Lord Kirkham is unequivocal: bricks and mortar have had their day.
According to his lordship, retailers who look to grow their existing businesses – or launch new ones – by “going down any other route than online” are in denial of the inevitable.
Not so; not in my book. Inditex, for good example, knows a thing or two about growing successful retail businesses. And yes, digital innovations and the proliferation of online options are key drivers in its inexorable worldwide success.
That dull and boring shops are moribund is something no one can deny. But physical stores can still corral our custom and ignite our delight. They don’t even have to be pretty – although many decidedly are (my own favourite four-wall experience is another sumptuous Inditex flagship, that of Massimo Dutti on Barcelona’s Paseo de Gracia).
Take Action for example, with its chain of 1,245 stores that was last Thursday named ABN-Amro 2018-19 Retailer of the Year. This 3i-backed Dutch general merchandise discounter has no transactional online channel but is opening 250/300 stores a year across seven European markets.
The functional stores are well-merchandised and super-cost-efficient. They won’t win any design awards but customers flock there for two reasons: prices and surprises – the former as compelling as the latter are compulsive. I’ve just come back from Amsterdam and once again failed to visit an Action store without making a purchase.
Action is not alone – there’s a community of high-profile offline-only value retailers that also includes Primark and B&M. The latter (which coincidentally shares initials with bricks and mortar) has just acquired Babou, a 95-store chain in France that also has no ecommerce operation.
The fixation that Lord Kirkham and others have with the internet über alles also does a disservice to all those retailers that happily marry their on- and offline operations.
Among the discounters in the States, Five Below truly stands out; its dotcom channel is thriving, but this coming quarter will see Five Below’s current portfolio of 625 stores grow with 50 more openings, including one on New York’s Fifth Avenue even.
The chief executive sees the potential for 2,500 physical stores in the US: a rather different picture from the bricks-and-mortar bloodbath that dominates the retail headlines over there.
“A walk down Pieter Cornelisz Hooftstraat in Amsterdam last week reminded me of just how important it is for luxury brands to showcase and sell their goods in a premium physical space”
Interestingly, Five Below is observing that many of its Generation Z customers now prefer to go into the store to shop and buy; they then socialise their purchases in situ on their smart devices. This does not remotely resemble what we believe teens and tweens are supposed to be doing. Offline can still rock.
At the upper end of the retail spectrum, digital developments and online operations stimulate the most vocal of talking points. Farfetch, for example, is on everybody’s lips.
Stores for the senses
But a walk down Pieter Cornelisz Hooftstraat in Amsterdam last week reminded me of just how important it is for luxury brands to showcase and sell their goods in a premium physical space.
Not just global titans like Prada and Vuitton but niche phenomena such as Shoebaloo or, round the corner in adjacent streets, Vanilia and British haute jeans designer Justin Denham.
These are synaesthetic boutiques where the tactile, olfactory, aural and visual senses harmonise with each other in a way that no tangled web, however worldwide, can weave.
It’s undeniably premature to pen the obituary of the shopping street or mall. The offline route stays wide open.