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Thursday, 31 January 2013

2013 - A Year of Change for Retail?

We're a month into 2013 and already we have four major chains in administration. There's no doubt harder economic times have an effect on the High Street but I think these stores are also now outdated as consumer shopping habits have changed, preferring online services across all of these industries.

Most of us keep our photographs in digital formats these days and prefer to shop around for the best deals online. Amazon had a booming Christmas, reporting record Christmas takings of £13 billion so it's no surprise the High Street is suffering. Blockbuster Video is also a victim of being pushed out by Amazon owned Lovefilm, as well as other services such as Netflix, allowing films to be streamed online or posted out directly, as is HMV with consumers preferring itunes or other mp3 or mp4 downloads. It's the same for electrical retailers - we may well go in store to have a play and a look at the item we want but we'll still go and see what the best deal we can get online is.

As we embrace the digital age the way we have always shopped will change, and harsh economic environments only serve to make that happen sooner rather than later. There is some hope for the likes of HMV as the music industry doesn't want to see its only high street chain go but it really will be paying lip service to the iconic brand, and likely will see less stores across the UK.
With expensive rents and rates the High Street cannot be as competitive with companies that have less overheads and extensive distribution channels. The lack of UK based tax revenue is another issue entirely, however it doesn't seem to have affected Christmas sales figures for certain companies.
Retail has seen many changes over the years - consumerism drives that change, whatever the economic climate. For the big brands it's about flagship stores, retail parks, and shopping centres, and of course we have the supermarket dominance which make installations all the more innovative and interesting as we fill larger spaces. I think we'll see the High Street change and shrink as big brands steer towards the above, driving rents down on the High Street and making room for independents and a whole different kind of experience on the High Street.

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