Bricks 0, Clicks 1

Choices UK is finally going into administration. It's had terrible results for the last few years - in fact it's been downhill all the way since 2004 for the share price.

Now we're left with almost no music/entertainment chains on the high street. A number of other chains have gone, as well, and DVD rental stores are closing down everywhere.

While media sales are up, people are choosing to buy them through alternative channels. Mail order, mainly through online stores, has taken over the market, and with a number of ISPs now starting to offer online downloads, the high street has lost its raison d'etre.

Besides, the new business model offers a white label opportunity. LoveFilm, the leader, also supplies services to the Guardian, Tesco and WH Smith - reducing its marketing cost while vastly increasing its addressable market. Next to this, buying a shop and advertising the retail brand is a needlessly wasteful business model.

So it's hardly surprising Choices UK has found the going tough. The question that really needs asking, though, is why Choices couldn't see the writing on the wall - and get into the growth areas.

It seems to have defined itself as a high street retailer first, and a media channel second. Which meant that the internet, for Choices UK, was always a secondary concern - instead of the vital strategic option it should have been.

Entertainment obviously has a particular vulnerability since the product can be digitised. But I wonder whether we will see online sales really putting the squeeze on the high street - particularly if consumer spending slows further - in other product areas too.

LoveFilm / whitelabel