High Street Blues.
Calm, confident, assured – all things customers need to see from any brand they do business with. It’s also what we want from our leaders – and so when the guy in charge of our economy has a bit of a wobble, retailers get jumpy too. It’s safe to say that things are looking pretty jittery for high street retailers at the minute. Take a look at the business section of any national rag and you’ll see doom and gloom stories for some familiar stores. Brace yourself for a bumpy ride…
Bad times all round.
First up, chief exec of Next, Lord Simon Wolfson, has warned that the retailer faces its worst year since 2008 due to a slow in the growth of real earnings and a poor outlook for consumer spending. Come on George, you said you’d sort it by now…
Follow that with news that British Home Stores (yes, they still exist – who knew?) have entered into a company voluntary arrangement (CVA) and need to raise an additional £100 million to turn their fortunes around and you’re starting the get the picture. And that picture looks more like Munch’s The Scream than a cheery vase of sunflowers.
Poor BHS. Years of getting things catastrophically wrong have definitively come home to roost and the brand that couldn’t stand out from any crowd has finally hit rock bottom – meaning that the day they were bought for £1 wasn’t the worst things could get. Incredible.
And the bad news isn’t over just yet.
Although we can possibly enjoy this one. This week, Mike Ashley – he of Sports Direct fame – complained to The Times that the scrutiny over his company’s practices was affecting his profits. Boo hoo. Someone that gives us all a bad name by trying to pay below the minimum wage shouldn’t complain when customers refuse to support their business. And as Mr Osborne himself is fond of telling us, we’re all in this together – and that means customers can feel the pain of Sports Direct’s hard-done-to workers.
I hope Mike felt better for his moan because he certainly wouldn’t feel great once it was published. Telling the nation that “we’re not trading very well” meant that more than 10% fell of the value of Sports Direct shares by the end of the day. Oops.
So what lessons can we learn?
There are many, my TMP faithful. The lessons to be learnt from Sports Direct’s most recent troubles are ones current being shared in primary schools up and down the land – think before you speak and treat the people in your life with respect. That bit’s simple. For anyone over the age of 5 and who isn’t called Mike Ashley.
But where did it all go wrong for BHS? A long, long time ago they had a great position on our high street – but as rivals progressed, they just never seemed to get it right. Over recent years they’ve failed to compete with fast fashion at Primark, glamorous ready meals at M&S and gorgeous homeware from Next. In other words, they haven’t defined what they’re about and have attempted to cover all bases instead of standing out from the crowd.Remember what happened to Tesco when they tried to take over the world?
There’s a home supplies shop near TMP Towers that sells everything – and I mean everything – you might need for your home. It’s got nails and tools, buckets and bins, garden furniture, kitchen appliances and enough cleaning supplies to keep even the most committed neat freak happy. But it works! High turnover of goods at low margins and local inhabitants know that if they need something for their house they can find it within their drafty warehouse. And importantly – there isn’t anywhere else like it for miles around.
The same approach was never going to work for a high street chain – because there are other high street chains on offer too. A USP of “we sell everything you possibly need” won’t work if other people are meeting any of those needs – and doing it at a better price or a higher quality than you can provide.
So what to do instead?
Regular readers can probably fill this part in themselves. You need to know what your customers are really looking to you for. What it is they want from you? Are you sure you’ve got that right? The only way you can be sure is to find out what your business looks like from the eyes of the consumer – how they experience every touchpoint and whether you’re meeting the very deep seated emotions needs that they have. And yes, that’s where The Monachie
Project comes in.
Things might seem gloomy for the British high street but there is hope for businesses that are getting it right. Let us help you do that and you can avoid having your very own BHS moment any time soon. It really is a no brainer!!!