It hasn’t come as a great surprise that the Arcadia Group has gone into administration.
Here’s a Google trends graph of their most popular brand, Topshop, being searched over the last 5 years.
Only second to ASOS in 2015/2016…
Slumping to last place by 2020.
Amongst inflation, rising overheads and over-expansion, retailers just haven’t adopted emerging market trends or immersified themselves enough in the digital realm to co-exist with thriving online stores.
Arcadia CEO, Sir Philip Green announced, ‘The increase in digital sales is taking place at the expense of traditional bricks-and-mortar retailing as consumers embrace the opportunity to purchase across all the channels available to them…websites such as Boohoo and Asos suck sales out of the high street”.
The Arcadia Group isn’t the first (or last) to collapse in 2020…
Edinburgh Woollen Mill (EWM) Group who own Peacocks and Jaegar, collapsed in November after failing to find a buyer.
The bricks-and-mortar retail arm of the prestige shoe company Oliver Sweeney Group was placed in administration in mid-July
TM Lewin declared national closure of all its high-street stores also in July after the firm said “it was going online-only in a bid to save the 120-year-old brand”.
Others on the list include Go Outdoors, Monsoon, Harveys Furniture, Benson for Beds, Victoria Secrets and Quiz.
Senior retail executive, Courtney Hawkins, commented “Product relevance is terrible [in-store], especially when you compare to what online stores can show, sell, and have incredibly easy return policies. They have upended the economics of an industry, and the industry has struggled to respond.” – Forbes
What can retailers do?
- Get online…yesterday. Having a great website and adopting digital marketing strategies such as search and display ads and SEO is non-negotiable for any store wanting to live onward. E-commerce businesses should anticipate an 84% growth rate, from $4.1 trillion in 2020 to $4.9 trillion in 2021; a steady upward trend with no signs of decline.
2. The future of big retail needs to be friction-free and focused 100% on the customers’ experience. The choice is not the prime driver, but the best way to build equity is to make it so easy for the consumer the brand value, the historical significance of the brand stands -out and not the inherent hassles and perceived restrictions.
3. Specialty retailers need to narrow choices to core offerings in order not to carry high inventory numbers.
4. Omnichannel shopping. There are many ways where multi-channel shopping is on the works. For instance, people can research a product online and then buy in-store, or buy products online and pick up in-store. The more channels your shoppers use, the more likelihood of an increased average order value.
5. Get creative. Retailers like Walmart have looked at their space and turned areas into outdoor space. John Lewis has turned sites from retail to converted apartments. Steve Lister is a great influencer in the retail innovation space – i recommend you follow him if you own a physical store.
6. Curated inventory and experiences will drive brand value, and that also is going to mean that ethics and inclusion, sourcing, and the environment become essential parts of the purchase decision. Think slower fashion, sustainability and ethical processing.
Jade Bartholomew, Director, Sierra Six Media
01245 791223
