has forced more change than we could imagine, one of the biggest impacts has been to the High Street.
The clearout of some of the largest chains, plus a number of smaller retailers has left a space too big to fill in the medium term.
The move away from the High Street is not a new phenomenon, We discussed this in one of our earlier blogs.
There are now different factors in play:
- Online has been forced forward during lockdown.
- Rents and Rates are now a huge barrier to the existence of physical retail.
- Social distancing is here to stay – what is the long term solution for this in Retail?
- An empty High Street is not conducive to a good Retail experience
- What is going to reinvigorate confidence for shoppers to return to the physical store?
In the last six months we have seen a massive shift from city centres to the out of town locations in the suburbs, an example of this is the Coffee sector, which is a direct symptom of working from home, and little travel and tourism trade.
Just over a third of coffee shops across the country have not reopened since the end of lockdown, with independents faring about equally with chains, according to the Local Data Company (LDC). While some may yet spring back to life, many will not survive as analysts estimate that the market is likely to shrink by a fifth.
People are more comfortable visiting the smaller, out of town independent retail outlets – and it’s a good way to get people used to getting out and about again.
Impulse is seeing brands switch to more obscure physical channels, especially if digital has been exhausted. As the experience becomes the most important factor, we spend more time concentrating on the quality of the product, and environmental impact, which unfortunately at a cost.
Unit footprints are reducing, as the target retailers are in smaller locations, more familiar, and upmarket – including farm shops and garden centres.
One of the industries futurist voices, Doug Stephens, speaks some good sense:
“When we look back on this historic exodus, we’ll see that the retailers that survived it were those that realised early on that physical stores have become an archaic and tenuous means of distributing products. If nothing else, Covid-19 made that abundantly obvious. As we catapult from the industrial era of retail into the digital age, brands that survive the trip will see physical stores not as permanent, monolithic structures, but rather as ephemeral, flexible and experientially-based concepts, aimed less at moving product and more at acquiring new customers by moving hearts and minds with compelling real life experiences.”
What is being proven is the appetite for physical retail. It’s in our DNA, and where we see Impulses success coming from, is assisting brands to achieve this.
So if we fast forward 5 years, we expect to be working on more bespoke, sustainable projects, where we see the high street filled more with upscale residential, and fewer more quality retailers and coffee meeting venues.