According to an article in the Sydney Morning Herald, foot traffic to Shops has fallen 4.4% since 2016. This is just one of the many statistics that retailers are now amassing as they attempt to understand and address retail sales decline.
Analysing masses of data is fine, we need to understand what ails us, but sometimes it pays to simplify, and here are what many commentators believe are the core issues.
1. Consumers Have Less To Spend - Rising household costs combined with stagnant wage growth means that consumers are more considered about their purchases. They simply have less to spend on discretionary goods. The spending pie is smaller.
2. Consumers Have More Choice - Consumers don't have to go shopping at physical stores, including market's, because they can purchase online, and that activity is still growing strongly. Even if they choose to tread the pavements, it is often after they have narrowed their options, particularly on price, by browsing online. The competition is larger.
3. Standing Out - If retailers are not price competitive, do not have timely ranges (particularly in fashion), and have little else to make them stand out, they will struggle. You need to stand out.
4. The Shopping Experience - much is made of creating a shopping experience for consumers but isn't that just stating the obvious. Consumers with less money, more options, and the ability to price shop in advance, are going to choose the most attractive place to shop. It might be the destination that is most convenient, or has the best food (the food offer is very important these days), or that entertains in other ways. You need to be the best.
So let's get this straight- consumers have less money, are better informed on price, and are only going to seek out the best places to spend their money. That can't be too hard to address can it?