UK high streets told to create unique identities to survive recession

The British Retail Consortium (BRC) have released a report urging UK high streets to be more distinctive to counteract slowing sales and reduced consumer spending.

The report, “21^st Century High Streets: A new vision for our town centres”, sets out a six point recovery plan for town centres and urges national and local government to work with retailers to ensure that retail failures do not bring down previously functioning high streets. The report shows a deeper level of thinking than government plans announced by (then) Communities Secretary Hazel Blears back in April.

“Tipping point” fast approaching

The report warns that a “tipping point” is approaching and immediate action is required. At the current rate, business failures and lack of new capital investment is likely to leave an even bigger hole in the high street. BRC estimate that the level of vacant premises will hit 15% by end of 2009, up from 7% in January.

Distinctiveness and identity

Central to the recovery plan is developing a sense of local identity on the high street, “The distinctiveness of many town and city centres is an asset, not an impediment. New developments can be complementary to existing features rather than seeking to homogenise surroundings.”

Place making

In addition the report highlights the importance of attracting customers, BRC suggest a more holistic approach combining retail, entertainment and cultural events that maintain local identity.  “Communication and marketing are key elements in developing an effective sense of place. People living within reasonable traveling distance need to be able to recognize and identify the essential nature of a high street.”

Most visible sign of recession

The high street provides the most obvious sign of recession. Shoppers unable to ignore increasing numbers of vacant units are likely to lose more confidence in the economy, accelerating decline. This downward spiral needs to be broken if high streets are to recover. For this to happen stakeholders need to work together to create a new vision for high streets across the country.

To read the full report click here.

“Trust” brands look to steal customers from high street banks

News this month highlights that recession creates opportunity on the high street for “trust” brands. Stefano Pessina, executive chairman and chief executive of Alliance Boots, owner of Boots the Chemist announced plans to split his role to focus on strategy, developing the Boots brand and increasing sales.

Brand development

Quoted in the FT, Pessina explained his reason for looking to develop and extend the brand, “We are in a market that is not growing by 20 per cent a year … and we have to add services; we have to be very active in order to offer more and more to customers and we have a lot of ideas. We are working on certain ideas.”

With Tesco planning to enter the financial services sector, speculation is, Boots will follow. Given the total breakdown in consumer confidence in the banking sector due to taxpayer bailouts, a culture of excess, and greed, consumer-centric retailers spot an opportunity to leverage the trust imbued within their brands.

Financial services loss of trust

Two recent surveys illustrate depth of problem for high street banks. Moodier Britain survey, published by McCann Erickson in November 08 (before extent of banking collapse was apparent), found that nearly 25% of respondents – total sample of 1028 adults – had no trust in banks.

More recently Readers Digest Trusted Brand Survey 2009 shows that across 16 European countries trust in banks has fallen 39% in 12 months, and 57% in the UK alone.

“Trust”, increasingly important in a down turn

It appears having no financial services experience is no longer a barrier to enter the sector. Banks have illustrated that expertise is no guarantee of expert performance. While Boots would be untested, they have demonstrated for decades that they can be trusted to look after the health of the family. These most simple values are set to challenge the current banking status quo as consumers turn their backs on organisations that appear to be uncaring and led by shareholder profit.

New players

In a recession “trust” will become more important as it guarantees loyalty and in turn sales. While banks try desperately to save their businesses and prove that they are no longer out of step with their consumers, new players are set to trial, improve, and then challenge their lofty position.

While there wasn’t a run on any UK banks, expect a run on their customers if the likes of Boots and Tesco decide to try and steal market share.