H&M's UK Chief on High Street Commitment Amid Rivalry with Shein and Temu
As H&M celebrates its 50th anniversary in Britain, the Swedish fashion giant is doubling down on its physical store presence, despite fierce competition from cut-price online rivals such as Shein and Temu. Karen O'Rourke, the UK boss of H&M, emphasizes that the high street remains a vital battleground for the brand, with new stores like the recently opened Brighton location showcasing advanced technology and experiential retail.
Fifty Years of Fashion Evolution
In 1976, H&M made its British debut at the Brent Cross shopping centre, an event so significant it attracted the then Prince Charles. Fast forward to today, and the brand operates 197 stores across the UK, with the Brighton outlet featuring handheld scanners, self-service checkouts, and radio-frequency tags for precise product location. O'Rourke, who took over as UK head last year, asserts that demand for physical shopping persists, especially post-pandemic, where consumers seek more than mere transactions.
"We are fully committed to investing in our physical store portfolio because demand is there," says O'Rourke. "The high street is still very much alive and thriving. People are looking for more than just a transaction."
Combating Online Rivals with Experience
Founded in 1947 by Erling Persson, H&M has grown into a global powerhouse with 4,100 stores in 80 countries. In the UK, including brands like Cos and Arket, it boasts around 230 locations. Physical shops are central to H&M's strategy to counter rivals like Shein and Temu, which threaten traditional retail sales. The brand leverages events, designer collaborations, and loyalty schemes to create hype and engagement.
With nearly a quarter of the UK population enrolled in H&M's loyalty program, members gain access to exclusive discounts, early product releases, and events. O'Rourke notes that younger shoppers, in particular, crave brand interaction beyond online platforms. "This is where the brand comes to life, and this is where transaction meets experience. I think the customer expects more now than just being able to buy [something] and leave the store," she explains.
Creating Hype and Sustainability Focus
Recent initiatives include a London fashion week performance by Charli xcx in 2024 and a catwalk show featuring Romeo Beckham and Lola Young in 2023. "We still can create queues, we can create hype," O'Rourke states. "There is a demand for that physical experience and to be part of something that's happening."
Upcoming collaborations, such as Stella McCartney's second partnership with H&M, highlight sustainability and animal welfare, appealing to eco-conscious younger consumers. H&M has also introduced repair services in select stores and invested in recycled fabrics to align with these values.
Navigating Challenges and Future Outlook
O'Rourke's career at H&M spans 26 years, during which she has witnessed the rise of e-commerce and high street struggles. While competitors like Topshop have shifted online, H&M faces ongoing rivalry from Inditex's Zara, which overtook it as the world's largest fashion retailer two decades ago. Analysts note H&M has moved slightly upmarket, positioning its prices above Next but below Asos and Zara, focusing on quality and fashion credibility.
"It's not about being the cheapest. It's about being the best value for money," O'Rourke remarks. "Competition is good because the customer is the ultimate CEO, and they will decide what's right."
Despite challenges like high business rates and employment costs, H&M has opened three new UK stores in the past year and updated six others. The company closed 152 less profitable stores globally last year, while expanding premium brands like Arket and Cos. O'Rourke remains optimistic, stating, "We've been here 50 years. We want to be here for the next 50 years."
