British Land has made a statement recently, to coincide with the announcement of its yearly results, that acknowledges that retailers, and therefore landlords, must adapt to the rise of digital shopping or become obsolete.
The company owns and manages over £16.4 billion of UK properties making it one of the largest listed managers of property in Europe with a portfolio focused primarily on high quality UK retail locations. It sees that stores will remain central to UK retail in a world increasingly dominated by online shopping, but warns that physical and digital shopping must be integrated, with stores becoming showrooms, as well as pick-up and return points.
Reporting a fall in full-year profits, British Land said its UK retail business had been hit by the “twin challenges” of lower consumer spending and the growth of online sales and that it was now key for both retailers and landlords to adapt to the changing way that people shop: rational (purpose-led) and emotional (experience-led). We all know that the internet lies at the heart of these changes, not only because of the immediacy of being able to buy online, but also because of the way it enables consumers to compare prices and quality, share their opinions and shape the development of new products and services. The line between online and physical sales is getting increasingly blurred with the majority of sales more likely to have some sort of digital aspect.
From now on British Land will be expanding its digital platform and exploiting technological innovations for the benefit of both retailer tenants and consumers. The company cites a recently-struck long-term partnership with BT to introduce free Wi-Fi to all its shopping centres and extend Wi-Fi across retail parks as a first step. It’s good to see that enlightened landlords are coming to accept that it is vitally important to have the right assets, the right approach and an ability to adapt to a fast-changing retail environment and all the challenges that it brings.
