Severe cracks are showing in the High Street. Border’s is gone, JJB, HMV and Clinton Cards are all under threat and Jane Norman is entering administration. Consequently Habitat’s recent announcement shouldn’t come as too much of a surprise. Consumer confidence on the high street is still low, many retailers borrowed heavily during the boom times and are now struggling, especially with the rising prices of raw materials and the internet is finally proving to be a truly formidable foe. Habitat in particular is suffering with fewer people moving house and putting off redecorating for a later date.
The Independent asked ‘Why did we fall out of love with Habitat? Was it them or us?’ But the question is redundant, both had an equal part to play - consumer habits changed and the retail brand failed to keep up.
The high street is tough and overcrowded, natural selection dictates that only the fittest will survive, but this doesn’t mean that Habitat was doomed from the off. We thought we’d have a look at where Habitat went wrong and what other retail brands can learn to avoid the same fate.
Founded at a time when chintz and willow china were de rigueur, Habitat, brought good design to the masses and revolutionised British taste in interiors. But recently it has been struggling, operating at a loss for the last three years and over £88 million in debt. Where did it all go wrong?
Out with the new in with the old
There has been a shift in the popular design aesthetic. In its heyday Habitat was the harbinger of modernism, baby boomers wanted to break free from their parent’s stuffy style and embrace something much more futuristic. But this forward-looking aesthetic has come to seem somewhat naff in the 2010s, relegated to the interior of the now defunct Big Brother house. When it comes to interiors minimalism has replaced futurism, and nostalgia has taken the place of optimism. Consumers prefer to decorate their houses with catchphrases from World War II (increasingly ubiquitous), not Habitat’s ‘sag bags’.
Habitat’s exaggerated emphasis on the new meant it lost out, while retailers like John Lewis experienced an 8.6% rise in sales last year.
Failure to lead from the front
Another contributing factor to Habitat’s demise was its failure to find an enigmatic designer to lead the brand. Under Conran in the 60’s and 70’s and Tom Dixon in the early 2000s, the retailer flourished, but apart from a few token collaborations with celebrities, which felt more like something DFS would do, they failed to really capture the imagination of consumers.
Outwitted by the competition
Ikea entered the UK market in the 80’s and matched the design aesthetic that Habitat had been so well known for. But Ikea didn’t stop there. They easily beat Habitat on price and actually delivered on the British store’s original promise to bring design (although not quality) to the masses. Ikea offered utilitarian storage and a Scandanavian design ethos that Habitat just couldn’t match. For the last few years Habitat has sat in no man’s land. Unable to compete with Ikea on price or functionality, yet unable to match the more high end retailers like Heal’s, the heart and soul of Habitat went missin and they lost their reason to be.
Failed to leverage the in store experience
Interiors retailers have flooded the internet. You can get everything from handmade pieces at affordable prices to cheap furniture delivered fast. To compete Ikea and Heal’s have launched their own online stores but they still capitalise on the in store experience and each offers something that you can’t get online. Ikea guarantees the same experience no matter where you are and Heal’s holds the promise to surprise you every time, both are compelling reasons to actually make the trip to the store, reasons that Habitat failed to articulate and therefore lost footfall.
The future of Habitat is uncertain. Creating concessions in Homebase may now be the only viable solution for the business. But it’s a sad reality for the brand. A retail icon becomes another piece of tat in a general home store. How the mighty have fallen. For more ideas on the future of retail click here.