15 Oct 2020
As a town planning consultant with a passionate interest in successful places, I will never accept that the high street is dead. And if you take a look at our blog series – the High Street isn’t dead, long live the High Street - I am clearly not alone as many of my colleagues think the same.
From the title of this blog you may be forgiven for thinking that I am about to set out my thoughts on the rise of internet shopping – but, no, that is a subject which has been well covered elsewhere. In fact, what I would like to discuss in this blog are the opportunities for the high street which are emerging through increasing use of technology, particularly by younger generations.
Young people’s relationship with the internet and social media is agile. In 2019, the ONS found that 100% of 16 to 24 year olds access the internet on a mobile device and, unsurprisingly, this age group engage very actively with social media (98%) and are highly adept at finding out about information on goods and services online (84%). It is clear that young people are actively using the internet when shopping.
Last year, Lichfields undertook a survey to try and develop a better understanding of young people’s habits and how they use town centres. The research – which was based upon a survey of around 230 young people aged 16-25 - uncovered a number of trends, which can be read in more detail in our latest insight focus – The next generation: the future of our town centres. One of these trends was young people’s interactions with technology and the high street.
The results of our survey indicated that, through their use of technology, 39 per cent of respondents were ‘very’ or ‘quite likely’ to share their experience or interact with a venue in the town centre on social media once they had visited. This suggests that a high proportion of young people take to social media to talk about their high street experiences, and highlights the importance of social media channels as platforms for town centre operators and businesses to promote themselves online to their target audience.
Respondents also said that they found out about things happening in their town centre using Facebook (60 per cent) and Instagram (41 per cent). This extended not only to new stores or venues, but also other ‘pop up’ events and markets taking place.
As we live with COVID-19 there is now an increased focus on social media as town centre businesses and other stakeholders look to re-connect with potential customers and showcase goods and services. While some businesses will seek to promote their offer on a national scale, including through online advertising, there is also scope for businesses within town centres to take a co-ordinated approach through a central body (such as a business improvement district). This ability to communicate directly with customers in a live setting is likely to be increasingly valuable as the high street looks to bounce back and build trust with its returning customers.
How important will retailing be in town centres of the future?
We know our high streets have experienced significant change as a result of shifts in shopping patterns and that COVID-19 has acted as a catalyst, resulting in seismic changes to shopping and working patterns over a very short period of time. As a result, many town centre stakeholders are currently looking at how the high street might look in a new era, with changes previously planned for the next decade now being taken today.
In our survey, 59% of 16-25 year olds said that one of the main purposes behind their visit to a town centre was to eat out, compared to 46% who referred to ‘browsing the shops’ and ‘shopping for non-food goods’. Whilst eating out experiences may have surpassed shopping in this survey, shopping still plays a role in why young people visit a town centre.
Young people are omni-channel shoppers and this has a significant influence on how they use centres. Unlike previous generations who relied upon shopping in person, younger people now use multiple channels to meet their shopping needs, blending different channels to maximise personal convenience. This often involves a visit to a town centre (e.g. to browse or to collect goods) even if purchases are actually made online.
Indeed, 60% of the respondents to our survey indicated that they would still use town centres in one way or another when shopping for non-food goods. This would suggest that young people see online shopping as complementary rather than as a substitute for visiting the high street.
So, what does this mean for the future of our town centres?
Rather than focussing on the past, we need a better understanding of the needs of consumers of the future – and, in particular, we need to continue to take account of young people’s habits and preferences. Their online interactions with high street businesses and other organisations provide an insight into how we can expect to see the high street of the future. Young people want something different from previous generations, something that is more of an experience that offers a range of uses and attractions. Retail is a key part of that, but it’s not the dominant element.
Understanding how technology works and how young people want to interact with town centres both online and in person is unquestionably important and will be key to success in the future. While it is easy (and perhaps understandable) to focus in on the threat presented by online shopping, the reality is that digital channels, and social media in particular, offer huge potential and the successful town centres of the future will be those with an embedded digital strategy which drives both interest and footfall.
05 Mar 2020
See Lichfields' "Budget 2020 - getting it done" Economic outlook for reactions and analysis of Rishi Sunak's first Budget speech.
Rishi Sunak’s ministerial red box was already overflowing when he took office last month – handed the keys to Number 11 at short notice following the resignation of Sajid Javid – and it has been a tumultuous three weeks since. With coronavirus now weighing down heavily on the global economic outlook, the early tetchy stages of the UK’s negotiations with the European Union on future trade underway, and speculation of interest rate cuts later this year, the Chancellor may well be turning to his preferred brand of Yorkshire tea leaves for guidance.
Given the macroeconomic uncertainties, HM Treasury officials are reported as saying that next week’s Budget will be the first installment in a “trilogy” of statements this year – something for the aficionados to relish. Some decisions on tax, spending and borrowing are likely to be pushed back to the autumn, a year after last November’s Budget was itself postponed due to the general election.
However, the Budget is one of the key set pieces of the parliamentary calendar, and is particularly important in the context of a new government keen to deliver quickly on its manifesto promises. So what might the Chancellor’s red box hold in terms decisions on planning, infrastructure and regional economic policy? Here’s a round-up of 10 key points to look out for next Wednesday:
Economic growth – tea leaves aside, the Office for Budget Responsibility (OBR) – the independent fiscal watchdog – will publish its latest UK economic forecasts alongside the Budget. It is widely expected that the OBR will downgrade their forecasts from those published in March 2019. This matters because it would result in higher forecasts for government borrowing and, in theory, give less bandwidth to increase public spending if the Chancellor also wants to limit tax increases in line with manifesto commitments.
‘Levelling up’ – the phrase that featured prominently in the Conservative election campaign, and is already permeating into the policy sphere (seemingly replacing the ‘rebalancing’ lexicon which became popular in the Osborne and Hammond eras). The Queen’s Speech in December referred to making investments, “in order to unleash productivity and improve daily life for communities across the country.” Following success in breaking the so-called ‘Red Wall’ in the North and Midlands, the government have been clear that levelling up will be a key factor in all future policy and decision-making, so we can expect this theme to be writ large. Practically, this could extend to creating a new hub for HM Treasury officials on Teesside.
Revisions to the Green Book – the ‘Green Book’ (HMT’s guidance for appraising public spending decisions) was an unlikely media star over the quiet Christmas news cycle when it was reported that significant revisions are in the works aimed at boosting investment in the North and Midlands. We considered the implications in an earlier blog. The Budget will provide an opportunity for the Chancellor to set out the details on how this will work in practice, but clarity about how decisions on local infrastructure spending will be decided will be keenly sought from both north and south.
Devolution White Paper – government has committed to publishing a Devolution White paper, promising a review of more directly elected mayors in the mould of the Metro Mayor, and the possibility of more combined authorities and unitary authorities. These policies reflect wider effort to devolve decision-making to the local level. The future of sub-national partnerships such as the Northern Powerhouse, Midlands Engine and Oxford-Cambridge corridor will also depend on any funding and powers devolved to them over the next few years.
Planning White Paper – in the works since being first announced by Theresa May in March 2019, and now anticipated around the time of the Budget or shortly thereafter. A recent Ministerial Written Answer confirmed, “the purpose of the White Paper will be to make the planning process clearer, more accessible and more certain for all users, including homeowners and small businesses. It will also address resourcing and performance in Planning Departments.” It remains to be seen what influence Jack Airey’s (co-author of Policy Exchange’s report in January on ‘Rethinking the Planning System’ for the 21st Century’) recent appointment as No. 10 housing and planning adviser will have on policy proposals.
Local Industrial Strategies – Mayoral Combined Authorities and Local Enterprise Partnerships (LEPs) across the country have been busy preparing their local response to the national Industrial Strategy since 2018 through the form of Local Industrial Strategies (LIS). So far, seven LIS have been agreed and published but some thirty remain in the pipeline still to be agreed with central government. At the very least, an extension to the deadline for nationwide coverage by March 2020 seems inevitable – or potentially a shift to something different as has been rumoured. The Budget could usefully provide some clarity.
Big infrastructure – the recent confirmation of HS2 might signal that the government is moving towards funding big ticket infrastructure investment, relaxing its fiscal rules. Eyes will be on the Budget to see whether this is backed with investment for Northern Powerhouse Rail and an indication on the future of the Oxford-Cambridge growth corridor. A further indication of the priorities of this government might be its omission of major road investment announcements (so far transport infrastructure spending announced has been for trains, busses and cycling), but this will need squaring with the legally-binding target of net zero greenhouse gas emissions by 2050.
Research and development – in the spirit of levelling up, the Prime Minister and his Special Adviser Dominic Cummings are looking closely at R&D funding nationally, pointing out that more than half of the national gross domestic expenditure on R&D is spent in London, the South East, and East of England. This might be through investing into nationally-significant hubs like the “MIT for the North” and the Midlands “Gigafactory”. Options include strengthening the existing Catapult Centres, National Productivity Investment Fund and Strength In Places funds, or through new initiatives.
UK Shared Prosperity Fund – further detail on the plans to replace the £2.1billion EU structural and investment funding, the proposed UK Shared Prosperity Fund, is long awaited. A consultation period is expected before the fund kicks in. While the fund is committed to tackling inequalities between communities by raising productivity in areas of the country that are ‘furthest behind’, clarity is needed to ensure local authorities have certainty over long term funding arrangements in order to effectively plan for future interventions.
Freeports – a key policy for government, given the aspirations for global trade following Brexit. They will operate similarly to enterprise zones but specifically for port areas, in which goods are only charged tariffs when they leave the freeport area. With a 10-week consultation recently launched by the Government aims to announce up to 10 new freeports across the UK at the end of this year to be operating in 2021. The Budget provides the Chancellor with the opportunity to say more about the potential funding and regulatory framework for this initiative.
With a promised dose of new public spending, a significant parliamentary majority and a new phase of Brexit and global macroeconomic developments, next week’s Budget will be significant not just for the decisions made but how this sets the tone for policy and funding for the years ahead.
Lichfields will be providing further comment on the Budget in due course.
Click here to subscribe for updates (opens in email)
Image credit: Rishi Sunak (@RishiSunak)