The poor old British High Street took a bit of a kicking earlier this year when specialist retail chains Jessops, HMV and Blockbuster called in administrators within days of each other.
January tends to be a relatively quiet news month so the chains’ failures received a huge amount of coverage in the media. One particular quote that stood out of the many subsequent ‘demise of the High Street’ features was that specialist retailers had to be ‘wary of their niche becoming a tomb’ (from Neil Saunders of retail analysts Conlumino).
In all three cases that is exactly what happened. The retailers’ markets had moved on without them. In Jessops’ case the low end of the photography market migrated to smartphones and the high end, which often had more product knowledge than the store staff, knew exactly what it wanted and was able to source it cheaper elsewhere. HMV found itself squeezed on all sides by supermarkets, Amazon, iTunes and Spotify and fought back with a less than great website of its own which undercut its High Street stores. At the time of writing, HMV does look like it will be rescued in some form though. Blockbuster faced similar threats to HMV but with the addition of firms like Netflix and LoveFilm chasing its core product – film rental – and giving consumers easier access to it.
Whatever the eventual outcomes of these High Street collapses, specialist retailers in every sector should indeed be ‘wary of their niche becoming a tomb’ and keep a close eye on where the market for their products is heading. This is a subject we will be returning to in ETO throughout 2013