UK Retail Eyes Strong Growth
Commentary by Liz Parry, Teleperformance UK.
The British Retail Consotium (BRC) just published new data indicating that retail growth in the UK is stronger than it has been for a long time. Total spending in June was up 2.9%, which is the strongest monthly growth since January 2014.
The BRC cites several reasons for this strong uptick in retail data, but one of the most important factors appears to be the weather. Outdoor toys and summer clothes all sold well because summer did actually arrive, helping to boost retailer numbers.
But in other news, the media is reporting how the British budget might affect retailers – in particular the announcement that the UK minimum wage is set to increase to what the government defines as a ‘living wage’. Credit rating agency Moody’s has already predicted that this will either increase retail prices as retailers pass on the cost or it will result in job losses.
The signals are not good. However one might argue that if every retailer needs to conform to the same new pay scales then all will be equally affected, so perhaps Moody’s is too gloomy? However, I’m also concerned that something as ephemeral as the summer sun can have such a dramatic effect on the overall retail industry too.
In all this talk of the minimum wage and sunshine boosting profits, I think the bigger picture is being lost. UK retail today is changing dramatically. Not just because of the multichannel expectations of customers today, but even the expectations of the in-store customer.
Younger customers have changed the way that they communicate with friends and family because of the mobile Internet and social networks. Retailers need to understand that this recasts the in-store experience too.
Customer service is no longer about fetching and carrying from the back of the store or just processing a payment. Customers are expecting the in-store team to have a detailed knowledge of the products they are selling and to be able to advise on anything from the best pair of shoes to the right tablet for reading books.
Smart retailers understand that connecting their information-rich online service with chat support and product reviews to the in-store experience is a critical part of understanding how customers shop in 2015.
Getting this new model of customer service right is going to define who succeeds in British retail over the next few years – not how much sun the country gets in summer.
