After reading the continued bulletins of doom and gloom in the national media, I decided to take a couple of days out of the office this week to form my own view as to future trading prospects.
I was pleased to see a reassuring number of consumers out and about spending, but intrigued by where the tills were ringing. It appears that what we read in the press is completely true. The middle ground is hell and those stuck in it are facing continued misery.
As Tesco reported its worst Christmas trading performance for 20 years, one analyst described the brand’s problems perfectly by concluding that it has become stuck in no man’s land. Picked off by the likes of Waitrose on quality and by the discounters on price, Tesco is the new Sainsbury’s.
It is a timely reminder to us all that during boom times we must always be aware of the inevitable pincer movement. Being bigger and more dominant does little to protect you – if anything it makes you a whole lot more vulnerable.
As La Senza, Peacocks, HMV and a whole host of other high street strugglers either enter or fend off the threat of administration, it is telling to look at what happened to Woolworths stores. Most are now pound stores with sector leader Poundland reporting 25% annual sales growth due to this timely expansion and even returning a 6% rise in like-for-like sales at its existing locations.
As part of my retail audits, I visited out-of-town factory outlet Bicester Village. I haven’t been there for a while and couldn’t help but notice the new sign as I arrived, which read: Bicester Village Chic Shopping.
The place was busy, demonstrating that Bicester has got it right with its designer brands at discount prices proposition.
I was staggered by the number of Chinese tourists who were giving their credit cards a good workout. Bicester buses them in daily from central London hotels with the promise of chic shopping for a £23 return fare, which is smart marketing in anybody’s book. Even the ads in the outlet’s toilets are scripted in Chinese. I admire Bicester Village management’s clever segmentation and proactive approach to getting valuable customers through its doors.
Meanwhile, Waterstone’s obsesses about whether or not it should have an apostrophe in its logo. God help it…