Topshop, Debenhams, Marks & Spencer and New Look have been named as the latest UK high street retailers most likely to enter the “retail graveyard”, a group of retail analysts has said.
Conversely, Zara topped the list of physical retailers for high performance, followed by Selfridges and Aldi.
The panel, led by senior retail adviser Andrew Jennings, judged major retailers on the basis of the quality of their customer service, effective inventory management, use of technology and more.
The “survival of the fittest” judging panel comprised Jennings; retail analyst Richard Hyman; CEO of Retail Economics Richard Lim; director of Coverdale Barclay and former deputy chair of the West End Marketing Alliance Ros Barclay; and retail journalist John Ryan.
The judging criteria came from Jennings’ book Almost Is Not Good Enough. The results were largely in line with the retailers’ commercial performance.
For example, JD Sports and Zara reported the highest revenue growth over the previous year in the list of fashion and lifestyle retailers (32.9% and 16.95% growth respectively, company reports reveal).
Of the fashion and lifestyle retailers scored, Topshop and New Look had the lowest revenue growth in the previous year, which was matched by the lowest score from the judges.
Selfridges, the judges’ highest-scoring department store, reported a 14.56% revenue growth in the previous year compared with John Lewis’ 1.77% revenue growth and Debenhams’ -2.48% revenue growth.
Jennings commented: “Retailers nowadays are under serious pressure, particularly those that are not focused enough on staying relevant. It is important to understand why these businesses have underperformed, to assist other retailers facing similar issues and ensure they do not take the same disastrous route. Those that understand their customers and are constantly innovating and adapting to change will do well.
“That’s why I wanted to bring together a team of thought leaders in the industry, to discuss which retailers understand this, and spotlight those that are not getting the basic foundations of successful retailing right.”
Four pure-play etailers were also assessed: Amazon, Asos, Net-a-Porter and Boohoo.com, all of which scored highly.
Jennings added: “It’s not a case of ‘online versus offline’. The retailers that are thriving are those that offer an effective and engaging omnichannel experience. In many ways, etailers have an advantage. By their nature, it is easier to understand their customers’ needs, wants and desires as they have a breadth of digital data at their fingertips. Physical retailers need to consider what they can learn from this, to deliver an effective in-store experience.
“It is also interesting that many of the higher scoring stores are those with a fewer number of locations in their portfolios. They can tailor their offer better to the local markets. We are seeing the likes of Debenhams and Marks & Spencer cutting back on their store portfolios because customers are no longer interested in a ‘generic’ in-store experience. Shops and department stores must embrace these changing customer preferences.”