Clem Sunter

Two real game-changing flags

2013-01-10 14:27

Clem Sunter

Foxes always have one eye cocked on changes taking place in the business environment - and, boy, did a big flag rise the other day on a major change which is turning the retail sector upside down.

John Lewis, a major UK retail chain, announced that online Christmas sales in 2012 were 44% higher than the previous year. Now I know that online sales are still a relatively small proportion of overall retail turnover in most countries, but this result was sensational when Christmas sales for the whole of the UK were almost flat. Significantly, most major brand retail groups in the UK recorded online sales growth in double figures though I haven't heard of any others that rivalled John Lewis.

Here, in South Africa, I haven't seen any Christmas figures but I bet you we are experiencing the same phenomenon because we have the same reasons for converting to online shopping:

- it is more convenient for you as a customer and saves time;

- it is more cost-effective because you don't have to drive or take public transport to the shop and then pay for expensive parking; and

 - the actual price of the product you are purchasing online may well be cheaper than the identical product in a physical shop as the vendor is basically selling to you wholesale and is saving on the normal rental for retail space.

The only offset for the company selling you the product is that it pays the cost of delivering it to you. However, most online sellers (including online book marketers) have developed slick distribution systems. Yes, there are exceptions where people have had to wait an inordinate amount of time for delivery but as the online retail industry grows up, the problems will be ironed out.

Of course, retail foxes are already adapting to the new reality and John Lewis is leading the pack. In Australia, I went into a men's outfitters in Perth to check out some suits. The assistant sauntered over and said it would cost me 25 Australian dollars to try one on (that is R225). I said "you're kidding", and he replied: "I'm not. Most customers come in and try my suits on and buy the exact replica on the internet where you don't pay GST. So we've turned ourselves into a trying-on shop!"

The second game-changing flag fluttering in the wind came out of a conversation I had at a lunch in Somerset West. One of the guests who works as a reporter at a Cape newspaper described the significant cutbacks that have been made in the number of staff in newsrooms around the country. It means less specialisation and fewer reporters covering a greater variety of topics. Forensic investigation is almost becoming a thing of the past.

Online media sites like the one I'm writing on are playing havoc with the business models of the printed media since you can get your news for free on the internet. Moreover, you can comment on it as a reader immediately which you cannot do in a broadsheet or tabloid. Virtually every newspaper in the world is therefore putting as much effort into its online website as it is into the paper itself. Yet, the majority of them are still offering content for free on the internet. Hence, the pressure on newspaper staff complements caused by pressure on profit margins.

Retail property developers and newspaper proprietors have to be really foxy in coping with the two flags I have described. Basically they have to reinvent their product, the former by turning their malls into an entertainment space (for example you cannot eat at an online restaurant) and the latter by offering more sophisticated commentary and analysis on the news rather than just breaking the news itself. My advice to both of them: stay bright-eyed and bushy-tailed as the High Street will never be the same again.


Send your comments to Clem

Disclaimer: News24 encourages freedom of speech and the expression of diverse views. The views of columnists published on News24 are therefore their own and do not necessarily represent the views of News24.


- News24

NEXT ON NEWS24X

The testimony that sunk him

2014-04-18 07:00

Read News24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
9 comments
Add your comment
Comment 0 characters remaining
 

Inside News24

 
 
Traffic
Lottery
 
  • Thursday Sir Lowry's Pass - 05:35 AM
    Road name: Old Sir Lowrys Pass Road
    TRAFFIC LIGHTS not working at Bezweni Road
  • Thursday Cape Town - 05:35 AM
    Road name: Buitengracht Street
    TRAFFIC LIGHTS not working at Waterkant Street
 
More traffic reports...
 

Jobs in Cape Town [change area]

Property [change area]

Travel - Look, Book, Go!

Escape winter, head to Mauritius

Escape winter by spending 7 nights in Mauritius' tropical bliss from R13 215 per person sharing. Includes return flights, airport transfers and accommodation. Book now!

Kalahari.com - shop online today

Get many eggs in one basket!

Gaming bundles: 2 Super Hits games for R99, 3 Disney games for R99 and more + exclusive accessory bundles only available on kalahari.com. While stocks last. Shop now!

25% off bestselling books!

The Real Meal Revolution by Tim Noakes, Jeffrey Archer’s Be Careful What You Wish for, Man’s Search for Meaning by Victor E. Frank and many more titles. Shop now!

Up to 25% off electronics

Buy top electronics and save up to 25%. Such as kalahari.com’s 1# selling product the gobii eReader, Patriot X Porter flash drive, Asus Nexus 7” 3G tablet, Samsung Galaxy SIII, Lenovo G580 Notebook and many more. Shop now!

DStv HD PVR Decoder now R949

The DStv HD PVR Decoder has further revolutionised the television experience with lifelike viewing, sharper images, more vibrant colours and precision picture quality. Now R949, save R550. Offer valid while stocks last. Shop now!

Up to 30% off appliances & homeware

Save up to 30% on appliances and homeware this Easter! Offer valid while stocks last. Shop now.

OLX Free Classifieds [change area]

Samsung Galaxy s4

Mobile, Cell Phones in South Africa, Western Cape, Cape Town. Date October 24

Best bargain in big bay

Real Estate, Houses - Apartments for Sale in South Africa, Western Cape, Cape Town. Date October 25

VW Golf 6, 1.6 Trendline (Excellent condition)

Vehicles, Cars in South Africa, Western Cape, Cape Town. Date October 25

Nokia N9

The Nokia N9 has a beautiful one-piece, unibody design where...

From R2899.85

I'm shopping for:

Horoscopes
Aquarius
Aquarius

You may be good at organising events but they do take their toll on your energy levels. You may need some time out today just to...read more

There are new stories on the homepage. Click here to see them.
 
English
Afrikaans
isiZulu

Hello 

Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.


Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire 24.com network.

Settings

Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.








Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.