How retail giants could thrive on the high street after the pandemic

Even before the COVID-19 pandemic, the UK’s high streets were already undergoing a period of transformation a slow and painful declineIndependent shops struggled, department stores fight for survivaland well-known chains fought for market share.

A year after March 2020, shopping habits had changed dramatically. “Indispensable” stores were closed for months, and Online spending has skyrocketedIn 2020, e-commerce accounted for more than 30% of UK retail sales for the first time, up from 20% in 2019. Such a gigantic augment one year is unrivaled.

Has COVID-19 changed everything? Has the pandemic simply rapidly accelerated changes that were already planned?

Take John Lewis Partnership for example, an employee-owned company is often seen as a reliable indicator the state of retail in the uk. Recently £517 million announced annual loss (so-called the first in its history) and plans to close more stores.

Its CEO, Sharon White, has certainly had a tough time since acquisition in 2019responding to a massive augment in demand for online services and an economy grappling with uncertainty.

Her plans for “reuse” of company-owned premises and develop the compact format John Lewis Waitrose supermarket stores may seem like a bold response to the changes caused by the pandemic.

Earlier in 2019, John Lewis hired a specialist company with experience in “retail real estate reuse” to oversee “facilities management.” In other words, he was already thinking of up-to-date ways to operate the real estate he owned. So perhaps such changes were not unplanned.

Another British giant, Marks & Spencer, has also announced a significant change to its operations – creating a one-stop shop for fickle shoppers and supplying competitive brands. These will include Jaeger (which the company bought), Hobbs, Joules and Sloggi, which will be sold alongside own-brand products.

This strategy is a astute move, creating a single destination where shoppers can browse a variety of designers, styles, and prices. Offering branded and private-label merchandise allows them to better compete with e-commerce specialists and regain lost market share.

It’s a necessary shift away from M&S’s ineffective and dated notion of chasing its “core customer.” Instead, the company has accepted that it needs to appeal to consumers who defy strict categorization. And after the transaction to supply online grocery retailer Ocado, M&S gains a huge advantage in having access to the company information database which will be crucial to understanding customer behavior.

This behavior, known in the industry as “consumerism”activities, interests and opinions” (or AIO) is extremely vital, regardless of the pandemic. my own research has shownTo be successful, retailers must constantly think about brand identity, consumer behavior and the impact of globalization and regional trends.

Following trends

This can be seen in the changes announced by John Lewis and M&S, which reflect a wider trend in the US where retail giants such as Nordstrom AND Macy’s experimented with the way they sold. Significant changes include the creation of compact and stores “without stock” – stores that do not offer a full range or full stock and operate more like showrooms, where purchases are made with home delivery or personal collection.

These stores also offer services such as styling, alterations, tailoring and regionally specific product lines. They can also offer exclusivity and expertise, as was the case with the award-winning The Boy with the Sneakersopened in 2013 in Melbourne, Australia, sells sporadic and confined edition products without having to store them in a warehouse.

The trend towards inventory-free stores and malleable on-site retail solutions was inspired by the success of the Story store, which opened in Fresh York in 2011, which regularly changed the theme of its products.

Founder Rachel Shechtman (who became Macy’s “brand experience specialist” and shaped the brand small format strategy) explained“The story has a magazine point of view, everything changes every four to eight weeks like a gallery and sells things like a store.” She added: “The magazine tells stories through images and written words, and we do that through merchandising and events.”

The shift to small-format shopping is also being driven by the popularity of direct-to-consumer brands that sell online, through their own stores and pop-up stores.

Department stores are also now competing with brands sold directly to consumers who sell online and through their own flagship stores without using a more time-honored wholesale approach. They can operate in a much more agile way, using social media as a rapid feedback loop with customers.

This kind of agility is now being forced upon struggling department stores across the UK, where growth strategies that took years to plan now have to be delivered in months. Dramatic shifts in consumer behaviour caused by lockdowns have accelerated these changes at a breakneck pace.

But these changes don’t necessarily mean the future is bleak for time-honored, established retailers. They do mean they need to be open to a variety of solutions.

Online shopping isn’t the only option. Miniature formats that focus on products and services for diverse customer lifestyles provide greater flexibility to test market solutions that work regionally and locally. To survive after the pandemic, companies must consider which elements of “retail theater” they want to ensure remain relevant.