Opinion: Adapting to dynamic markets might be tricky for the High Street, but it would help if we could get through the doors
Almost as soon as it was acknowledged that the business was in trouble, HMV announced that it had gone into administration.
It’s a swiftness of action that was sadly lacking in other areas of HMV’s business.
It can seem a bit like sticking the boot in to point out a retailer’s perceived flaws once it has popped its clogs, so I’ll start by saying its real shame what’s happened, especially considering that it means 4000 jobs could go.
But is it particularly surprising? Not really. Any punter on the street could give you a list of reasons of why its business was struggling – this isn’t the complex world of collapsing domino financial structures that led to Northern Rock’s demise, which most people had to take the expert’s word on.
HMV used to make a lot of money out of records and then CDs, things for which demand has massively waned. It diversified of course, but largely into more physical disks – DVDs and games – which are now subject to the same threats as music – downloads, etailers and supermarkets.
It’s scarcely worth pointing out that the internet has delivered a huge blow to HMV – but could it have done much about it?
There is some evidence to suggest that despite it’s monolithic standing in the Eighties and Nineties, it simply never considered converting that success into a leading online operation a priority. Certainly it's safe to say it’s never packed much of a punch online, despite being such a massive player in traditional terms.
Companies like Play and Amazon were more than happy to fill the gap.
Not all chains have remained so static over the years. Waterstones (previously bought by HMV during its golden years), having taken on James Daunt as new MD, started selling Amazon Kindle’s in-store, while simultaneously describing the company as the enemy. It has also spent a lot of money of making lots of cafes and nice things in store – shoring-up the benefits of physical shopping while trying, in some way, to step in line with the disruption of e-readers. It’s not a play that you can say is a proven model for success yet, but at least it is a play.
HMV stores now are more or less identical to what they were ten years ago. And in that time, the music industry has changed even more so than the book publishing world.
The fact is these days most people will download a song rather than go and buy a CD single. Physical CD sales are approaching a niche category – and you don’t have many massive nationwide chains supporting niches.
Digital music presented an easier, cooler, more dynamic, often cheaper way of consuming than CDs, so it became very popular. HMV, like Virgin or Zavvi before it, never really moved with that change in consumer buying patterns. It might be that it would be difficult to do so, but the same arguments lamenting the rise of the internet a as the grim reaper would still have HMV selling vinyl records and the gramophones that sit in its logo.
The point is there is always someone to blame – independent stores often blame chains like HMV for their woes. Whether it could have adapted effectively and make money from that market shift it is a tough one to answer outside of the boardroom and in retrospect, but I’d venture there is another factor which could have had something to do with it, and which could be applied to the rest of the UK’s struggling High Street.
Don’t lock your doors at the exact moment people leave their offices.
I, like many people, received a – now defunct – HMV gift card at Christmas. I never got around to spending it, largely because my local store opts to trade in office hours - ergo it’s never open when I walk past it, which I do every day. I would have happily picked up various box sets, DVDs, or tech from there were I able to.
But of course, I got what I was after from Amazon instead. Because when I turned on my computer, it was open for business.
It reminds me of a cornershop near a previous job, which often had a sign posted on a locked door saying ‘closed for lunch’. I usually ended up going to Tesco instead, which didn’t close down for an hour from 1.00pm.
When you can get things so much easier online or digitally, does the 9-5 business model for retailers really make sense anymore? It’s the one sure time wage-earners will be unable to shop, yet outside a few London stores, High Streets across the country are locked up like Fort Knox before anyone can get at them. And at weekends, you still get a lot of shops refusing to open on a Sunday.
Maybe not every High Street store is in the position to convert threats to opportunities, but when your customers can get everything so much easier from the enemy, wouldn’t making sure your doors are at least open when they walk past help?