shoppers inline

Purpose, proximity, personalisation: a basket of goods for retail success

In a challenging economy, experience, authenticity and playing a role in being a force for good keeps
consumers bought in to shopping their favourite brands.

Covid changed lots of things but a renaissance in local high streets is the unintended consequence of people working more flexibly and spending more time in their local communities. Add in the economic impact of the war in Ukraine on household budgets and a maturing ecommerce segment – retail is a highly dynamic and changing landscape.

Riding the wave of fluctuating conditions, consumer sentiments are shifting. In order to drive footfall, brands’ physical stores must look to offer more tailored user experiences, while simultaneously creating environments that deliver better value for communities and the planet. 

So how can retailers better optimise their estates to balance profit and purpose in this ever-changing industry?

The evolving behaviour of the British shopper

Fast fashion is now under a microscope as consumers recognise that a low initial cost may reflect in a high environmental cost – potentially reversing a culture of throw away fashion. The gleam of instant and cheap may well be coming to an end for something more ethical, local and with longevity seen as a quality.

And as we move through the cost-of-living crisis, many consumers are supressing the urge to swipe the credit card so frequently. Moving towards adopting more frugal mindsets and favouring long-term purchases, both customers and brands are shifting to more sustainable practices. 

When taking an investment mindset, brands are seeking to appeal to the long term aspirations and values of their clientele. Looking at what this means for the high street, ISG brought together a panel of industry experts to discuss how purpose and ‘moments that matter’ underpin our high street revival.

There is an acceleration in a sentiment shift towards community and caring more about the space we live in. ‘Moments that matter’ event panellist, CACI’s Alex McCulloch, believes that “ESG will become even more important with the cost-of-living squeeze and it’s incumbent on brands to review how they positively engage with society. There’s a collective desire from both parties to do the right thing.”


Sustainability’s role in quality perceptions and consumer sentiment

With perceptions around ‘sustainably sourced’ and ‘local craftsmanship’ associated with better quality, durability and longevity, consumers are justifying product costs, even at a premium,  if they believe they are making a more informed decision that will withstand the test of time. 

The graphic below takes findings from ISG’s The power of place: the true cost of inaction report, showing that net zero accreditations are cited as being most important to landlords and investors in the retail, hospitality and leisure sectors (versus other industries). This highlights how sensitive this market segment is to customer perception and maintaining positive brand reputation.


"Landlords and investors in the retail, hospitality and leisure sectors cite the most precedence on net zero accreditations perhaps owing to the demand from occupying brands whose reputations are sensitive to consumer perceptions."

The impact of the fashion industry on waste to landfill and the associated carbon emissions of bulk manufacture is seeing a rising consciousness around the ‘S’ in ESG; with many customers turning towards community and sustainable retail models. A growing number of shoppers are actively seeking out smaller businesses and local community organisations that give back and boost local economies, favouring brands with reputable values and respectable supply chains.

The impact of physical space on purchasing decisions

We know that consumers are focusing more on emotional sentiment, but how does this translate to the physical world?

Online reviews and the simplicity of online shopping from the comfort of our living rooms are important and play a part in purchasing decisions. But sensory and community connection also plays a crucial role. And the in-store sensory experience either alone or with others, cannot be replicated from behind a screen.

ISG’s research examines how our interactions with the built environment and the associated purpose it serves in our lives has changed. Every touchpoint between brand to consumers must be a physical embodiment of brand values and promise.

Taking the company ethos and spirit and translating into a customer experience is something that cannot be achieved by online platforms alone. This is why we’re seeing more and more ‘online’ brands, like Gymshark and Amazon, moving their digital offering to real-world estates.

CACI’s Alex McCulloch states that “Shifting back from clicks to bricks might seem contrary to today’s marketplace, but nothing could be further from the truth. When the experience encapsulates brand values as well as services, emotional connections are made and these connections boost sales. In retail, sales are consistently higher in areas with physical stores. Brand awareness drives retention.”

Personalisation for the masses

Building a high street presence relies on brands making user experience a priority. The personalisation of products and services plays an important role in ensuring that brands resonate with individuals and deliver a more tailored experience. 

There is a lot to be said for taking the virtual world to an in-person experience. With social media platforms like TikTok helping amplify the visibility of online brands , the social influencer ecosystem is opening up opportunities for influencers and brands alike to enjoy face-to-face events. From 'pop up’s' to more permanent collaboration spaces, consumers are gravitating towards brands they can build a human connection with. 

Recent history has shown that calling time on physical retail is a bad bet – the explosive nature of ecommerce is slowing as the channel matures and consumers are making purchasing decisions based on a wider spectrum of criteria than simply price or convenience. The physical retail reboot embraces localism, ethics, service, great experiences and values. 

Authenticity now extends to the fabric and physical spaces of retail – as educated consumers recognise and reward those brands with a positive response to climate change, social value and ethical behaviour that extends beyond products and services. Marks & Spencer’s ‘Plan A’ launch in 2007 was a bold move to provide a framework for sustainable operations. A decade and a half later, many retail brands are recognising what a pioneering decision this was. 

Retail will continue to be one of our most dynamic and innovative sectors, but one thing we do know is that the physical presence of retail brands will perpetuate.. Spaces built to deliver connections and experience, with ethically produced goods matched to brand purpose will see retailers continue to drive footfall through holistic authenticity.

Brands need to be investing in a physical presence more than ever to have a genuine competitive advantage; prioritising quality and experience to keep the high street open for business for years to come.

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