Retail and the High Street

Debate between Oliver Colvile and Ann Coffey

Thursday 28th November 2013 Westminster Hall

[Ann Coffey (Stockport) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Walker. I am pleased, together with the hon. Member for North Swindon (Justin Tomlinson), to have secured the debate. As co-chair and vice-chair of the all-party parliamentary group on retail, we understand that thriving town centres and high streets are the living face of our communities and vital to their economic and social well-being. Town centres influence how people see, experience and relate to their local areas. They are, and always have been, places where we re-affirm our place in our communities by meeting and talking to each other. The familiarity of the high street can give us a sense of belonging.

Retail is the building block of our high street. More than 3 million people—more than one in 10 UK workers—are employed in retail. In my constituency, retail is by far the largest private provider, and it is responsible for more than a quarter of all jobs. There are many important issues facing the high street, such as employment, retail skills, business rates and rents, finance for small businesses, car parking and town centre management.

Although I do not underestimate the seriousness of those issues, my debate will have a slightly different focus. The visibility of the high number of empty shops scarring our town centres, with one in seven shops empty nationally and one in five empty in the north-west, can give us the impression that our high streets are slowly shutting down. I do not believe that the situation heralds the final demise of the high street, but it demonstrates the extent of the challenge faced by the private and the public sectors to reinvigorate that public space.

The biggest challenge is the impact of online shopping and developing mobile technology. I see that as an opportunity for the public and private sectors to harness those revolutionary technological changes and bring together the physical with the digital to provide more exciting and unique community spaces.

Online sales are set to account for more than a quarter of all retail sales by 2020, and it is predicted that 4,000 retail stores will be lost by 2015. The latest figures from the British Retail Consortium show that in October, online sales of non-food products reached a new record rate of 18.3%. M-commerce grew by a staggering 300% last year alone, and it will rise further. Already, 72% of us own smartphones, according to research by Deloitte, and that will only increase.

Remember the old days, not long ago, when there was only one way to shop? We walked down the high street and into the shop we wanted, spotted the item that we wanted to purchase, bought it and carried it home. With mobile phones, we can now go into a shopping centre, examine goods, scan barcodes, compare goods online, read reviews and buy either in store or online. Developing mobile technology means that in the future, we will also receive real-time, tailor-made messages from companies about myriad offers and discounts in nearby shops.

The thousands of empty shops up and down the country cannot all go back to being traditional shops. As a result of the impact of mobile technology, future town centres will no longer simply be about physical shopping; they will be about socialising, entertainment services and cultural events. That was highlighted by both the Portas report and the Grimsey report.

Many stores are responding to new technology by bringing together online services with physical shops. Many businesses are equipping their staff with iPads or installing kiosks to allow for easy in-store customer ordering. A good example of the bringing together of the physical and the digital is Amazon’s introduction of collection lockers on the high street, which allow people to collect their orders rather than waiting for deliveries. eBay has set up a pilot system allowing “click and collect” orders to be picked up at Argos outlets. John Lewis has already launched a service that allows customers to collect their order from one of 1,500 local Collect+ shops, so customers start their shopping journey online and finish it in the town centre, which creates additional footfall.

Many shops already have free wi-fi for tailored marketing, which also allows shoppers to read detailed reviews and compare prices—something that 33% of smartphone users are already doing. Apps or scanable QR codes and barcodes help stores to target shoppers for special deals and extra branded content on their mobile devices as they browse the shop. QR codes on shop windows can divert custom to a website outside normal opening hours, which is particularly useful for a small shop.

Mobile technology is already transforming our high street, but let us try to imagine what the high street of the future might look like. In Spain, people can already use phone identification to check in to their local high street, after which a host of real-time events and offers flash up on their smartphone to alert them to what is happening there and then. Such technology can even direct people to a free parking space, and Westminster is already pioneering a new app for that. In years to come, we will also see many stockless shops, which aim to sell their brand. In such shops, customers will sit on sofas and view new collections through high-definition touchable holograms, which allow them to feel the texture of a fabric and have an item delivered to their home immediately.

Future technology will identify people from an on-street face recognition account that they can opt into, which will alert key shops and services to the fact that an individual is coming, to allow them to prepare a tailored offer in store. That means that we will receive tailor-made messages and offers as we walk down the high street. Things that seemed ridiculously futuristic a short time ago will be here soon, such as Google Glass, a head-computer worn like glasses, which an individual can speak to. It will project images and information on to the glass, and will function like an interactive search engine. It is difficult to predict the effect of such technological changes on consumer behaviour, but we must understand how transformational they will be.

I have already mentioned the Portas and Grimsey reviews. I think it is unfortunate that they seem to be in conflict with each other, because essentially they both say the same thing about innovation and partnerships. Stockport is a Portas pilot. Our pilot is based on regeneration of our market and Underbank, and it is creative industry-led. It is fair to say that it has been a bumpy ride, but that is what pilots are about. It has illustrated the difficulties faced when two very different cultures—public and private—try to work together. The good news is that footfall is up in the markets, new shops are opening and a unique Stockport brand is emerging.

The pilot demonstrated that we need a different kind of public-private partnership to support regeneration projects based on small retailers and markets. Such projects should always have a business plan based on hard evidence and proper analysis of strengths and weaknesses, to arrive at a unique high street offer for a particular town. If public money is to be spent on business rate relief, buying and letting property to preferred leaseholders, transferring public services to empty shops or converting empty shops to residential use, we need to see value for that money, especially as resources will become increasingly scarce. I would like the Minister to do what he can to spread the evidence from the Portas pilots and similar innovative schemes across the country, to provide local councils with information that will help them develop business plans for their high street. We do not want to be constantly reinventing the wheel.

In Stockport, I am conducting a shopping survey of people who live near the town centre. It is clear that the majority of them use the town centre for small shopping trips, up to five times a week in some cases, during which they also go to the bank or the post office or stop for a cup of coffee. That provides important footfall for the town centre.

[Oliver Colvile (Plymouth, Sutton and Devonport) (Con)]

The hon. Lady makes a strong case, and I have listened intently to her contribution. I should declare an interest, because before I was elected to this place, I did quite a large amount of work in retail development and have retained a share in it.

One thing I am concerned about is that we need to have an impact on local car parking, because we need to encourage people physically to come into the urban conurbations and city centres. If car parking is expensive, as it increasingly is in my constituency, people will be driven away, and they will end up just using technology and failing to visit town centres.

[Ann Coffey]

The hon. Gentleman makes an excellent point. The issue comes up again and again—indeed, it came up in the shopping survey I did. If councils are developing business plans, they also need to take into account the impact of their car-parking charges and whether those will attract shoppers to their town centres, rather than drive them somewhere else. That is an important part of any business plan. Converting empty shops to residential use and into shop fronts for public services seems a good plan, because it will encourage people to shop in the town centre. The presence of banks and post offices is also important in creating footfall—a point made by the Association of Convenience Stores.

The growth of online shopping has weakened many out-of-town large-format stores, and, as a result, there has been renewed interest in the convenience format, with a return to smaller, more frequent shopping trips. That could benefit towns such as Stockport.

In our town, there are many new independent shops. It is good to see them exploring ways of working together and of using the internet and social media, such as Facebook and Twitter, to support their bricks-and-mortar shops. I was talking to a Stockport business that already operates an online store through ASOS Marketplace, which is part of the ASOS fashion retail site. However, independent retailers across the country report that they are struggling to compete with major internet retailers, as they lack the funds on their own for large-scale online marketing and websites to compete with Amazon and eBay.

An interesting response is new websites for independent retailers such as myhigh.st, which is supported by the British Independent Retailers Association. Target 200 is an innovative e-commerce network that gives independent shopkeepers the chance to join together to sell their products online. It also gives towns a platform to showcase what is happening in their high streets. Together with “click and collect” and an independent shops loyalty programme, it enables shoppers to buy online, while encouraging visits in person.

Such innovation may be the way forward for Stockport, bringing an online presence together with the town’s physical shops. In an affordable way, that will give independent retailers additional income through online sales, while showcasing Stockport’s bigger retail shops, its markets—including its specialist markets—and its cultural and heritage attractions. That will encourage more people to visit and shop in the town.

With all the discussion about the demise of the high street, I am really concerned that opportunities are being missed. It is important that councils and businesses join together to use the exciting opportunities offered by mobile technology to transform the delivery of private goods and public services on our high streets, turning them into the exciting community spaces of the future.