What will happen to the high street?

This article is part of our new editorial package, The Future of Shopping, in which we predict how the retail landscape will be shaped over the next decade. Click here to read more. It’s an age-old question with a 2024 twist. What will happen to the high street? Decades of decline, sharply accelerated by the pandemic, have turned many UK town centres into shells of their former selves. For years, stakeholders have been advocating for the need to make the high street less about selling things and more about the experience and fostering a sense of community. As that shift gradually takes place, it’s still unclear where some retailers fit in. For some — like British fashion chain Ted Baker, which has 46 stores and collapsed into administration last month — time is running out. We spoke to a range of high street stakeholders and advocates about why high streets are struggling and what the future holds. Among them are disruptors such as Positive Retail, a resale concept set up in 2020 by former Topshop buyer Anna Woods, which now has three stores and an online business. Its strapline is “Curation. Community. Change.” And Modes, an Italian luxury multi-brand retailer that is gearing up to open its first store in the UK later this year. Outernet, meanwhile, is an immersive leisure district in central London that aims to create a new kind of high street, one that is highly curated and rooted in entertainment and experience. The main takeaways? On the high street of the future, retailers will have smaller footprints that work much harder; human connection will be recentered; and, above all, curation is key. E-commerce has not killed the high street — in fact, it could be the very thing that liberates it. Anna Woods, founder of Positive Retail The high street has been ravaged by greed, constant discounting, Black Friday, lack of decent leadership and a race to the bottom. Total overconsumption and overproduction. When I started [as an assistant buyer] at Topshop 20 years ago, our target on European shoes was to make a 56 per cent margin and 70 per cent full-price sell-through. When I stopped working [for fashion retailers] three years ago, my target margin was 80 per cent with 15 per cent full-price sell-through. Stores are planning for discounts. They are trapped. Why does a garment come in at full price in January and then by June it’s worth a fraction of that to the customer and to the business, all to clear through it and pile more on top? Nothing is created to actual demand or to sell out at full price. Positive Retail (the resale concept Woods set up in 2020, which mixes surplus stock with private seller consignment) has proven that, given an elevated environment and careful curation, surplus can hold its value. People need human connection. People want to shop in person. Especially with resale, they want to try it on. People also want to chat: they want a therapy room, a routine and a thriving place to live that they can be proud of. Resale and interesting experiences that make people feel again will be key to the high street’s future success. My stores make people buzz, because they feel like we care about them and curate for them. This can be scaled, and we plan to. Ibrahim Ibrahim, managing director at Portland Design and author of Future-Ready Retail One of the main reasons for the failure of many shopping centres and high streets is boredom with the cookie-cutter experience. If you’re not going to offer anything other than a product on a shelf and a transaction, why would your customer go into the shop rather than order online? That’s the reason I believe the internet will not kill shops — it will liberate them. That liberation is about how we reimagine and rethink physical spaces. High streets will move away from being about transactions to being about community. The changes and disruption we’re seeing are cultural shifts. Unless we understand where those cultural shifts are coming from, we’ll never understand what the future holds for the high street. A trend we’re seeing already will continue: brands will have less and less shops, preferring instead to focus on a few, localised flagships. Many will migrate their transaction and fulfilment processes online — again, this is happening already — and use their physical spaces much more for recruitment and retention of customers. This will be about the brand story: experience, learning, sociability, and most importantly, community. If people are buying into what the brand stands for, it creates an emotional connection. That value is well beyond the size of the shop, or the amount of goods it sells. Simon Whitehouse, CEO of Modes Modes is a historical Italian multi-brand retailer from Trapani in Sicily. Over the years it has opened boutiques in locations like Portofino, Porto Cervo, St Moritz, as well as Milan and Paris. We have two key pillars: the destinations and the people. It’s not transactional. The client advisors are artists, stylists, musicians, models — they’re part of the community. [Founder] Aldo [Carpinteri] anticipated a lot of what’s happening to e-commerce now and scaled back the online business to really focus on curated retail. E-commerce is so cold and transactional. We still want a human being to connect to and share emotions with. That personal element is really important. We’re reconfiguring online at the moment to be more of a window. It will offer content and exclusive product and collaborations, and be about the community, so that you can really step into and understand the Modes world. Purpose-driven brands will be very important going forwards because you can’t compete on price. You can’t compete on the ‘what’ because most of it’s been done before. So this question of ‘why’ people are buying is very, very important for the future of shopping. Why somebody would want to buy a particular product, how would that make them feel, and what kind of affiliation and association as part of that community they want to buy into. Fiona Harkin, foresight director at The Future Laboratory Retailers need to ensure their stores are hyperphysical — that is, destinations to entice consumers with meaningful spaces and experiential services that elevate the traditional experience of being in a store. In order to thrive, high street brands need to take a local flagship approach where the store is less about selling products and more about providing consumers with enriching, emotional, ethereal and exclusive experiences. We call these the ‘Four Es of Retail’ and, in the near future, retailers can use them to craft enveloping, exciting and engaging moments that build meaning and sentiment with shoppers. The high street will be transformed in coming years into a more personalised in-store experience, driven by technological advancements, evolving consumer preferences and a more entertainment-driven dynamic. In the era of hyper-personalisation, retailers aiming to maintain market share must cater to customers who expect tailored experiences and personalised interactions. However, meeting these expectations is becoming increasingly challenging due to stricter privacy regulations. First-party data has become valuable currency, and retailers need to leverage this data ethically and responsibly to meet customer expectations for personalisation and to redefine the retail experience. As consumers rely more on social media to influence their purchasing decisions, various platforms provide personalised content recommendations based on consumer data and trends. And high street retail brands have the agility and scale to leverage this first-party data to inform future offers based on customers and community preferences. Joshua Bamfield, director at Centre for Retail Research Everybody says I’m an alarmist. But when you see what’s been happening [to high streets] over the last 12 months, I think alarm is probably the right reaction. Retail is important: it’s a reason why people go and visit town centres. If high streets are completely eliminated because of online shopping, I think there will be a reduction in joy and happiness. What’s helped most high streets to survive is the shift towards services like hairdressing, wellness, health. And there’s been this shift towards experiences: escape rooms, climbing, play areas for children. I’ve heard many debates about the way in which museums and art galleries can be used to make the high street more interesting. But on its own, it’s not going to be enough. And, of course, the fact that people’s spending power is so constrained is a real problem. Retail sales volume is 1.3 per cent lower in 2023 than it was in 2019. The whole retail cake is smaller overall. Philip O’Ferrall, CEO of Outernet Curated high streets full of smaller brands are the recipe for success. All roads lead back to this point around curation, whether it’s one type of retailer — for example, on Denmark Street [in London], most of the shops are related in some way to music — or, on local high streets, a mix of smaller brands that are passionate about what they do and the local area. The question is, how do you support these types of businesses? Smaller brands need support from the landlords, as well as relief from the costs involved in operating a shop. If you take the same mindset as the television, radio or social media industries, the main focus should always be on understanding your audience. Then, you curate the programming around them. Retail should be the same; you should enjoy that interaction. Whether it’s a high street or a district — or in our case, a mini high street, a district and an entertainment business rolled into one — everything must be focused on the audience spending more time with you. Very often, you go into a retailer, and the staff are either too pushy or not pushy enough. The first job should be to make people feel happy, comfortable and safe. Paul Swinney, director of policy and research at Centre for Cities A big factor in whether a high street does well or not comes down to the number of jobs in the city centre. More jobs mean more people coming in every day. More people coming in every day means more money walking past the door every day. And if the money is there, then half the battle has been won — now entrepreneurs just have to work out what people want to spend it on. That is increasingly becoming cafés, bars and restaurants. Our most successful high streets have many more of these than the less successful ones. This tells us that so long as people have money in their pockets and want to have in-person experiences, there will continue to be a role for the high street. The job of retailers is to continue to adapt as what people want to spend their money on changes. Comments, questions or feedback? Email us at feedback@voguebusiness.com. More from The Future of Shopping: What really happened with Matches and where do we go from here? How Gen Z’s shopping habits will shape the future of retail The Vogue Business guide to TikTok Shop

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