Last week was a sad one for retailers and the fallout is likely to continue for some time. The demise of Austin Reed was followed swiftly by the announcement that BHS administrators had failed to find a buyer for the chain, leaving the industry – and thousands of BHS staff – reeling.
Both businesses had, unfortunately, become out of date and out of touch with the customer. Neither had a clear idea of its brand, what it should sell and who should be buying it. Heritage is not enough – you need to keep up with changing consumer shopping habits to survive in these challenging times.
Of course, a multichannel strategy is now important, but it is also important to remember one of the fundamentals of retailing – and one that has not changed over the years since BHS and Austin Reed were founded: product is key. Other than children’s school uniforms and the lighting selection, BHS had no clear product offering. The brand did not stand for anything any more. At best it evoked a sense of fond nostalgia.
Neither BHS nor Austin Reed had a clear idea of its brand, what it should sell and who should be buying it
No one wants to see a business fail, especially when it means the loss of so many jobs. The only silver lining is that it could give others a chance to open in towns that align with the customer need there. Many BHS customers also shop at Marks & Spencer, Debenhams and Next. The customer base is mainly female (68%) and in the 45-to-54 age bracket, Verdict reports. So there is an opportunity for BHS’s rivals to increase their market share.
Austin Reed succumbed to the same fate as BHS for the same reasons: its 120 stores and online presence have not evolved quickly enough. Other suiting specialists, such as Moss Bros, have worked hard to overcome these challenges by refitting stores, investing in infrastructure and systems and providing an integrated multichannel experience.
Edinburgh Woollen Mill has bought the Austin Reed and Country Casuals brand names and stock. Both, but in particular Country Casuals, could fit very snugly into the Edinburgh Woollen Mill product mix. The fate of womenswear brand Viyella, which was also part of the Austin Reed Group, is less certain. Drapers understands Austin Reed’s owners hold the licence for Viyella, and are still seeking a buyer. Keep an eye on drapersonline.com for updates.
Product offering, brand image and operations are vital to any retailer, but you must also put the customer at the heart of everything you do. Retailers are changing strategies to be customer- rather than channel-centric and the introduction of new roles such as chief customer officer highlight this. Fall out of touch with your customer and you could find yourself out of business.