There can be no one-size-fits-all solution to attracting customers, but as a general principle retailers need to focus on selling services as much as selling goods
The US apparel retailer Gap has been struggling in Europe for some years but the pandemic has finished its UK high street presence. While it continues as an online operation, its closure of its 81 stores in Britain and Ireland is another blow to the battered city centres and shopping malls.
There are two stories here. One is about what is happening to retailing, the other about what will happen to towns and cities.
On the first, it has become clear that for retail chains to survive they have to offer something special – they have to make the experience worth the journey. Otherwise it is vastly easier to buy online. UK retailers have recovered quite a lot of the ground they lost to online, pulling it back from 36 per cent of all sales in January to 26 per cent in May. But that has been partly because the novelty of the reopening has pulled in people who were waiting for the chance to shop in real life.
We don’t yet know where retailing will settle down, but we do know that the cull of weaker brands shows that many chains cannot offer enough of a special occasion for shoppers. It is not just seeing the goods, trying on apparel, catching the feel of the fabric – though all that matters. It is about going into a store, being sold something – and feeling better when you come out.
The thrill of being a retailer is putting the goods out, and then knowing within a few hours, maybe a few minutes, whether they move. The thrill of buying is going home with something that you did not know you wanted but knowing it is exactly “you”. Online cannot do this. But for many, the convenience of online offsets the thrill. Maybe Gap will make it work as an online operation, but the fact that it couldn’t in the rough and tumble of the high street says something about the strength of its brand.
For the city centres, this essence of creating an experience is vital to their future. They can fight back. Even at the height of the pandemic two-thirds of all retail sales were through shops and supermarkets. Some retail space will have to be returned to other uses, especially housing. But that could be a plus. People like to be able to shop near where they live and a larger residential population in a city brings life to it – just as students bring life to university towns when they are up.
But city centres need to be nurtured. They need to be safe. They need to be clean. They need to be welcoming. There will probably be a shift to local, specialist shopping rather than relying of national retail chains that make centres identical all over the country. There can be no one-size-fits-all solution, but as a general principle they need to focus on selling services as much as selling goods. You cannot get a shampoo and cut online.
So well-managed towns can use the crisis to make themselves more welcoming, nicer places to be. There are many experiments, including closing side roads to allow pubs and restaurants to use the space for outdoor dining. The challenge will be to see which experiments enhance the environment and which ones make centres net losers.
This is not about Gap, or any of the other chains that have not made it through the chaos of the past 18 maande. This is about reviving the urban environment to make it more inviting and satisfying for citizens of all ages.
Sadly many people will lose their jobs as a result of the closures. The task for the authorities is to see that new and more employment is generated by creating more satisfying city centres.