01. THE HIGH STREET HAS LIFE IN IT YET BUT IT MUST PLEASE PEOPLE TO PROSPER. Around 45 high street stores closed their doors every day in 2019 while only 16 opened, resulting in a net decline of around 5,800 stores in the UK. Combine this with the number of casual dining restaurants and banks that have also closed you get close to 20,000 outlets closing their shutters, in many cases permanently. Fashion retail was by far the hardest hit, but the high street lost many pubs and estate agents too, although if you lived in Walthamstow, as I do, the latter might surprise you! But despite these astonishing numbers the High Street simply can’t die - it’s imperative in building communities and combating loneliness and mental health, and it’s well evidenced that consumers still yearn for new experiences. Unless struggling retailers adapt they will continue to suffer. New technologies, years of austerity, changing shopping habits and rising overheads have all been blamed for the decline in High Street footfall. So, what needs to change? Despite the doom and gloom, there are a few signposts that show us a new way. So, who’s thriving? Lush was a predominately ‘bricks’ brand and, like everyone else, they have had to dramatically cut their stores. They are making their now 100 locations work much harder and last year they opened their biggest ever in Liverpool that includes a florist, spa and hair salon. This, like the rest of their stores, now has a strong focus on customer experience and discovery rather than solely on transactions. In these new experiential stores - driven by friendly, knowledgeable, well-trained staff - Lush have reported 30-50% increase in sales. Speaking of knowledgeable staff, Waterstones famously ‘localise’ their stores, allowing staff to stock books relevant to store location and customer types, and leave handwritten tips throughout the store. It creates a highly browsable experience with customers even grabbing a book and taking a seat before ordering online. Waterstones’ year on year revenue did, however, flatline over Christmas but you could argue it might have declined if they’d gone down the route of becoming a high street warehouse, like many of their failing competitors. It might even be said that Waterstones has been exploited by customers who mourn the loss of too many public libraries since the turn of the century. But humanising your offer and providing a societal good, by design or otherwise, might just be the thing that turns the tide in your favour. Even banks are looking at how they can use their out-of-date premium-priced branches more innovatively and appeal to old and new customers while they’re at it. Yorkshire Bank’s B Works offers businesses and entrepreneurs a place to learn, work, book private meeting rooms and even yoga classes. I haven’t been to a branch in years and back then I wouldn’t have expected my next visit to a bank to have involved a downward dog. IT'S TIME TO ACT. CONSUMERS ARE READY FOR A NEW ERA OF RETAIL. ARE YOU? High Street fooall has fallen to its lowest ebb. New technologies, years of austerity, changing shopping habits and rising overheads are all geng the blame. What can we learn from experienal design, digital and the rise of subscripons to reinvigorate our endless roads of ailing retail? Murray Sim, Fluxx, 2020 01 FLUXX EXCHANGE A NEW ERA OF RETAIL 02 Spotlight: Last summer, Fluxx was approached to help one of the world’s most famous chocolate brands and their customers to co-create indulgent treats of the future. Running a series of stale focus groups in characterless offices is not our jam so instead, we designed and built a pop-up shop within one of our client’s flagship stores in New York. Visitors to the store got a treat they weren’t expecting as we invited them to give feedback on exciting new chocolate concepts directly to the apron-clad packaging engineers, nutritionists and R&D specialists that had designed them. We discovered that testing new products with real people in actual stores they’ve chosen to walk in to can be a rich and valuable experience for the company and for the customer that creates excitement around a brand in a new way and can contribute to an enduring relationship. 02. CLICKS ADDING BRICKS. Most established brands were slow to embrace the digital revolution; clumsily cobbling together their version of an “online shop”. Many still haven’t recognised the need for seamless digital experiences that knit together with offline. Yet younger, digitally native competitors have quickly recognised that a physical store offers their I wouldn’t have expected my next visit to a bank to have involved a downward dog. "
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01.
THE HIGH STREET HAS LIFE IN IT YET BUT IT MUST PLEASE PEOPLE TO PROSPER.
Around 45 high street stores closed their doors every day in 2019 while only 16 opened, resulting in a net decline of around 5,800 stores in the UK. Combine this with the number of casual dining restaurants and banks that have also closed you get close to 20,000 outlets closing their shutters, in many cases permanently. Fashion retail was by far the hardest hit, but the high street lost many pubs and estate agents too, although if you lived in Walthamstow, as I do, the latter might surprise you!
But despite these astonishing numbers the High Street simply can’t die - it’s imperative in building communities and combating loneliness and mental health, and it’s well evidenced that consumers still yearn for new experiences.
Unless struggling retailers adapt they will continue to suffer. New technologies, years of austerity, changing shopping habits and rising overheads have all been blamed for the decline in High Street footfall. So, what needs to change? Despite the doom and gloom, there are a few signposts that show us a new way.
So, who’s thriving?
Lush was a predominately ‘bricks’ brand and, like everyone else, they have had to dramatically cut their stores. They are making their now 100 locations work much harder and last year they opened their biggest ever in Liverpool that includes a florist, spa and hair salon. This, like the rest of their stores, now has
a strong focus on customer experience and discovery rather than solely on transactions.
In these new experiential stores - driven by friendly, knowledgeable, well-trained staff - Lush have reported 30-50% increase in sales.
Speaking of knowledgeable staff, Waterstones famously ‘localise’ their stores, allowing staff to stock books relevant to store location and customer types, and leave handwritten tips throughout the store. It creates a highly browsable experience with customers even grabbing a book and taking a seat before ordering online.
Waterstones’ year on year revenue did, however, flatline over Christmas but you could argue it might have declined if they’d gone down the route of becoming a high street warehouse, like many of their failing competitors. It might even be said that Waterstones has been exploited by customers who mourn the loss of too many public libraries since the turn of the century. But humanising your offer and providing a societal good, by design or otherwise, might just be the thing that turns the tide in your favour.
Even banks are looking at how they can use their out-of-date premium-priced branches more innovatively and appeal to old and new customers while they’re at it. Yorkshire Bank’s B Works offers businesses and entrepreneurs a place to learn, work, book private meeting rooms and even yoga classes. I haven’t been to a branch in years and back then I wouldn’t have expected my next visit to a bank to have involved a downward dog.
IT'S TIME TO ACT. CONSUMERS ARE READY FOR A NEW ERA OF RETAIL. ARE YOU?
High Street footfall has fallen to its lowest ebb. New technologies, years of austerity, changing shopping habits and rising overheads are all getting the blame. What can we learn from experiential design, digital and the rise of
subscriptions to reinvigorate our endless roads of ailing retail?
Murray Sim, Fluxx, 2020
01 FLUXX EXCHANGE A NEW ERA OF RETAIL 02
Spotlight:
Last summer, Fluxx was approached to help one of the world’s most famous chocolate brands and their customers to co-create indulgent treats of the future. Running a series of stale focus groups in characterless offices is not our jam so instead, we designed and built a pop-up shop within one of our client’s flagship stores in New York. Visitors to the store got a treat they weren’t expecting as we invited them to give feedback on exciting new chocolate concepts directly to the apron-clad packaging engineers, nutritionists and R&D specialists that had designed them. We discovered that testing new products with real people in actual stores they’ve chosen to walk in to can be a rich and valuable experience for the company and for the customer that creates excitement around a brand in a new way and can contribute to an enduring relationship.
02.
CLICKS ADDING BRICKS.
Most established brands were slow to embrace the digital revolution; clumsily cobbling together their version of an “online shop”. Many still haven’t recognised the need for seamless digital experiences that knit together with offline. Yet younger, digitally native competitors have quickly recognised that a physical store offers their
I wouldn’t have expected my
next visit to a bank to have
involved a downward dog.
"
Unfortunately for me, just by asking the question I am now tempted by several of the subscriptions I’ve been introduced to, although the seven I already have make enough of a dent as it is. While some of these subscriptions may take us to the high street (the gym, for instance) others are keeping us from it by serving us the very things we used to go there for.
Subscribers are currently more likely to be younger women and around 40% are very quick to cancel if a superior end-to-end experience appears or if a high-quality product isn’t delivered.
But subscription-based products are not new. Far from it. In basic terms, insurance was probably one of the first services broken down into regular instalments with magazines being the first productised subscription service. In 1898, Ladies’ Home Journal became the first American magazine to reach one million subscribers. Netflix then went on to revolutionise how we consume entertainment in the same way; first DVDs and now streaming.
So, who’s in a winning cycle?
At only 10 years old and with 2.5 million subscribers Birchbox is leading the way with a business model that is more interesting than most. Customers are essentially sent sample beauty products every month in the hope that something will take your fancy enough for you to purchase the full-size version. An incredible 50% of customers do just that.
Two former Unilever employees are hoping to take on their ex-employer and
other major labels by delivering laundry tabs in the post. Claiming to be 50% cheaper than their rivals it’s too early to judge Smol’s financial performance, but they have already started to diversify - you guessed it - dishwasher tabs!
The growth and opportunity stats for subscriptions are astonishing, however, it would be wrong to ignore some of the warning signs.
Birchbox’s investors are struggling to cash out as potential investors see them as just “peddling samples” rather than becoming a “proper” retailer. HelloFresh, founded in Berlin in 2011, looks to be storming the meal box market with 2.3 million subscribers worldwide. But despite this staggering growth, they’re struggling to turn a profit due to low customer retention. Independent analysis shows only 50% of subscribers stay on after their first week and only 10% of customers stay after 6 months. After 2 years I’m still technically a ‘subscriber’ but I haven’t paid for a box in 18 months. Many start-up subscriber brands are being heavily criticised for their heavy use of packaging, something that ultimately cost HelloFresh my business.
customers an opportunity to try, test and experience in a way that they can not while shopping online. But unlike their older counterparts, store staff aren’t incentivised on store revenue but instead on online sales.
So, who’s clicking and bricking it best?
Away, the luggage designer and manufacturer started selling online before opening small, perfectly designed retail spaces. It sounds simple, but providing a space that enables customers to wheel a carry on up and down the store before ordering ‘in-store online’ (and delivered home within 24 hours) makes all the difference. There’s even a giant departure board so you can pretend to be in a panicked rush!
Digital beauty brand Glossier has now opened a small number of “showrooms” that provide shoppers with a beautifully luxurious space to test products, get makeovers and seek beauty tips and advice. In London, the announcement of a 3-month pop-up was met with much excitement as the thousands of their social media followers reacted to the news. It was they that had brought the cult make-up brand to these isles in the first place and the highly instagrammable shop, inspired by London’s social clubs and complete with glitzy rooftop, did not disappoint.
03.
BUYING ON AUTO-REPEAT.
The subscription market has grown by more than 100 per cent a year over the past five years - we are a clearly a nation that is revelling in accessing curated content, music, fashion or beauty products or simply being able to replenish day-to-day essentials that save time and money.
A quick poll of 20 of my Fluxx colleagues that revealed some interesting insight into what makes them tick also surfaced 130 active subscriptions (that they could remember, for there will be several more that they have forgotten about but will be still be paying for). Just by answering the question many of them are now reevaluating their life choices.
03 FLUXX EXCHANGE A NEW ERA OF RETAIL 04
04.
DIGITAL IS MORE THAN ONLINE SHOPPING.
Digital isn’t about online shopping — it’s about customers. It’s about meeting (and exceeding) their expectations and their needs, and about the business processes that will help you anticipate and service those needs.
A business with serviceable e-commerce, but that doesn’t understand its customers, sells out-of-step products, offers clunky services and a disjointed in-store experience is heading for trouble.
A slick online shopping experience will satisfy some customers, sometimes. But how will you gain feedback? How will you revise products to keep pace with trends and lifestyles? How will you deliver experiences that add value to those products? How will you anticipate customers’ needs, before they arise? And how will your brand build a customer relationship based on something other than convenience or price?
Digital is an opportunity for retailers to organise around customers. Anticipating and serving their needs and working in ways that help them adapt. Prioritising this above optimised costs.
In stores, shoppers will witness this shift. Most stores’ current metric — sales per square foot — assumes that customers visit stores to find the item they need and buy it there. This results in stores crammed with merchandise. But stores organised around customers will allow them to try, test, customise, measure, share, and repair — jobs that physical retail and adept service are still best placed to deliver.
Digital means organising around customers’ needs and adopting new ways of working. Online shopping is the tip of the iceberg. It points to a new era for retail.
WHAT IF: THE LIVING HIGH STREET.
We have a vision for a new kind of high street experience. It combines innovative new formats that create relevance in the e-commerce era, with staff who are empowered to collaborate to add value to local people and businesses.
The Living High Street is the central area of a perfectly normal British town. 30 years ago it was the vibrant centre of the community. 3 years ago it was a ghost of its former self, abandoned for the brutal convenience of Amazon and the all-day, any-weather lure of the out of town shopping palace.
But something remarkable is happening here. Several big retailers have decided to work together to try something new. And what’s really special is what their people are doing. What their people are being allowed, enabled and inspired to do. They’ve realised that the high street will only work if they work as a team, thinking about the whole experience.
Together they’re bringing the Living High Street back to life. Making it feel welcoming, useful, fun. Making it a destination, at any time of the day. Making it a service to the local community. Making it into a platform that supports local businesses.
A BIT ABOUT THE AUTHOR.
10 years ago, I made the move to London with the promise of one week’s work. What I left behind, other than a handful of freelance design clients, was a bitterly cold flat and three high street service jobs that at least were keeping my head above ground.
A product designer by degree, I spent a few years designing services for Geordies, making flat whites for Sydneysiders and serving gin and tonics to Glaswegians (in that order) before London came calling. Nothing pleases me more than a well-designed service that delights its users (and nothing winds me up more than a bad one - just ask my long suffering wife!) and it’s time served in aprons and behind cafe counters that I have to thank for that.
At Fluxx, I get to help people from all over the world design new products and services in categories as varied as premium chocolate and car insurance. It’s richly rewarding and inspiring to work with thought-leaders and change-makers in industries that create the things we use every day. Being able to shape these things in new ways is a privilege I never take for granted.
I do miss making coffee though.
There’s even a giant
departure board so you can pretend
to be in a panicked
rush.
"
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