Entertainment retailer HMV has announced that it will be going into administration this morning, after almost 100 years of trading. Experts point towards the brand’s failure to develop a competitive online offering as a major factor in the HMV’s financial struggles, leading to a renewed emphasis on the importance of modern high street retailers embracing e-commerce.
Reflecting on the news, Neil Saunders, Managing Director of retail research company, Conlumino, commented;
“The blunt truth is that HMV did not react early enough to the digital trend; it did not give shoppers a reason to keep buying from it.”
An insufficient e-commerce offering clearly placed HMV in a position of risk; the rapid uptake of e-commerce led to over £1 billion worth of download sales last year. However, with the continued growth of online retail, which now represents over 10 per cent of all consumer spending, other high street brands may also be in danger of a similar fate in the near future.
In light of this situation, Andrew Sentence, a former Bank of England committee member, advises;
“Retailers which can realise the cost and convenience advantages of multi-channel retailing will be much better positioned to achieve sales growth and protect profit margins than those locked into large legacy property portfolios.”
In the current retail climate, though, truly profiting from the flourishing online market requires more than simply creating a digital outlet for a brand’s products or services. To remain competitive, retailers must now ensure each of their different sales and marketing channels are streamlined into a consistent consumer journey.
To achieve this, businesses must first be able to track their consumers across the various brand touch points, delivering the same level of personalised customer service no matter how each consumer chooses to connect with the brand. Amongst other trends, CIM specialists predict that 2013 will see a number of major retail brands acting to better integrate their online and offline presence, in an effort to avoid following in the regrettable footsteps of HMV.
Follow the numero blog for all the latest news on how British brands are acting to improve their customer interaction management services.