The Exaggerated Rumours of High Street’s Demise.
It was Napoleon who, in a brilliant piece of insight that was perceived by many as an attempt to insult Britain, called us a Nation of Shopkeepers. I doubt anyone at the time would have been offended, and it is safe to say that his pronouncement has since risen to become a fondly fitting definition of Britain’s entrepreneurial flair and trading DNA.
However, as the failure of British retail stalwarts like HMV (founded in 1921), Jessops (1935), and the American video chain Blockbuster (1989) over the last 90 days have demonstrated, the phrase is perhaps for the first time under real threat of being consigned to the outlet mall of history.
Analysts, expert commentators and journalists have been furiously busy citing various theories and creating ever more dramatic headlines: “Bloodbath on the High Street,” etc. There are obvious things to point to, such as the failure by the government and local authorities to adapt outdated models of legislation and taxation. Right now, online corporations enjoy loopholes that brick-and-mortar retailers don’t.
But we all know the real reason: the device and web page that you are reading this article on is being served up from a data-center in a city like Cincinnati faster than the speed of thought, for free. A fact which has resulted in rapid and massive transformation of every business model on Earth.
I use the word “transformation” rather than the more vogue “disruption” because, contrary to the analysts’ warnings, retail is thriving. We’re not seeing the death of retail, we’re seeing Darwinian evolution separate winners from losers.
Reading the extract from HMV’s Annual Report in 2002 could have given anyone with a web connection a sense of its forthcoming demise—and not just because they spelled Internet with a lowercase ‘i’.
“Contrary to some forecasts in recent years, the internet has settled down to become a worthwhile but minority channel to market. For example, internet book sales have plateaued at just over 5% of the market, and it seems unlikely that there will be sufficient demand to enable multiple operators to develop profitably”
My view is that rather than killing the High Street, online retailing is transforming established patterns of distribution and allowing the innovative pioneers to make it better. . John Lewis, for instance, has combined its policy of never being knowingly undersold with deep product expertise in-store with an online retail experience that is frankly second to none. Total sales for 2012 were up 14.8% with Internet sales increasing 44% year on year..
And what’s wonderful is that in this regard—with our concentrated urban areas, open-minded consumers, thriving tech and creative sectors, and large proportion of people under 30—Britain is leading the way.