I recently caught up with Sarah Coleman’s great IGD article on the growth of the convenience channel. It got me thinking as to why this has happened after so many years of decline in the high street, and Channel 4 News reporting the ‘Death of the UK high street’ not so long ago.
In her article, Sarah covers some of the key retail activities prevalent on our high streets and outlines some of the opportunities open to forward thinking convenience retailers. Clearly understanding the local shopper and shopper behaviour sits central to this burgeoning success story.
Understanding shopper missions, ‘discountvenience’, franchise opportunities, embracing e-commerce and in-store technology, locking in loyalty and critically, working in partnership with brands and suppliers, all good solid business building tactics that most experienced shopper marketing professionals have been familiar with for a few years now. But what’s driving this fundamental shift in shopper behaviour?
We need to look at the bigger picture and two factors jump out. Firstly how are our lifestyles changing to drive this increased focus on convenience? What’s going on in people’s lives that are driving them to rediscover the high street?
Secondly the maturity of the UK ‘big box’ retail channel.
As our lives become more and more stressful and busy it is simply more difficult to find the time necessary to conduct the traditional supermarket/hypermarket weekly shop.
This trend allied with the fact that, broadly speaking, our big four UK retailers are still slow to change, unable to think strategically and deeply about shoppers needs and have failed to prioritise the need to provide a platform for efficient shopping.
High street (and online) retailers understand this rapidly changing shopper landscape and have adapted to take advantage of this ‘mission-shopping’ dynamic.
The second point is less obvious, but the rapid rise of the big box retail outlets impacted heavily on small, local retailers, particularly those close to the hypermarket sites. Many of these small independents disappeared, unable to compete with the big players.
This left a retail wasteland encircling the big box outlets. This process has now reached its ‘event horizon’ and those independent and chain convenience stores outside of this dormant zone are now benefiting from their geographic location.
They have once again become convenient. Close to shoppers’ homes and just far enough away from the big box competition to be a viable or even first choice for many time-poor shoppers.
Ultimately this is all good news for shoppers. Strong, focused and innovative retail destinations meeting their needs.
It’s also good news for brands. Close working partnerships with convenience retailers delivering increased business and access to shopper insight and innovative marketing tactics to further drive their business.
What is less apparent though is where the big box retailers will benefit. With one or two notable exceptions, Asda’s commitment to creating a seamless multichannel experience for shoppers, there is still a perception that shoppers come fairly low on the priority list and business is about squeezing the supply chain, build it and they will come, pile it high – sell it cheap.
Admittedly though we are seeing some slow and reactionary change with the likes of click and collect, focus on multichannel and range reduction strategies; areas where the convenience channel is already way ahead of the game.
Things will balance out and shopper behaviour will determine the character of the retail landscape. There will be some pain points along the way, a place and a better defined role for those who remain and who are most geared to fulfilling shopper’s needs.
Most encouraging for me is the stance and attitude taken up by some of our most influential and experienced retail leaders.
David Potts, Morrisons new CEO for example, when he says he will “listen as hard as I possibly can to as many of our customers and staff to see what it is that people really love about Morrison’s and what they would like to see more of – and less of”.
If this shopper-focused philosophy can be carried through its business, I think Morrisons has a great opportunity to lead the way for the big box channel.
This article originally appeared on Talking Retail.