Has the high street figured out how to stop online retailers?

The number of bricks and mortar music and video stores jumps 41% last year, but it's not good news for independent shops.

by Adam Gale
Last Updated: 01 Jul 2016

People have been worrying about the impending death of the high street throughout MT’s fifty years. Supermarkets, national chains and online retailers have all been blamed for squeezing the life out of the independent shop, yet the high street is still alive and, in the case of the physical entertainment industry (music, videos, games), apparently well.

Last year, HMV overtook Amazon as the UK’s biggest seller of CDs, and now it’s emerged that the number of physical stores selling music has increased by a whopping 41% in just a year, to 14,727.

‘These are astonishing numbers,’ said Kim Bayley, chief executive of the Entertainment Retailers Association (ERA), which conducted the research. ‘Conventional wisdom has always suggested that the internet spelled the end for physical entertainment stores, but these numbers show that traditional retail still has a place, particularly for impulse purchases and gifts. After all, you can’t gift-wrap a download or a stream.’

It does indeed follow news that the CD industry’s steep decline in the face of digital downloads may have finally begun to slow, but supporters of indy stores shouldn’t crack open the craft beer and artisanal gin just yet. The surge is entirely the result of supermarkets and multiples (such as WHSmith, Argos and Boots) muscling in on the action while independent store numbers remained static.

There are now three and a half times as many supermarkets and multiples selling physical media as there were in 2009, and they account for 96.6% of all bricks and mortar outlets between them.

Supermarkets of course have a good reason to get into music, games and videos – they too are being disrupted, and CDs aren’t affected by the vicious price deflation that’s come with the supermarket price war.  

As they have the buying power to compete with the likes of Amazon, it’s unsurprising that they’re trying to expand here. But they really compete with Amazon on convenience (you’re already there for your food), not range or price. The destination for physical music purchases is still online and that’s very unlikely to change.

In various sectors, a multichannel equilibrium seems to be forming, where both digital and bricks and mortar chains have a place (indeed, Amazon’s decision to build physical stores is a clear indication of this phenomenon in the book sector). But none of that’s much help to the plucky independent shop squeezed between the two behemoths. The high street may well survive, but there’s no stopping disruption.  

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