What should be done to save the high street?

It’s no secret that UK high streets are struggling, with consumer wallets squeezed, and competition from online retail avenues, out of town shopping centres and hyper supermarkets selling an exhaustive range of goods. 

Both independent stores and chains are folding at an alarming rate, with one shop closure per hour in 2012*. Yet in some towns and cities, retailers are embracing innovation in order to win back customers. One growth area is loyalty programmes, where consumers are encouraged to shop and socialise locally by being offered compelling deals and offers to do so.  

Mary Portas’ no nonsense attitude to retail seems to have reignited our passion for the high street. However, while the funding injection available for her ‘Portas Pilots’ and valued business advice should not be sniffed at, there is still a job to be done by the retailers themselves to win back customers. Of course this is not an easy task and for many independents, which have shop-fronts on ghost-town like streets, there now isn’t the footfall to sustain the custom they once enjoyed.

So what can be done? Inherently, the way we spend our money may have changed but the majority of consumers still enjoy the activity of shopping, meaning there is still a requirement for shops on the high street to exist, provided they are enticing and relevant enough to be visited.

As loyalty marketing specialists we work closely with retailers and leisure businesses to create compelling offers and loyalty schemes, which drive footfall. Most recently, on behalf of the Business Improvement District, Experience Guildford, we developed a ‘Privilege’ card which was given to employees of every retail and leisure business located in Guildford town centre. Each card, created with its own unique barcode, can be presented to businesses which are part of the BID, including retailers, eateries and popular leisure spots, in return for an offer, promotion or discount for each cardholder.

Not only does an initiative like this encourage retail sales and loyalty, but equally importantly, the data capture and analysis benefits for Experience Guildford are endless. Via this programme, users of the card can be tracked and their shopping habits assessed – this then over time paints a picture of what people in Guildford want and are prepared to spend their hard earned cash on – the BID team can plan the retail space in the town accordingly, so that it is fit for purpose and likely to have the best chance of success.

Similarly, we helped the Heart of London Business Alliance BID which represents 500 businesses in the Piccadilly & St James’s and Leicester Square to Piccadilly Circus areas, with its own ‘WOW’ privilege scheme.  The programme was an instant success with over £30,000 of revenue secured in the first few months of the card release. 

What should retailers do? The two examples I have given focus on BID programmes, so for any business operating in a town or city centre, my initial advice is for them to contact their local BID or council to see if they are running any similar schemes which they can opt into.

Next, is to look at what stands you apart from your competitors: do you have kerb-appeal to passers-by? Would consumers come out of their way to visit your store? Having a point of difference has never been more important in retail and if you run an independent store then you are better to differentiate your offering with niche products than a competitive price point. Consumers want good value for money but they can get that from the supermarket or online, so having a store which nurtures a passion and offers expert advice and valuable service will get consumers excited.

Reward customers for their loyalty. Cards are an excellent way of doing this and they don’t have to be overly sophisticated if budget isn’t available. Simple stamp cards are effective ways of encouraging customers to return to claim their free gifts and we have seen real success with our free online tool, Social Rocket, which allows anyone to create and run an offer on Facebook.

Do what you can to develop a customer database to keep communicating with your customers – a monthly newsletter with an incentive to come into the business will not only drive footfall but also keep your business right at the front of prospective customer’s minds. It’s worth remembering that it costs five times more to acquire a customer than retain an existing one**.

Lastly, don’t over complicate loyalty offers. Anything too labour-intensive or confusing will turn consumers off. Make it clear they are being rewarded for their support and that your business appreciates their custom with an easy to redeem perk!

*PwC and Local Data company report, Feb 2013

**Extract from the Harvard Business Review ‘The Profitable Art of Service’.


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