Tag: Habitat

…It’s businesses blaming the Internet that’s killing businesses.

We have seen more high street trouble in the UK than we have for many years. TJ Hughes, Jane Norman and Habitat closing and Thorntons closing half of their shops. Most seem to be blaming the Internet for their demise.

I think the problems that the design industry itself have had could also be/were also being blamed on the internet.

I’ve claimed it myself with articles that relate to buyers having perfect information and chasing the cheapest price.

But I think it’s simpler than that.

I think customers need three things.

1. Great prices – yes that’s a given. No-one wants to feel like they are overpaying, but i’m not sure it needs to be rock bottom, just equitable with the better prices on the Internet.

2. Differentiated products – A product with a barcode can be tracked and chased for the lowest price elsewhere on the Internet. A product or service that is clearly differentiated by a brand becomes one of one and people will seek it out and be prepared to pay more for it. Just look what Apple have done to Nokia in the last few years. It hasn’t been price driven has it?

3. Amazing service – This is where the real problems have been born in retail and lots of other service businesses. Crap service, inflexible exchange policies or surly staff who make you feel like they’re doing you a favour by speaking to you. Look at what retailers are being raved about online – It’s Zappos, Amazon and those who offer great service as well as good or even best prices.

So we can’t keep blaming the Internet for everything. We have to create better products, better brands and relevant pricing policies.

Then we all win.

Update

I got a note from John Jackson of Retro 36 with another good point to add to this. Firstly he pointed out some of my typos, oops sorry, hopefully corrected now, but also added these points.

“no it’s not just the internet. It’s supermarkets, obscene rent and equally obscene business rates… that’s the real killer.”

So John, I agree, rent is a real issue and business rates are just silly. Some of the rents in the centre of towns an cities must make it impossible for any retailer to make money. Add to this some greedy inflexible landlords and you have a recipe for massive retail failure.

Sadly, supermarkets and their oligopolistic power are a product of our lazy generation and are here to stay for a while yet. Supermarkets were born from bad service, inflexible opening hours and the silly pricing policies that local retailers employed, just as the Internet is doing to them in return.