Evidences of Global trends for decreases in footfall and increases in void retail properties in town and city centres and causal relationship
Over the past ten years there has been a sea change to city and town centres across the world. The impact of out of town shopping, particularly on middle-order district and local town centres has been ‘strongly competitive’ rather than ‘benignly complementary’ (Thomas, et al., (2004))and latterly the rise of online shopping has taken their toll on many high streets including reducing footfall and increasing vacancy rates through competitive pressures (Weltevreden, 2007)
The changes in market share of traditional retailing in town and city centres has mainly considered vis-à-vis their supply side effects for example, the level to which online shopping and out of town has replaced elements of use of traditional town centres across Europe and the world (Weltevreden, 2007) (Weltevreden, et al., 2014). In the UK between 2008 and May 2018, 409 large and medium sized retailers have gone into administration affecting 28,378 retail stores and 280,425 employees (Bamfield, 2018).
Other reasons that have been identified as contributing to the downturn in bricks and mortar retailers include drops in demand for consumer goods, in part driven by the sluggish economic growth since the financial crisis, intensive price competition and a developing trend for a smaller proportion of household income to be spent on retail, supplanted by spend on holidays and travel, eating and drinking out, experiences and weddings – all of which are growing faster than spend on retail (Bamfield, 2018). This downward trend in spending on comparison goods seems to be replicated in the USA. According to retail consultant Howard Davidowitz, numerous USA midmarket malls, are suffering from this drop in spend (The Manchester Guardian, 2014). Whilst out of town shopping and the rise of internet shopping may not be the only causes, the literature suggest that they are certainly significant contributory factors (Astbury, 2014) (Weltevreden, et al., 2014). It is worth noting though that although there have been significant swings towards online shopping the research evidences that still the vast majority of retail is taking place within a physical retail environment with eMarketer estimating that globally retail ecommerce sales will increase to $4.058 trillion in 2020, making up 14.6% of total retail spending (Chaffey, 2018). and that some retailers are already indicating that future models of retail will likely still benefit from retaining physical “bricks and mortar locations” often on the historical high streets (Retail Customer Experience, 2018)(Grimsey, 2018) Certainly “service” retail which is co-produced with the consumer benefits greatly from having a physical presence on the high street there are however some disadvantages to this high street presence, not least of which in the UK is the disparity in taxation – according to Centre for Cities Research business rates are the equivalent of 2.3% of bricks-and-mortar retailers’ sales and 0.6% of online traders’ sales and prevent shops competing effectively with their online rivals. (Bamfield, 2018)
International trends have shown an increase in empty retail units and a decrease in footfall in many towns and cities (Weltevreden, et al., 2014). It is expected globally that these trends will continue (Ellis-Chadwick, 2018). In the UK as a whole, Store vacancies have been running at around 11.9% for some time, although there was a rise to a vacancy rate of 14.3% in 2011 (Bamfield, 2018). As of February 2019 UK vacancy rates are running at 11.5% (Local Data Company, n.d.). It is widely reported that negative changes to a place including high retail vacancy rates and the loss of key industries or trends in mobility and tourism, can profoundly undermine the reputation of a place (Millington & Ntounis, 2017) which in turn can lead to a deleterious cycle of footfall declines, spend declines, poorly trading/failed businesses, town/city centres becoming less attractive due to higher vacancy rates which again leads to lower footfall and so-on. This is not necessarily demonstrated in all areas, and local effects can influence this (Grimsey, 2018)
Local Impact on Gloucester UK
For the purpose of the this analysis we will be looking in detail as to the impact of these global changes on the city centre of Gloucester, UK a small city with a population of 129,000 and with a hinterland of 150,000 (Office for National Statistics , 2017)
Vacancy Rates and Footfall
As of January 2019, Gloucester has been similarly impacted by the difficulties faced by the high street. We will be investigating through this report how local initiatives appear to have affected the area, analysing the statistics for footfall and vacant retail properties to note differences from national and global changes and investigate any probable causes for those differences in Gloucester.
In Gloucester over the last ten years the global effects of the changes have been mitigated at times for example in 2010 the city was reported to have among the highest number of empty shops in England, according to a study commissioned by the BBC’s Inside Out West programme from the Local Data Company .(BBC, 2010) with retail vacancies at nearly 21.9% in 2010 however these fell to 12.1% in 2016 but rose by December 2019 to 19.3%. (Local Data Company, n.d.). Note that these figures relate to the historic city centre and that current figures for vacancies including Glouecster Quays bring the current vacancy rate to 12.8%
Source (Local Data Company, n.d.)
Source Marketing Gloucester
• Impact on perceptions of place
In Gloucester surveys of local visitors reports in local press (Phillips, 2018) indicate a negative impact on perception of the areas of the city with higher retail vacancies c.f. areas that have been regenerated and perceived to have a lower number of retail vacancies (My Local Economy, 2017)
• Political impact
The concern expressed by businesses and residents in Gloucester has led to a focus by local politicians on physical and culture regeneration with the aim of redeveloping the city and repositioning from a comparison shopping centre to a destination for residents and visitors (Council, 2019).The poor perception of place has been seen as being a potential negative by the political incumbents (Conservative) and conversely positive news in terms of footfall and vacancy rates along with regeneration activity has been seen as a benchmark of political success (Gloucester Conservatives, 2016)
Specific Local issues
In Gloucester as with many UK cities there has been a closing of branches of a number of high street chains which it might be concluded ad naturam would impact footfall. The local picture, evidences that the model is more complicated than it might initially appear for example the percentages of empty stores was skewed with 54 new retail and leisure units being built at the new Gloucester Quays designer outlet during 2009. Many of these units remained unoccupied after the outlet centre was opened and were then filled over subsequent years. As of 2019 there are 641 retail and leisure units (Local Data Company, n.d.) within the city centre of Gloucester as defined earlier in this document, including those at Gloucester Quays – it is evident how the occupancy of these additional units would affect reported percentage levels of vacancy. These additional units at Gloucester Quays were mostly filled by 2015. A further complication has been added to the analysis of 2017 onwards as alongside the impact of national chains closing, there has been a hold back on releasing some of the empty units which have been bought by Gloucester City Council as art of its strategy of land acquisition and consolidation to enable an planned regeneration of a quarter of the city
It can be concluded that Gloucester is subject to the same Global trends regarding footfall and vacancy rates. One element that needs to be taken into consideration in Gloucester is the significant emphasis that has been placed on the visitor economy and events as drivers for footfall, Events such as Gloucester Goes Retro 25th August 2018 increased footfall by 40,000 and in one of the busier retail areas increased footfall for the week by 20% (Local Data Company, n.d.)
The strategic responses to date and planned and evaluation of the efficacy of historical initiatives and examination of current and future planned responses c.f. best practice
Historic strategic responses
As indicated by the literature it has been common practice by cities which have suffered decline to develop strategies to overcome negative stereotypes and change the image of a place into one attractive to investors, property speculators and visitors (Millington & Ntounis, 2017) . The importance of “place marketing” in post‐industrial towns is well documented (Kotler, et al., 1999) and the role of events within a place marketing strategy has been recognised (Wood, n.d.)
Following a high impact flood in 2007 and the subsequent world-wide economic crises the leader and cabinet of Gloucester City Council formed Marketing Gloucester Ltd (Marketing Gloucester Ltd, n.d.) a new public private partnership with a wide remit to engage in place making activities and especially focussed on Place Marketing (Parker, 2011) recognising that to reverse long-term structural decline an holistic place management approach would need to be implemented which following identified best practice widely engaged stakeholders (Brand, 2007). This multifaceted coordinated approach is one that is widely recognised model (Switzer, 2009) (Vanalo, 2008). Also much emphasis is made in the literature that developing the multi-layered “product” of place is a prerequisite for the implementation of an interconnected and credible place-branding strategy (Ntounis & Kavaratzis, 2017)
Strategic initiatives to drive growth through developing the visitor economy through branding, events and promotion
In 2014 a wide reaching strategy was produced by Marketing Gloucester and adopted by Gloucester City Council entitled “Growing Gloucester’s Visitor Economy” (Jason Smith, 2014). This aimed to identify the barriers to growth and set out key actionable strategies and identified 20 areas that could be worked on in order to develop the place product and place branding and marketing, there were 54 actions that were highlighted that could help deliver growth (Jason Smith, 2014, pp. 24-31).
One element of this strategy was to develop the concept of experiential branding through events that would build on the history and heritage of the city and would provide ample opportunities for place marketing to promote the brand positioning (Vanalo, 2008) (Lodder, 2010)
Figures 5, 6
Statistics (figures 5,6) indicate that there has been an upturn in visitors to Gloucester due to this strategy
Building on strategic responses for future growth
There is evidence that best success in place repositioning is based a multistrand, holistic approach which builds a strategy based on “clear or shared” understanding of the identity of a place (Millington & Ntounis, 2017). For those involved in place branding and place marketing this includes two significant elements, firstly the positive portrayal of a place focussing on “the good bits” to attract inward investment, influence the political influencers and encourage visitors and topophilia, secondly the controlling, containment or ignoring of “the bad bits” (Hankinson, 2003) .
Using Events and Place Marketing to develop brand and drive footfall
It has been demonstrated by the direct impact on footfall of events marketing (Wood & Masterman, 2007)and the positive effects on place branding (Wood & Masterman, 2007) that events and place marketing have been significantly successful in having an impact on the growth of the local economy in Gloucester and drivers for footfall. Much of this success has been due to the successful implementation of a focussed place branding exercise and place marketing by Gloucester’s place making organisation Marketing Gloucester (My Local Economy, 2017) (Creative Tourist Consults, 2016) this approach has been successful by the treating of place as an assemblage where contributory elements are used to develop a nuclear product (Hankinson, 2003). This strategy responds to a number of the most important factors identified as affecting vitality and viability of town and city centre’s (Cathy Parker, 2014) such as improving visitor experience, providing entertainment and leisure activities, improving attractiveness through city dressing for events and giving a “hook” to hang place branding and marketing, which is recognised as being an important use of events (Pugh & Wood, 2004). Key to this strategy will be looking at historical anniversaries and connections to significant events as they relate specifically to Gloucester.
Although there should be a multistrand approach to the global challenges faced by Gloucester of falling footfall and increased vacancy rates (Grimsey, 2018) many of these are not quick fixes and require significant capital investment (Gov.UK Ministry of Housing, Communities & Local Government, 2018)
Resources necessary to implement this response
The building blocks of place branding process have been described as being analysis, strategy and participation (Ntounis & Kavaratzis, 2017)
As demonstrated earlier in this document evidence of trends in footfall and vacancy rates, along with tourism visitor numbers which are collated from footfall counters, vacancy rate counts, Acorn T-Stats, Visit England and so-on are important to informing strategic responses. It will be important to ensure that the collation of these datasets and analysis (Ntounis & Kavaratzis, 2017) is consistent and adequately resourced.
Effective leadership is identified as essential to effective place branding (Hankinson, 2003) and as discussed previously wide stakeholder buy-in and support can increase effectiveness of activities (Brand, 2007). In the city of Gloucester this leadership is provided on behalf of stakeholders by bodies including the BID, Gloucester City Council, Gloucester Civic Trust, Glouceste Heritage Forum, Gloucester Culture Trust, Gloucester Chamber of Commerce and Marketing Gloucester. The strategy for Place branding, Place Marketing and city events are coordinated and lead on by Marketing Gloucester as mandate by contract with the City Council and Gloucester BID and by formal and informal arrangement with other bodies. Each of these bodies is mandated by statutory status or by their stakeholders. This continued support from stakeholders will be an essential resource to the success of developing and implementing the strategic response of utilising events and especially heritage themed events as a focus for place branding and place marketing. Bodies such as Marketing Gloucester which provide leadership need to be adequately funded to ensure success.
The place product is managed by a complex organisation of public and private sector stakeholders (Hankinson, 2004) making it difﬁcult to present a consistent brand proposition. Place branding therefore inevitably becomes a coordinated process rather than a managed activity (Hankinson, 2003). Furthermore, the role of coordinator usually falls to local authorities, which operate on low budgets and are subject to political control and interference which further exacerbates the task of brand management. (Hankinson, 2003) In the need to resource this activity has been recognised and has been given to the public private partnership organisation Marketing Gloucester. These type of “Urban Partnerships” are often held up to be good models for stakeholder engagement (Le Feuvre, et al., 2016)
It is important looking forward to continue to review the type of urban partnership that best suits the aims of developing and delivering the strategic responses outlined in the place specific context ensuring avoidance of the “transient tranquilizer of avoidance” or the “high-stakes politics of absolute conquest” relationships between stakeholders, ensuring the main focus of stakeholders is knowledge exchange and collaborative working to give the best opportunity to maximize the chances for success from effective partnership working (Brand, 2007)
It has been recognised in the literature that successful shared intelligence amongst stakeholders engaged in place management can “help inform the identification of new strategic objectives, appropriate interventions and project planning and delivery” (Millington & Ntounis, 2017) Ensuring that there are fora to facilitate stakeholder informing and shaping strategy and helping to implement strategy will be key to the success of the proposed place branding strategic response. These same stakeholders will be needed to provide organisational, leadership and financial resource.
Key to successful place branding and place marketing is ensuring that there is sufficient funding to implement strategies. Marketing Gloucester has developed a rolling 5 year business plan which identifies that a successful implementation of the above strategy including the elements provided on behalf of Gloucester BID will require direct funding for place branding activities, including events and place marketing of approximately £900,000 per annum plus resource for the funding required from partners or leveraged funding for other place making activities.
In April 2018 to March 2019 funding of £1.1 million for Events and Marketing in Gloucester which are aimed to develop place branding, drive footfall in Gloucester came from – Gloucester City Council , Gloucester Business Improvement District (BID), private sector sponsorship, and funding from other bodies such as Visit Britain, Arts Council England, Heritage lottery Fund GFirst LEP and the Heritage Lottery Fund. It is envisioned that the ongoing strategy which has been attractive to these funders will continue and built upon with ongoing funding support .
BIDs are becoming increasingly important in the funding and steering of place marketing including events (Morcol, 2008). In Gloucester there is a close symbiotic relationship between the BID and the Destination Management Organisation which is run by Marketing Gloucester. Nearly £2.5 million over 5 years has been committed by nearly 600 businesses to place management, place marketing and events. Currently Gloucester City Council commits £249,000 per annum to supporting Marketing Gloucester, £160,000 of which is spent on events (Gloucester City Council, 2018). In 2019/20 sponsorship and commercial income is expected to reach just under £0.5million.
Currently consideration is being given to Gloucester applying for 2025 UK City of Culture status we would expect the cost to prepare these bids to require and additional £150,000 to £200,000 of direct funding (BirminghamLive, 2010). There is yet to be produced compelling evidence that UK City of Culture has a comparable return on investment compared with other initiatives.
It is the development of the place product through events, often utilising key heritage physical assets, that is the key factor in the proposed strategy enabling the development of place branding and place marketing activities to drive footfall and help decrease vacancy rates.
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