Our high streets are filled with long-established, powerhouse brands that thought they’d be around forever.
BHS, Toys R Us, Dixons, Phones 4 U, Comet, Maplin and Poundworld all know better. Even Marks & Spencer is shutting stores. This month the BBC published figures suggesting 20,000 retail jobs had gone in the UK this year, with another 20,000 at high risk.
Retail is a very different sector to HE, selling products that involve different relationships with customers. Online offerings were always going to be hugely disruptive, offering lower prices, wider choice, easier access. But there are also plenty of similarities to HE that provide warnings to the sector about how quickly traditional models can be undermined. As recently as twenty years ago no one would seriously have believed that high street retailers would not just be struggling but look obsolete.
Adapt to survive
The biggest issue is attitude. Many of the brands mentioned above would previously have been considered too big to fail. In the new context of disruptive digital technologies, past glory is no indication of future success. Universities need to ensure their strategic planning isn’t rooted in assumptions about the ongoing strength of their brand, of being indispensable to the market.
Then there’s physical presence and scale. The reason such large retail businesses failed is that they were hard-wired into operating from networks of high-cost bricks and mortar premises – a commitment to capital costs, maintenance and staffing that has meant inflexibility and lack of agility when it came to introducing change. Constant high volumes of trading in stores was always essential. Any fall off has a magnified effect on operations, just the same way fewer undergraduate and overseas students is having. Property ownership and investment by HE is huge – and accelerating since tuition fees and the need for campus ‘beauty contests’ – meaning a similar burden to retailers when it comes to responding to new competition.
And it’s coming. More new entrants with creative niche offerings focused directly on equipping students for work, plugged into employer needs, will be hoovering up larger numbers of students away from traditional institutions. HE’s Amazon could well be institutions like Arden, Holt, BPP. We have already seen new private providers with TEF gold outshining members of the Russell Group. There’s potential for new enterprises and partnerships to strip away the unnecessary, or what’s perceived to be unnecessary, in the same way online shopping has done. Less time and money required.
New model learning
It’s all a matter of mode of delivery. We haven’t stopped shopping, we still want as many new clothes, gadgets and toys as ever. Similarly, the importance of a degree to enhance life chances is still real. There will always be students wanting an education but the definition of an education and its price will not be decided by the sector but consumer.
Are universities being quick enough and creative enough in delivering programmes in ways that appeal to and are practical to 21st-century students? There may well not be an immediate rush to online, distance and mobile learning, but might involve ensuring students feel they’re getting more personal attention. But there needs to be more flexibility and different packages of delivery.
Online retailers have been very successful in building new kinds of relationships with shoppers. The paramount importance of numbers in HE has meant a shift to a focus on sales (the drive to recruit) when the focus really needs to be on more sophisticated marketing (in establishing differentiation, a strong identity and character, a clear picture of where the added value is in going to this and not another university, what the learning opportunity is).
Digital technology started out by transforming how goods and services could be sold and delivered. More than this, it’s now gone on to transform people’s attitudes to who they’re willing to shop with. Small enterprises can quickly build customer reach and loyalty via social media, for example.
In the same way, there’s no reason why small start-ups and networks of partners couldn’t get a reputation for providing degrees and other forms of development and assessment that employers respect and see the value of – that are also cheaper, more fun, offer a richer experience and take less time.