Why (And How) We Need to Rethink Retail on the Highstreet

Research by Cushman & Wakefield using PlaceSense data reveals valuable lessons for retailers as they enter a post-Covid world and shows why they need to think creatively about attracting footfall to their city center stores. 


With the pandemic receding and states starting to lift Covid restrictions, there is cause for optimism on highstreets throughout Europe. The overall economic trend is positive, but two years of lockdowns, mask-wearing and social distancing has taken its toll on the retail sector. But just how well placed are highstreets to bounce back and adapt to the new post-covid consumer behavior? 

The ‘Are the Highstreets in Germany in Crisis?’ webinar (in German) hosted by Cushman & Wakefield and PlaceSense, analyzed the data to find out. The presentation by Helge Zahrnt and Ronny Krohn from Cushman & Wakefield, and PlaceSense’s Jan Barenhoff, featured the Retail Footfall Index, created by Cushman & Wakefield and powered by PlaceSense data. The Index tracks footfall in major German cities and compares it to the average footfall for corresponding areas before Corona. 

In general, footfall on Germany’s main highstreets, such as Mönckebergstraße in Hamburg, fell by approximately 60% during the pandemic. Despite this, when catchment areas for retail locations were analyzed before and after the pandemic (from April 2019 to February 2022), they had remained very much the same. However, cross-visitation rates, which is the number of stores a shopper visits during one journey, had decreased.

Visit trends Hamburg locations
Visit trends during Covid: Mönckebergstraße in Hamburg fell by approximately 60%.

A New Trend Emerges: Low Cross-Visitation, Targeted Shopping

Let’s use PlaceSense data to take a snapshot of Hamburg, for example, just before the pandemic. Of all the visitors to the retail district of Jungfernstieg, 63% also visited the nearby Europa Passage mall, and 72% went on to the main shopping street Mönckebergstraße. When Covid struck, however, these cross-visitation percentages dropped to 54% visiting Europa Passage and 60% going on to Mönckebergstraße. Analyzing visitor behavior, we see people going to specific individual stores in a very targeted way when they go into the city to shop.  Browsing or window shopping became less common, as shoppers looked to limit the time and number of retail outlets they visited.

Cross-visitation trends pre-Covid: Of all the visitors to the retail district of Jungfernstieg, 63% also visited the nearby Europa Passage mall, and 72% went on to the main shopping street Mönckebergstraße.

This is reflected in the lower cross-visitation numbers we are seeing since the arrival of the pandemic. People’s behavior no longer resembles the typical pre-covid shopping spree, when they would walk around highstreets and be randomly attracted into stores they pass by, maybe because of a window display or discount. This behavior most likely evolved due to Covid restrictions, where people had to stand in line before entering a store, wear a mask and produce a vaccination certificate. This has impacted cross-visitation numbers, which we can see when we look at Hamburg and other German cities today. 

Cross-visitation trends during Covid. Cross-visitation percentages dropped to 54% for Europa Passage and 60% for Mönckebergstraße.

Retailers Need To Adopt New Tactics 

That being said, retail is anything but dead. There has been a strong resilience among shoppers and their loyalty to highstreet shopping has remained. PlaceSense data shows that people are now back in city centers. People want to shop, however they have changed their shopping patterns. 

So, the foot traffic on highstreets is there, but it just needs to be optimized. This means retailers have to find ways of attracting shoppers into their stores. There are a number of retailers that can provide inspiration when it comes to embracing marketing and promotional methods. This can offer the ability to reach out to shoppers far beyond the storefront in order to promote a retail business. 

A few noteworthy examples were put forward by Ronny Krohn in the webinar, such as Kingdom of Sweets. This American-style candy retailer from the UK has two German branches, one in Cologne and one in Düsseldorf. It has in-store candy displays designed to get people to snap selfies and share online and uses aroma-diffusing technology designed to entice customers into their stores to drive foot traffic.

Merging Offline and Online 

Supreme, a street-wear label, is taking a similar, albeit different approach. The brand works very strongly to manage the availability of goods and when goods become available, it uses social and online media to drive visitors to their retail stores. This inspires the kind of fervor in customers that most brands can only fantasize about — while maintaining exclusivity and scarcity that helps convert devotion into profit. 

Blending their online presence with their highstreet locations, Shaping New Tomorrow uses a hybrid strategy that tries to optimize both. Selling ‘stretchy’ jeans infused with Lycra, it promotes and markets its products very strongly online to develop demand in their highstreet stores. They then use their highstreet locations as shipping warehouses for online sales. Shaping New Tomorrow was originally an online only brand but its success led them to open their first bricks and mortar store. They innovatively used gamification to drive shoppers to the opening by allowing customers waiting to enter the store to play games and win prizes to make the occasion both fun and memorable. 

Retailers that can adapt and change, learning the lessons of how to blend their real world and online presence, will be well positioned to attract consumers in this new post-Covid reality. PlaceSense data shows that the footfall and visitor numbers are there, it is now up to retailers to capture their share of it. 

View the full webinar in German here.

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