It’s easy to jump to a lot of mistaken conclusions. Retail is very visible and as many manufacturing and service companies have also suffered – it’s just that their profiles are not so high.
One of the assumptions we hear is that e-commerce and the internet is ruining the high street. But the reality is simply that people’s shopping habits are changing. Online shopping, downloading music and movies, and digital technologies are part of the landscape. But these technologies are not that new. E-commerce has been with us for around 20 years. iTunes is part of life. Of course technology is rapidly evolving, but many retail brands have recognised and embraced change, adapted and are flourishing.
It is natural for brands to look outside for their nemesis rather than analyse their own shortcomings. Sadly, established and successful brands become complacent and only notice the changing landscape when it is too late and struggle to adjust. Change is no longer in their DNA.
There is nothing fundamentally wrong with many of these brands, just their strategic management lost direction.
A brand such as HMV has huge value, a history to envy and a unique place in the music landscape. The business model was just no longer robust. The management tried many tactical adjustments but more fundamental change was needed. Perhaps the cold light of administration will focus the thinking. This is a brand with real values that will be snapped up, I’m sure.
Similarly, Jessops. We saw how even Kodak lost its way and failed to come to terms with digital imaging. Jessops has a unique place in retail. Of course, the rate of change caught it out, and it needs the breathing space to reassess itself and re-position its offer. Again the brand has some strong core values and it’s little wonder there is a good deal of interest it – last Thursday, PwC confirmed that Dragons’ Den entrepreneur Peter Jones was among a number of buyers looking seriously into acquiring it.