Why a huge telco is returning to the high street as other brands flee
While Vodafone UK announced it will axe 1,000 store fronts, fellow telco BT is defying the global trend of bricks and mortar closures with a return to British high streets - a presence not seen since 2004. It's another striking example of the real value of retail shopfronts – when done right (Marketing Week).
- BT’s return to the high street is part of a comprehensive brand renewal strategy, the retail footprint playing a well-defined role in the overall brand strategy, recognising the importance of re-building from the inside out
- Its new identity, ‘Beyond Limits’ aims to be both an outward facing communications platform and inward facing rally cry.
- Store fronts are intended to deliver a functional benefit to customers while demonstrating the brand’s relevance in contemporary culture.
- As a heritage brand, the market has a natural liking for BT - even as a telco. However 'liking' has little value if brands fail to demonstrate relevance and societal value to today's customers.
So why is a heritage telco brand, whose infrastructure underpins the digital age, returning to the high street when many retailers are fleeing bricks and mortar? Here are my theories:
1. Recognising long term purpose comes at a short-term price
The BT brand has allowed itself to become unseen by its customers, forfeiting critical brand salience. BT’s marketing strategy is underpinned by the brand establishing a new purpose, for the brand to stand for something and for that to resonate with its core customers. A significant investment will be required by BT to achieve its desired outcome and the company appears to be committed to the heavy investment required. In BT’s most recent financial statement, a very substantial sum is earmarked for this activity.
2. A challenge that hits even harder on our shores
Retail brands in Australia are facing unprecedented pressure on their business model, the compounding impact of transformational shifts in retail models, a depressed economy and limited indication of a rebound in consumer confidence on the horizon means that the temptation to behave in a way that would lead to big brands appearing diminutive could be increasingly enticing.
3. A heritage brand is not an immortal brand
Heritage brands, just as BT is to the British, play a significant role in the Australian retail landscape, however ‘heritage’ doesn’t offer immunity from the real cost of not investing in the brand. Any brand with both eyes focused squarely on the ‘sale’ needed today is at imminent risk; short termism and an over reliance on tactics correlated to achieving this, will inevitably come at a very high cost. One eye on today, the other firmly on tomorrow means investing in the brand. Ensuring the brand doesn’t diminish “being loud and proud” as BT would phrase it, requires both grit and smarts – in equal parts.
4. The power of positive friction
BT has recognised that brand purpose must be built inside-out, and the role the store front plays in that. Being where inside and out meet, done correctly, a storefront can be embraced as a true proof point of its new brand purpose. It’s a nice reminder that an endless pursuit of greater seamlessness should not come at the expense of an opportunity for positive friction.
Time will judge whether BT fulfils its ambitions; what I like about BT's strategy is a sense it understands there is a lot of hard work and authenticity required to re-earn its place as a valued brand - not just a brand with affinity due to legacy.