The beginning of a new year gives retailers a chance to reflect on what they have achieved, as well as the challenges they faced, over the previous 12 months.
At John Lewis, 2015 was the year of the ‘master shopper’ - a consumer who is in total control of how and when they want to shop. For today’s consumer, the online experience needs to be simple and intuitive, delivery low cost and quick, and shops should be inspiring places where they want to spend their leisure time.
Christmas was a flash point for this new retail landscape, with online taking more share of sales than ever before. In 2012, online purchases over Christmas accounted for 25% of our total sales. This year 40% of our total sales were online, with purchases made from smartphones and tablets up 31%. This put the focus on the ability of retailers to ensure their shops, website and fulfilment centres work seamlessly together.
With this trend expected to continue, all retailers are asking themselves whether they should continue to invest in the physical shop estate. For John Lewis, the answer is an unequivocal yes. Shops are at the heart of our growth strategy, for their role as a social destination as much as a place to shop on the go.
Last year, we opened new shops in Birmingham, Horsham and Basingstoke. Our regional flagship in Birmingham, one of our biggest shops outside London, is at the forefront of this new way of shopping. With a beauty spa concept and fantastic catering outlets, it truly is an inspiring destination.
This autumn we are opening shops in Leeds and Chelmsford and both are equally exciting prospects.
However, the most stimulating of shops is only as good as its location. Grand Central, Birmingham, is a good case in point. The new centre is located above New Street station in the heart of the city centre, and has more than 50 million train passengers passing through it every year. It was 95% pre-let at opening, and has just been purchased by Hammerson at a price that reflects the value of this dominant retail destination.
This polarisation of the largest major retail destinations on the one hand, and convenience led by growth in online shopping on the other, looks set to continue for some time.
Shops continue to give ‘bricks and clicks’ retailers a competitive advantage and it is increasingly important that the two work together seamlessly.
This year presents retailers with opportunities to capitalise on the changing consumer dynamics. Those who continue to serve their customers through multiple channels, combining choice, excellent service and a seamless logistics proposition should certainly prosper.
Jeremy Collins is property director at John Lewis