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How online retail can save the high street, not kill it

The death of the high street appears to be a foregone conclusion. The high street retail model has ceased to work due to the success of online shopping and the broad reaching grip of the recession; or so the mainstream media would have you believe. The fact is the high street isn’t dying, it's evolving.

The continued success of John Lewis, Apple, Argos and others is down to their evolution of the old high street retail paradigm to one that fits with and complements the new online retail world.

The old paradigm

Woolworths is an excellent example in how belief in the old paradigm can lead to a shop’s demise. The paradigm being that offering a large amount of stock enables you to keep prices low, and thus people will flock to your shop because of your excellent prices.

The flaw in this model is that the high street retailer will never beat an online shop on price; a physical retailer’s overheads are just too large.

Woolworth’s range was broad, selling everything from children’s clothes to electronics to confectionery so the staff couldn’t possibly provide any meaningful advice on stock.

With online shopping there is a product description, pictures of the product and user reviews which provide the purchaser with sufficient information to make an informed buying decision.

A consumer is far more likely to buy a product they understand and the Internet gives the consumer as much information as they can read about a product.

Part of the success of John Lewis’s physical retail space is the level of expertise among its workforce, with staff typically able to provide intelligent, useful answers to consumer questions about products.

The same goes for Apple Stores, which ally employee expertise with a very deliberate and inclusive layout that allows the customer to fully acquaint themselves with the products they consider buying.

Using space efficiently

Upgrading the retail floor is a key factor to evolve to the new retail paradigm. Burberry sought to emulate their website and online shopping experience in their Regent Street store and so replaced the standard ‘tills-where-you-queue’ system with sofas next to sales staff, where customers could sit whilst paying for their purchases.

Burberry essentially created an environment to reflect how consumers purchase online at home. In a similar way, Apple uses mobile point of sale terminals in their stores to enable staff to assist customers anywhere in the store and enable those same customers to pay for purchases without the need to queue or go to one specific location.

Apple doesn't waste valuable floor space by filling it up with stock, instead it utilises the space to show off their products which helps customers to understand what they’re buying before purchasing.

This strategy compensates for the most glaring weakness of online retail; the inability to touch, smell, taste and hear products before you buy them.

Website synergy

One key reason retailers like Apple and John Lewis perform better than competitors is because of the synergy created with their online retail experience. Instead of treating them like two different entities they’ve implemented systems that complement their online services. Some examples include:

  • Returning online purchases in-store
  • Physical pick-ups for online purchases
  • Booking appointments online to test products in store

The flagship Burberry store has implemented a number of technological aspects to its retail space to give it a ‘website feel’.

The ’website-feel’ is created through large screens around the shop floor and by attaching RFID (Radio-frequency identification) chips to items of clothes that trigger audio-visual content about that item when in the fitting room.

Time to evolve

Whilst it is unlikely that many retailers would have the ability to make an investment like Burberry, the lessons are clear.

High street retailers need to be convenient, knowledgeable and demonstrate their products. Live-demonstrations of products at set times and replacement of shop floor stock with single demonstration items with free delivery if they purchase are a few strategies used.

Managers should try to implement website sensibilities in their retail store, perhaps creating a basket system that allows consumers to ‘place’ items in their basket to pay for when they’ve finished browsing.

By combining the tactile advantage of the high street with information and convenience provided by online shopping, the high street continues to improve the consumer experience. Many understandably see online retail as killing the high street, but learning from its strengths and transferring its principles to the physical realm could actually save traditional stores.

For more in this series see:-

Using technology to help create customer loyalty