Why the future of the high street is all about "experiences"

The rise of online shopping has hit brands hard. But it could be just the thing to end the homogeneity of the British high street—and offer customers something new

May 30, 2018
A Lush shop, where customer experience is key. Photo: Flickr/Oscar Hanzely
A Lush shop, where customer experience is key. Photo: Flickr/Oscar Hanzely

It’s been another bad week for the high street, with Carphone Warehouse announcing plans to close 92 stores, M&S to close 100, and WH Smith voted as the worst high street retailer out of 100 major retailers in a Which? survey.

WHSmith, the focus of a Twitter account created to mock the retailer’s outdated décor, has ranked in the bottom two in the Which?survey for eight consecutive years. Ben Clissitt, Which? magazine editor, said: “It is clear that our traditional high street is changing, and while this is bad news for some retailers who have struggled to adapt, others have seized the opportunity to make their mark.”

This is a one common thread among struggling and unpopular retailers, one that threatens to cause more casualties: a failure to modernise and adapt to the growth of online shopping, when Brits now buy a quarter of their non-food shopping online.

Other shops have changed to offer what the internet can’t. Which? found that customers valued being able to touch, feel and try on items, and ask staff questions—which goes some way to explaining why cosmetics company Lush ranked first in the survey.

"Young people will come off the internet"

Tim Radley, founder of retail specialists VM Unleashed, said the retailers who survive will offer “omni-channel” shops. “Offline and online will be completely integrated so shops are an experience, not stuff—they’re enjoyable, and people go and have a good time.”

“Young people will come off the internet, but only for experiences.”

This will include offering events, concerts, coffee shops and barbers, for example, as well as engaging and enthusiastic staff, Radley added.

Waterstones—once owned by WHSmith—came joint 8th in the Which? survey, and has reinvented itself to do just this. James Daunt, managing director of Waterstones, said this was a conscious move in 2011 after the bookseller went “stone cold bust.”

“If you compete with online, where a lot of troubles for retailers on the high street stem from, you’re not going to be competitive on price, so you have to concentrate on experience, on making shops attractive for customers,” Daunt told Prospect.

The move to respond to these new challenges has been, rather confusingly, to focus on the virtues of old-fashioned bookselling, Daunt explained, with face-to-face service that he said can become “addictive.”

“If you buy a book from somewhere that gives you that experience, it’s a better book and you’ll enjoy it more than if it pops through the letter in a brown envelope,” Daunt added.

Waterstones’ main competitor, unsurprisingly, is Amazon. WHSmith, arguably once a competitor for Waterstones, doesn’t get a look-in.

“WHSmith is a convenience retailer, so they’re probably less worried to be at the bottom of the Which? list, but for us that would be a catastrophe. WHSmith just need to have what someone needs right now, so it’s fine to have awful lighting and carpet from the 1980s,” Daunt said.

Giving customers what they want

Cathy Hart, senior lecturer in retailing at Loughborough University, said that while book retailers are doing other things to engage customers more, and make them spend more time in the store and return there instead of buying online, the best model for beating the internet isn’t booksellers, but the Apple store.

“The format is so successful, it’s about the experience and the staff, who are there to educate customers,” she said. “It comes down to understanding what customers wants”.

Retail consultant Richard Hyman agrees that retailers need to focus on the experience they offer customers, and stop opening new stores.

“High street retailers have spent last 15 years developing websites and growing online sales, but not shutting stores to compensate,” Hyman said.

The retailers that are doing well, Hyman said—including Selfridges, Primark, Zara, Aldi and Ted Baker—have one thing in common.

“They really get the customer, they understand who their core customer is and they focus relentlessly on serving them.”

A new lease of life?

Radley argues that one big indicator that high street retail isn’t dying is the trend for online-only stores to start opening physical shops, such as fashion retailer Missguided, which has opened two stores in the south of England, and where customers expect the same brand and experience online and in-store.

This is all a part of the growing expectation to have a seamless experience where we can buy anything anytime, using any device, Radley said.

Ultimately, he argues, the high street, as it looks now, isn’t going to last—but retail will.

“People are getting bored with the same, particularly when the same isn’t done very well,” he said.

“This is a big opportunity for smaller retailers, who generally have more passion. That’s what people like: less generic, more local, small chains offering something different.”

“The death of retail is nonsense. It will go back to be a community, rather than a high street full of grey shops.”