Business
Why is River Island in trouble?


The future of River Island is in the balance ahead of a crucial court ruling on the fashion chain’s restructuring plans.
The British chain – which once collaborated with Rihanna – revealed in June that it intends to close 33 shops in the UK, putting hundreds of jobs at risk, and also wants its landlords to cut rents at a further 71 stores.
It said more people shopping online and higher costs to run stores had contributed to heavy financial losses.
Reports have suggested it could collapse if its plans are not accepted by the High Court next month, although the firm said it was “confident” they will be.
So what has gone wrong for the High Street stalwart?
Catherine Shuttleworth from Savvy Marketing said River Island’s challenges were “significant” but they were shared by the wider retail industry.
She believed the fashion chain had been affected by several factors including having its stores in the wrong place and facing rising costs.
“River Island has maintained an expensive portfolio of stores at a time when costs are rising and footfall is falling,” she told the BBC.
“Many older stores find themselves in parts of town which may have been busy 20 years ago but now find themselves on the periphery.”
Known for affordable and stylish fashion, brands such as River Island and Topshop dominated High Street fashion from the early 2000s to the mid 2010s.
The first River Island store opened in 1988, after being originally founded in 1948 under the Lewis and Chelsea Girl brand before being renamed.
The family-owned retailer currently has 230 shops, employs about 5,500 people and was one of the first big UK High Street names to launch online in the late 1990s.
But recent years have proved tough. Ben Lewis, chief executive of River Island, said last month that a sharp rise in “the cost of doing business” over the past few years had “only added to the financial burden”.
Intense competition in fashion retail, not only from the likes of Boohoo, but also from Chinese giants such as Shein and Temu, have also added to its challenges.
Its most recent set of accounts revealed a £33.2m loss, with sales down 19%.

Creditors will start to vote on River Island’s restructuring plan on 1 August, and the High Court will decide whether to approve it on 7 August.
If the plans are rejected, then it is understood the retailer will revise its strategy.
River Island says the plan is a “proactive measure” to place it on “a firm footing”.
“We have been having positive conversations with key stakeholders and are confident that we will achieve approval of the plan in the next few weeks,” a spokesperson for the retailer said.
Nick Sherrard, managing director of Label Sessions, said River Island was in trouble now because of actions not taken years ago.
“What’s very apparent here is that from landlords and suppliers, to investors, no one believes in River Island enough to do it some favours,” he told the BBC.
Mr Sherrard also said River Island was missing the mark when it comes to keeping loyal customers.
“Customers know it, but they don’t know why they should care about the brand,” he added.
Can it make a comeback?
Mr Sherrard said River Island may need more time to turn its fortunes around.
“River Island’s leadership team clearly think that if they can just get a few more months, they can turn the ship around, but the best businesses know that you always have a lot less time than you think before change hits the market,” he said.
Remy Farrell, fashion editor at the Who What Wear website, told the BBC that River Island’s fate depends on how it chooses to rebrand.
“Times are tough for High Street brands that need to feel premium to stay afloat.” she said.
The current best performing brands are those that “don’t rely on buzzy microtrends”, she added, but provide “interchangeable pieces rather than seasonally targeted drops”.
“As we wait with bated breath for the return of Topshop to see just how well the nostalgia factor will support an affordably-priced, younger-skewing brand in the years to come, the concern here for River Islands longevity is who its key market is.”
Additonal reporting by Connie Bowker
Business
One year in, Business Insider’s AI search is boosting click-throughs

A year in, Business Insider’s AI onsite search is driving deeper engagement, though not necessarily broader adoption.
The AI search tool, which Business Insider launched in October 2024, is one of several AI-powered products developed by the company in the past year and discussed by BI CTO Harry Hope during a talk at this week’s Digiday Publishing Summit in Miami, Florida.
Although Business Insider’s AI search tool is currently only used by roughly one percent of Business Insider’s readership — Hope said that this was the percentage of readers who had used BI’s previous search tool, and that the “percentage hasn’t grown that dramatically in a year of use” — it has significantly increased the engagement of those who do use the tool, with click-through to articles increasing by 50 percent since October, per Hope.
“The goal here was to really find a way to build something that promoted journalism, not try and cover it up or paint it over with AI, right? We felt strongly that, when it comes to AI and chatbots, it’s not a one-size-fits-all solution,” Hope said. “We can do creative things to actually promote the work that our journalists do day-in and day-out — and it worked quite well.”
Business Insider’s updated search tool isn’t the company’s only AI product that has grown over the past year. Consumption of BI’s AI audio briefings, which launched in June, has also grown by 20 percent month-over-month, per Hope. In addition to front-facing tools like the AI search and audio briefing, Business Insider staff have stepped up their internal use of AI, with Hope estimating that between 80 and 90 percent of staff were using AI tools — an increase from the roughly 70 percent of BI staff using AI tools in May.
“People are particularly interested in building GPTs for specific use cases. I think we have about 200 right now across our organization that people have created just for different, sometimes surprising, utilities,” said Hope, who elaborated that BI staff are using AI chatbots to simulate notes from editors or feedback from potential advertisers.
Business Insider was not the only publication that discussed AI search tools on the stage at this week’s conference. Wirecutter executive director of commerce Leilani Han said that the publication’s new AI-powered search feature had “definitely” improved click-throughs to its product recommendations, although she declined to share a specific growth figure.
Han added that Wirecutter was actively looking to optimize its content for AI search — but that it had found that the playbook for AI search optimization is not a huge shift from the playbook for traditional search optimization.
“The planning doesn’t seem to be drastically different,” she said. “For us, our focus has always been certainly the readers, and that hasn’t really changed.”
During his Publishing Summit talk, Hope acknowledged that Business Insider’s AI tools aren’t yet a significant revenue stream for the company, although BI views products such as the AI audio briefing as potential advertising or sponsorship inventory down the line. For now, Business Insider is investing in AI because it believes it will improve the company’s bottom line in the future — not because it’s a huge moneymaker in 2025.
“The ROI doesn’t look great — I’m not going to lie to you, just if you compare the dollars and cents — but we need to weigh that against where we see the future panning out, where the puck is going,” Hope said. “And part of it involves buy-in and faith from your organization that it is valuable to spend some of your resources on these tools and these technologies.”
Business
Baidu shares surge as the company secures major AI partnership, fresh capital

Baidu has launched a slew of AI applications after its Ernie chatbot received public approval.
Sopa Images | Lightrocket | Getty Images
Chinese tech giant Baidu saw its shares in Hong Kong soar as much as 12% on Wednesday as the company ramps up its artificial intelligence plans and partnerships.
Shares in the Beijing-based firm, which holds a dominant position in China’s search engine market, had gained 9% overnight in U.S. trading.
The strong stock performance comes after Baidu earlier this week secured an AI-related deal with China Merchants Group, a major state-owned enterprise, focused on transportation, finance, and property development.
“Both sides plan to focus on applications of large language models, AI agents and ‘digital employees,’ vowing to make scalable and sustainable progress in industrial intelligence based on real-life business scenarios,” according to Baidu’s statement translated by CNBC.
Baidu has been aggressively pursuing its AI business, which includes its popular large language model and AI chat bot Ernie Bot.
On Tuesday the company disclosed a 4.4 billion yuan ($56.2 million) offshore bond offering due 2029, in a move that will help grow its war chest as it seeks to compete in China’s competitive AI space.
Other Chinese AI players like Tencent have also been raising funds including via debt sale this year as they pour billions into their AI capabilities.
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