High street master presentation for web

The High Street Reborn A Seminar

Thursday 18th April 2013

University College London

Engineering Room 1.03

Malet Place

Off Torrington Place

London WC1E 7JE

The High Street Reborn

Agenda

1.30 – Registration

2.00 – Chair’s Welcome - Ian Rutter, Senior Manager Engage Business Network

2.05 – Bryan Roberts, Retail Insights Director, Kantar Retail EMEA

2.30 – Richard Gomersall, Founding Partner, Insight with Passion

2.55 – Refreshments

3.10 – Richard Lemon, Associate Director, CBRE

3.35 – Hugh Forde, Managing Director Retail, Trading and Training, Age UK

4.00 – Panel Discussion – Questions from the Floor

4.20 – Networking

5.00 – Close


Ian Rutter

Senior Manager, Engage Business Network

Introduction

• Over 30 per cent of the UK population are above the age of 50 and they hold 80 per cent of the wealth in the country;

• There are currently more people above the age of 60 than under 18;

• By 2083 one in three people will be over 60;

• Since 2010, spend for households that include an individual aged over 65 has risen from £109 billion to £120 billion per year.

• Social role changes, physical and mental abilities, and occupational changes amplify the diversity of older people in many different ways.

Introduction

Projected population by age, United Kingdom, 2010 to 2035

millions

Ages 2010 2015 2020 2025 2030 2035

0-14 10.9 11.5 12.2 12.5 12.3 12.1

15-29 12.5 12.6 12.2 12.2 12.8 13.5

30-44 12.7 12.5 13.2 14.0 14.1 13.7

45-59 12.1 13.0 13.2 12.5 12.3 13.0

60-74 9.2 9.7 10.3 10.9 11.8 12.0

75 and over 4.9 5.4 6.1 7.3 8.1 8.9

75-84 3.5 3.8 4.2 5.0 5.3 5.4

85 & over 1.4 1.6 1.9 2.3 2.8 3.5

Introduction

Introduction

• "Over 60% of respondents would visit the High Street more often if it presented more opportunities for social interactions."

• "Going shopping is a leisure activity for 1 in 3 participants."

• "54% of participants' shopping trips last one to two hours.“

Ageing Consumers: Lifestyle and Preferences in the current marketplace, 2012. Age UK

• "This may sound hopelessly idealistic. But those who see high streets purely as a commercial retail mix need to think again."

Portas Review

Introduction

• "If my review is the catalyst for change, encouraging shopkeepers, landlords, local councils and consumers to engage with an alternative, more optimistic vision of tomorrow, where everyone benefits, then it will have been worthwhile."

Portas Review

• "High Streets are a really important part of building communities and pulling people together in a way that a supermarket or shopping mall, however convenient, however entertaining and however slick, just never can."

Portas Review

• “High streets and town centres that are fit for the 21st century need to be multifunctional social centres, not simply competitors for stretched consumers. They must offer irresistible opportunities and experiences that do not exist elsewhere, are rooted in the interests and needs of local people, and will meet the demands of a rapidly changing world.”

Action for Market Towns (2011) Twenty-First Century Town Centres

Introduction

The Winchester Studio is David Lloyd Leisure’s second high street studio aimed at giving clients of all fitness levels easy, flexible access to exercise and nutritional services – in the first initiative of its kind by a major health and fitness operator in the UK.

"I am sure it will encourage more people in Winchester to be active, stay healthy and enjoy sport.” “David Lloyd Studio will not only boost the viability of our town centre, but will also encourage us to be healthier and fitter. I tried personal training and the studio’s fitness equipment today, and I am already tempted to improve my own fitness levels.”

Introduction

"If you track the trajectory of retail from the first humble markets to the Victorian High Street through to the introduction of modern malls it’s clear that each kind of retail becomes more and more organised. Malls are not always better, but they are often more organised. As such, they can easily provide shared services from parking to child care to gift vouchers to orchestrating variety in restaurant options."

Aaron Shields, Fitch

Introduction

“The most vibrant town centres offer a wide range of locally responsive services that create a comprehensive retail, cultural and community hub. This is crucial for the future of the High Street as it is an offer that its competitors struggle to match. Future Government policy must acknowledge this, not treating retail in isolation, but empowering councils to integrate the shopping offer effectively alongside other cultural and community services.”

Local Government Association response to The Portas Review


Bryan Roberts

Retail Insights Director, Kantar Retail EMEA

What does the high street of the

future look like? Why the impending death of the high street is your fault

2012/13 – not a great deal of fun

14

And what do these retailers have in common?

15

• Structural/economic factors

• Secondary/retail park locations

• Unsupportive suppliers, landlords & lenders

• Niche appeal

• Strong competition (rivals, online, supermarkets)

• Troubled parent companies

• Lack of investment in stores & staff

• Poor assortment

• Lacklustre execution

• Underdeveloped multichannel capability

Source: UK press reports

Fair to suggest that the climate is not hospitable

What is going on in UK retail?

17

What is online displacing?

18

Hypocrisy is the greatest luxury

• Outpourings of grief accompanied the demise of Woolies and the administration

of HMV

• Putting the wringing of hands to one side, these retail brands failed due to a

combination of strategic ineptitude and tangible shifts in shopper behaviour

Retailing is the most democratic industry in the

country. We have voted with our feet and we are

beginning to get the high street that we deserve

19

Playing the blame game

20

• European government(s)

• National government

• Local government

• Banks

• Landlords

• Amazon

• Supermarkets

• The retailers themselves

• Us

EDLP,

promo,

fixed price,

private

label

Private label, brands,

solutions, experience,

environment

Assortment,

customer

service,

availability,

convenience

21

Real value = price + quality + service

Or looking at it another way...

– retailers need to make the shopping trip QUICK

– retailers need to have APPROPRIATE PRICES

– retailers need to make the trip EASY or FUN

22

The “worst case” scenario:

23

Retail Other

Empty stores Bookies

Charity stores Payday loans/pawnbrokers

Pound stores Fast feeders

C-stores/symbol groups Coffee shops

Homogenous (last man standing)

multiples

Chain pubs

The “worst case” – important caveats

• Aside from empty stores – which are clearly unwelcome from a universal

perspective – it is snobbery and elitism that deems many of these high street

components as distasteful additions to the mix

• Previous reviews have unilaterally decided (with little, if any, empirical

justification) that certain types of business are ‘bad’

• Policy should not be predicated on middle class whimsy, but on empirical

evidence that evaluates economic benefit as well as social externalities

24

The “best case” scenario:

25

Retail Other

Empty stores Bookies

Charity stores Payday loans/pawnbrokers

Pound stores Fast feeders

C-stores/symbol groups Coffee shops

Homogenous (last man standing)

multiples

Chain pubs

Independent retailers Markets

Social infrastructure Housing

There will need to be a genuine & seamless fusion of bricks & clicks

throughout

The “best case” – important caveats

• There will be no undoing the past: shopper behaviour & retail structure have

irrevocably altered

• Clearly, economic & financial recovery (touch wood) might alter the pace of

change and the evolution of high street mix

• Achieving the best case will require some adjustments to the retail

ecosystem.....................

26

Outlook

27

• Don’t worry about the stable door, the horse is miles away

• Nostalgia is an enjoyable waste of time

• Dialogue & collaboration with the ‘baddies’ is essential

• More science, less ‘Disgusted of Tunbridge Wells’

• Proper, national joined up thinking is required, rather than a morass of regional

silos & town teams

• Thinking should be backed up by consultative dialogue / research with a variety

of representative groups

• Acknowledge, realistically, the overcapacity and the obsolescence

• The future is multichannel, not online – we need to make our bricks more clicky

Richard Gomersall

Founding Partner, Insight with Passion

Retail Theatre For Town Centres

Bring your shop floor to life

To engage your customers and get them back on the High Street

Richard Gomersall

INSIGHT WITH PASSION

Who are we?

What do we do?

What we will cover today

Demise of our High Streets

Why we got involved …

VALUES OF IWP

Access for All Believe in communities Belief that businesses which do good

… get good

What we’ve tried to do…

IWP CREATED

2009 2010 2011 2012 2013

We could see

decline of our

towns and

offered help

to local

councils

Ran our own

event to help

retailer in

Huddersfield

due to lack of

response

Raised the

issues with

the Govt

invited to

WTCC

Press

Campaign

Retail Clinics

in 7 Yorkshire

towns and

cities

We haven’t been quiet about what we think …

Why we continue to champion it…

THINGS CAN BE DONE

Changing the fate of high streets is possible … It needs leadership

Don’t agree there is no future for towns … just need their own point of difference

Don’t believe the internet will take over … just need to give customers a reason to visit

Retail theatre – what is it ? …

It has history and pedigree …

Its about making your store look different …

It’s making sure your service feels different …

It’s making sure your people act differently …

Retail theatre – what is it ?

Set you apart from the competition …

Become a destination to drive footfall …

Tell your brand story …

Encourage loyalty …

Why do it?

Driven communication …

Attracted and engaged customers through visuals…

Been informative and interactive …

Delivered on their mission / service promise…

How we deliver retail theatre …

Get a clear understanding of the situation …

Understanding

Bring the brand to life …

Compelling proposition …

Communicate constantly …

Engage at every opportunity …

How we deliver Retail Theatre

Refreshment Break

Richard Lemon

Associate Director, CBRE

Britain’s high streets Romantic ideal or social necessity?

Richard Lemon

Associate Director – Planning, CBRE

Some questions

• Is there a place for our high streets?

• Does it matter if they disappear?

• And if they are to survive, what will they look like in the future?

What the Government wants

• Town centres that are:

• Vital and viable

• At the heart of communities

• Competitive/provide for consumer choice

• Diverse and individual

What’s been happening?

• The rise of the hypermarket

• More out of town retail parks

• Consolidation: larger stores in fewer centres

• Growth of online shopping

The rise of the hypermarket

More out of town retail parks... with a changing role

Larger stores in fewer centres

Growth of online

What this means

Major centres

Secondary centres

Local and smaller

district centres

Does this matter?

• Of course it does!

• Access to shops, services and amenities is essential to

social inclusion

• But tends to become harder for older people:

• Increasing frailty

• Declining access to private transport

Does this matter?

Age of household

reference person

Corner

shop

Super-

market

Post

Office

Doctor

16-44 1 1 1 2

45-64 1 2 2 2

65-74 3 2 3 3

75+ 7 8 7 7

Percentage of people reporting problems accessing key amenities

by age group – England

Source: Survey of English Housing 2004/5

A sustainable future for our high streets?

• Not just a romantic ideal

• Important for social inclusion

• So how to secure their future?

So how do we do this?

• Identify each town centre’s role

• Be realistic about consolidation

• Embrace ‘flagships and outliers’ model

• Embrace omni-channel retail

• Get the right development in the right place

The role of centres

• What role can/should each town centre/high street play?

• Should it be retail-focussed?

• Or should it focus on services, leisure or community uses?

• Need to adapt planning policy accordingly

The role of centres

Be realistic about consolidation

• Some of our centres are simply too big

• Vacant units discourage people from visiting

• And dampens what demand there is

• Need to focus on the core

Be realistic about consolidation

Embrace ‘flagships and outliers’ model

Embrace omni-channel retail

• Combine the virtual and the physical

• Go beyond multi-channel:

• Buy online instore

• Browse instore online

• Different delivery options

Embrace omni-channel retail

The right development in the right place

• Need to make the best of key development sites

• What’s best for each centre?

• And what will the market deliver?

The right development in the right place

• New store in Forest Hill

• Floorspace increased by 650sqm

• Development also includes 11 homes above store

• Serves as an anchor

• Other retailers complement it

Concluding thoughts

• There is a place for our high streets

• They are crucial to social inclusion

• But they need to adapt, otherwise they will decline

• We need to find new ways of attracting people

• Once in the centre, people are tempted to do other things

Concluding thoughts

• The market is responding

• But policy-makers need to guide change

• And encourage and allow further innovation

Contact

Richard Lemon, CBRE

Tel: 020 7182 2389

Email: [email protected]

Twitter: @rlemon_planner

Web: www.cbre.co.uk/planning

Some final food for thought

Hugh Forde

Managing Director Retail, Trading and Training, Age UK


Engaging with the older old

What part can retailers play in opening the market

Is there a place for retailers who specifically target the

older consumer

Are older consumers ignored?

“Just because I’m over 60 nobody

wants to sell me anything anymore”

Germaine Greer

Our population is ageing - over the next ten years we

will see an explosion of

growth among older age

demographics

Although older shoppers will represent a

strong growth potential, retailers will need to work hard to persuade

them to spend

Older consumers of tomorrow will

be far more engaged and

interested in retail than their

equivalents of today.

The over 55’s will also contribute

the lion’s share of growth over the next ten years, some 62% of all

retail growth (£48.7bn).

Compelling, interesting and engaging offers to entice them

into buying. This is a challenge,

as most shopping destinations have not targeted older consumer and as

a result is a missed

opportunity

Changing Markets

source: The Government Actuary’s Department

50+ People 80% UK financial wealth

65+ Households £109 billion annual spending

Worldwide

Potential Supporting Ratio

(PSR = 15-64s supporting 1 x

65)

1950 - 12:1

2000 - 9:1

2050 - 4:1 globally

2:1 developed world

Changing Demographics Total annual retail expenditure by segment

0

10

20

30

40

50

60

70

£0

£10,000

£20,000

£30,000

£40,000

£50,000

£60,000

£70,000

£80,000

0-14 years 15-24years

25-34years

35-44years

45-54years

55-64years

65-74years

75+ years

2012

2022

% growth

Changing Age of Business A golden opportunity to target the older consumer

and keep the high street alive

Currently the over 50s hold 80% of the nation’s wealth

They are responsible for 40% of consumer spend – that’s £260 billion a year

They are 20 million strong and growing fast

Yet only around 10% of marketing focus is spent on the over 50s!

Older consumers are more likely to shop locally

Ageing Society : Design Challenges

Physical Cognitive

Economic Social /

Emotional

Reduced:

• Mobility

• Sight

• Hearing

• Dexterity

• Touch

Decline in

• Memory

• Information processing

• Numeracy skills

• Changes to income

& spending patterns

• Income value erodes

over time

• Diminished access

to social networks

• Changes in emotional

needs / responses

The high street and even stores themselves

are failing the older consumer. Research

revealed that retailers could do much to improve

the shopping experience for older consumers

including tackling:

The lack of rest areas and seating

Poor store layout (particularly narrow

aisles and poor signposting

Shelves at a height that are difficult

(high and low)

A lack of adequate toilet facilities

Deep trolleys which are difficult to

remove shopping

2035 – MEDIAN AGE OF POPULATION

2020 – 3 MILLION MORE PEOPLE AGED 70 AND

ABOVE

2015 – HALF A MILLION FEWER TEENAGERS AND

YOUNG ADULTS

2010 – MEDIAN AGE OF POPULATION 39.7

Town Centre Futures Older consumers potential to heavily influence the future of our town centres

Source: Experian (Town Centre Futures 2020)

Target the forgotten demographic

Products and services that are aligned to their needs

Personal care area

Personalisation of product choice and usage regimes.

Personalised service and advice

Clear labelling

Friendly, easy to access packaging

Delivering better advertising, including via direct marketing, could give

many companies an edge.

this market is little researched and less understood than traditional targets -

it must change to profit from

Inclusive product design

.

Improving Visual Packaging

http://www.designcouncil.org/

Frustrating to open

Potentially very dangerous

Packaging

http://www.designcouncil.org/

Strategic Intent

To develop advertising that uses creative techniques that are

tested with older customers

To ensure that all marketing collateral is physically suitable

for and understandable by older people

To include needs and behaviours of older people in the social

networking strategy

To regularly test websites and apps to ensure they provide a

consistent online experience for all ages

To ensure the retail store location, product placement,

ambience and sales staff address the needs of the older

customer

To design products/services that include the particular needs

of older people without overtly referencing age

To ensure that sales and support call centres and their staff

are designed to respond to the needs, concerns and

frustrations of older customers

Implementing an age-friendly strategy for older consumers

Co

mm

un

ica

tion

s

On

line

O

nlin

e

Pro

du

ct

s

Su

pp

or

t

Operational Actions

Awareness – appoint a board-level executive to

drive the initiative throughout the company.

Ensure the leadership team is aware and

enthused

Scoping – have a clear action plan to measure

age-friendliness across all disciplines

Prioritisation – devise a way to correlate the

age-friendliness assessment with customer

opinion and with corporate/brand values

Training – recognise the team members will

need to be trained to understand the needs of

ageing customers

Testing – implement a process that ensures that

any major capital expenditure and development

project is vetted for age-friendliness at the

earliest stage

Monitoring – regularly evaluate the quality of the

touchpoints to measure progress. Also consider

evaluating competitors’ performance

What retailers are doing to attract the older consumer

Elderly shoppers in Chiba, just outside

Tokyo, have never had it so good. While

shopping for rice and apples, senior

citizens can pop in for a diabetes check,

top up on stocks and bonds, pull some

yoga poses – and even bag a hot date!

Funabashi new retail concept - A

shopping mall designed with the elderly

in mind. Older shoppers can access

medical clinics, benefit from 5 per cent

discounts on pension day, partake in any

of 140 leisure activities ranging from

calligraphy to hula dancing.

Kaiser, one of Berlin’s biggest

supermarket chains, has fitted out its

elderly-friendly stores with brighter

lighting, extra-wide aisles that can better

accommodate mobility scooters, non-

slip floors and even emergency call

buttons.

Source: Financial Times

In Nov 2012, Age UK launched the Age UK My Phone; an easy-to-use

handset developed and supplied by CyCell.

Panel Discussion

High street master presentation for web

Documents

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