Putting the Buying Experience Back in the Heart of the High Street

There has been a well-trodden narrative over the last few years about the collapse of the high street as consumer behaviour has slowly started to change, with consumers becoming more used to buying online and Amazon becomes a more entrenched part of our daily lives.  

Then retail transformation received an accelerator, on the back of the pandemic, that nobody could have ever predicted. Although more recent, I think the narrative of “we’ve seen 5-10 years of transformation (depending on what you read) in as many months” will prove to be an equally well trodden one, simply because it is true. Consumer behaviour has accelerated beyond belief which means that brands suddenly need to deploy their 5 year transformation plans overnight just to keep up.

The news last week that Boohoo bought the online business of Debenhams for £55M (and is in talks to buy Dorothy Perkins, Burton and Wallis), as well as Monday’s news that ASOS has acquired Topshop, Topman, Miss Selfridge and HIIT brands for £325M, could simply be seen as a result of these two trends - and of course they are - in part.

The implication of business rate disparity

However, you have to consider the disparity in business rates, or importantly the implication this has had on the retail sector. At the weekend the Sunday Times, decelerated that ASOS and Boohoo only paid £48.1M (on £45bn sales) versus the £160M in business rates that Philip Green has paid. 

Despite making up 5% of the economy, retailers pay one quarter of the UK’s £31B business rates. This has to change, but it’s a wider challenge for Rishi Sunak than just the retail sector. The implication is that brands like ASOS and Boohoo have been able to reinvest these huge tax savings into their business and importantly into their digital supply chain, all in service of improving one thing - the consumer experience.

Online retailers have then been able to constantly optimise all parts of the buying experience whether that be better product recommendations, clearer consumers reviews, faster load time on mobile devices, less clicks on a more intuitive site or a simpler returns process. The list goes on but be under no illusion this is where the battle has been won and will continue to be fought.

You just have to look at how Amazon define one of their leadership principles around customer obsession, “Leaders start with customers and work backwards. They work vigorously to earn and keep customer trust. Although leaders pay attention to competitors, they obsess over customers.”

Reimaging the hight street experience

So, it is clear that the high street will change with more showrooms, more click and collect hubs, more experience driven stores and all very probably with much lower business rates.  Lockdown has taught us many things but one of them is that we are inherently social beings and need to get out and about. Fashion retailers will be back. Those who thrive will be the ones that focus on building more integrated supply chains while providing relevant and seamless buying experiences through tech that sits quietly in the background.

Imagine walking into a high street retail in the not too distant future, picking up a shirt and taking it into the changing room – facial recognition logs you on to your account, recommends a jacket to go with the shirt, you’d like it in a different colour (which has been liked by 5 of your mates) and with a touch on the mirror it is ordered and fulfilled though the digital infrastructure that supports the ‘online’ business, a word that will become increasingly irrelevant for generations to come. 

It’s very hard to think about these seemingly futuristic experiences being scaled today with all the undeniable economic challenges that consumers and businesses are facing.

However, 21 years ago there was a team starting As Seen On Screen (ASOS) who thought that consumers would like to buy clothes worn by stars on TV from a website and they started to create an experience to make that happen, an experience that has constantly evolved and been progressively optimised ever since and which now dominates the fashion retail sector. 

The implications for high street fashion brands

Looking at and reimagining the consumer buying experience in 20 years may seem like a huge distraction for brands today in the frenetic world of retail but it’s essential. With the hindsight of the last 20 years, I wondered whether Philip Green would have still scaled back Arcadia’s aptly named online marketplace ‘Zoom’ shortly after buying Arcadia in 2002. 

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