Have you broken your New Years resolutions yet…or have you, like me, not even started? I’m starting mine in February. Why? Because January has traditionally been a month for ‘resolution failure’ and who wants to set themselves up to fail in the face of positive change?
This year, I’ve decided I am I going to be different. The questions I am asking today are ‘when is it right to be different and why is it right to change?’ If I learnt anything in 2012, it was that it’s very easy to get on the bandwagon of change when all you really want is to be different. The ‘talking heads’ were saying as much on the TV sofas over the Christmas holidays.
The truism is that some things never change. For instance, the retailing figures coming from the UK high street this season. Depending on who you are and what you sell, trading figures directly reflect today’s family priorities. So: no change there then. What is surprising is that any of us should be surprised by shoppers’ current reluctance to part with their money or to swap to cheaper brands to leave more cash in their pocket. Economic data has been highlighting this outcome since the dark days of 2009, when the recession first started to really bite. There has been a significant decline in the national retailing picture and whilst some businesses have suffered through inertia or unwillingness/inability to change quickly, others, identifying the inevitable market transition, have been lithe to adapt to the shifting sands and have thrived. Conclusion: whilst we recognise that today many things are different, they actually started to changed in 2009.
Here are some examples. Where was Poundland in 2009? Now it’s a high street staple. In 2009, own labels were perceived as products for those who had to watch the pennies and Poundland, a place where children spent their pocket money. Now, Poundland is an essential visit in most Mums’ shopping landscape. In 2009, everything had to be ‘white by design’. Today ‘affordable’ is king.
Back in 2009, both Tesco and Asda were the retailers to watch. Consumers perceived these destination shops to be distinct from the rest. Now, they are looking tired and somewhat rudderless. They need to change to keep up. Standing still is not an option: if competitors are evolving then standing still is, by default, falling into decline. Today, Sainsbury’s and Waitrose are leading the charge, with Morrisons looking like a business that is in the running but perhaps, needs to further refine its offering. These three contenders for the mantle of ‘best supermarket’ have made significant differences to their proposition over the years and are now reaping the rewards of those decisions. Waitrose are rolling out smaller stores across the UK – Sainsburys have a fully integrated modernised supply chain whilst Morissons increased market through one of the largest acquisitions in UK retail history. However, it is Aldi and Lidl that are making a big difference. These organisations are making major changes to the way in which we shop, replacing the luxury of brand choice with the ‘stack it high, sell it cheap’ approach. This ‘retro’ strategy is rerouting shoppers from their familiar stores by simply offering them a means of making their pound to go further. These young pretenders have accelerated their market share through location, price convenience and brand ‘election’. They are different.
So, what has changed this festive season? Well…spending on food has dropped as Mum has bought smaller turkeys and has not been so extravagant with the Christmas table.
What’s made the difference? The household budget has been affected by several changing conditions. A quick snapshot highlights job insecurity (or no job at all), rising fuel prices, fear of inflation, rising utility and food bills as well as the strong pound affecting UK exports. The increasing costs of holidays, flights, commodities and the unknown abyss that is our own economy and our island’s place in the world’s shopping mall all add to the tightening of mums’ purse strings. Life has become less certain since 2009. Change is everywhere!
Here is something else…online shopping has made a significant difference this year. Its dominating ascendancy has been predicted since 2009. This year, its pervasiveness was markedly palpable. Over a billion dollars was spent in the UK online on Christmas Day! This is where the change of the greatest magnitude is being made. People want to browse from the comfort of their sofa. Consumers, of all ages, want a direct say in what’s being bought. Online shopping is democratising the choices families are making from the comfort of their own homes. In reality, this is nothing new though. Lest we forget, catalogue shopping was the first to address this consumer convenience in the 1950‘s. Today, technology allows for a more interactive experience and this journey has not finished by far. This is one vehicle of change on retailer can afford to miss.
In the UK, we are the most internet-dependent nation in Europe. Shopping online is the new fashion and it’s here to stay. Sites like Amazon and Groupon have opened up the online experience to a wider group of engaged shoppers. The Internet has put purchasing decision-making back in the hands of the consumer.
But in an effort to be different, some things change for the worse and you ask yourself, ‘why did they do that?’ Take Amazon for example. I downloaded its new iPhone app. I was hoping the new one was better than the old. What I got was worse.
Like many online shopping sites, Amazon has recognised the obvious flaw in the increasingly ubiquitous Internet shopping experience: the inability to browse. Consumers have quickly come to regard the Internet as a place they can visit from the comfort of their home, source what they need at the best price/delivery ratio and leave. They can’t browse. Which means that the opportunities for up-selling, cross-selling or simply appealing to a whim are lost.
I was hoping that Amazon’s latest app would provide me with a browsing application for my smart phone or tablet. It’s essential for Amazon’s business because the company does so much more than just sell books. Amazon needs an app that allows us to see each shelf and what’s displayed on it to browse at leisure. But my disappointment was exacerbated when I realised it couldn’t do what I wanted it to do and that it was in fact, a step backward from the previous version.
Anyone following this blog will know that I have bleated on about online browsing technology for a long time. What I have found is that today, the online store assumes that everyone visiting them knows what they want. But that’s not necessarily the case. At the moment, it’s all the consumer can get. How often is it the case that we don’t know what we want until we have seen it? We didn’t know we wanted the Internet or the multi-functional mobile phone but now, we can’t live without them.
Who wouldn’t want the option to browse from their sofa, to be tempted by new products they new nothing about, to be presented a good idea or to buy on a whim: online shoppers are seeking the shopping mall experience…. online.
Some retailers believe there is a difference between on and offline retailing. Some need to expect a big change if they want to be successful online. We forget online is the same as offline: it’s just that we want to make instant purchase decisions online and the ability to scheduled a delivery at a time convenient to us.
So, my other New Year’s resolution is to make a difference and embrace this change and accept that some of my favourite stores will disappear and others, that I haven’t yet visited, will make a big difference to the way we shop. Change is good…most of the time. Doing it differently …that’s affordable!